[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 1031 Introduced in Senate (IS)]

112th CONGRESS
  1st Session
                                S. 1031

     To empower States with programmatic flexibility and financial 
predictability to improve their Medicaid programs and State Children's 
Health Insurance Programs by ensuring better health care for low-income 
pregnant women, children, and families, and for elderly individuals and 
 disabled individuals in need of long-term care services and supports, 
   whose income and resources are insufficient to meet the costs of 
                      necessary medical services.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              May 19, 2011

 Mr. Coburn (for himself, Mr. Burr, and Mr. Chambliss) introduced the 
 following bill; which was read twice and referred to the Committee on 
                                Finance

_______________________________________________________________________

                                 A BILL


 
     To empower States with programmatic flexibility and financial 
predictability to improve their Medicaid programs and State Children's 
Health Insurance Programs by ensuring better health care for low-income 
pregnant women, children, and families, and for elderly individuals and 
 disabled individuals in need of long-term care services and supports, 
   whose income and resources are insufficient to meet the costs of 
                      necessary medical services.

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

SECTION 1. SHORT TITLE.

    (a) Short Title.--This Act may be cited as the ``Medicaid 
Improvement and State Empowerment Act''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title.
Sec. 2. Sustainable Medicaid and CHIP programs that meet the needs of 
                            each State.
``PART B--Taxpayer-Provided Pass-Through Funding of Health Care Grants 
   to States for Pregnant Women, Low-Income Children, and Low-Income 
 Families and for Long-Term Care Services and Supports for Low-Income 
                    Elderly or Disabled Individuals

        ``Sec. 1950. Purposes; application.
        ``Sec. 1951. State plans.
        ``Sec. 1952. Grants to States.
        ``Sec. 1953. Use of grants.
        ``Sec. 1954. Administrative provisions.
        ``Sec. 1955. Penalties.
        ``Sec. 1956. Appeal of adverse decision.
        ``Sec. 1957. Annual Reports.
        ``Sec. 1958. Definitions.
Sec. 3. Medical malpractice reform State incentive fund.
Sec. 4. Repeals.
Sec. 5. Development of new formula for Federal financial participation 
                            for State child support and welfare 
                            programs to replace the FMAP.

SEC. 2. SUSTAINABLE MEDICAID AND CHIP PROGRAMS THAT MEET THE NEEDS OF 
              EACH STATE.

    (a) In General.--Title XIX of the Social Security Act (42 U.S.C. 
1396 et seq.) is amended--
            (1) by inserting after section 1900, the following:

 ``Part A--FMAP-Based Acute Care State Health Programs for the Elderly 
                            and Disabled'';

        and
            (2) by adding at the end the following:

``PART B--TAXPAYER-PROVIDED PASS-THROUGH FUNDING OF HEALTH CARE GRANTS 
   TO STATES FOR PREGNANT WOMEN, LOW-INCOME CHILDREN, AND LOW-INCOME 
 FAMILIES AND FOR LONG-TERM CARE SERVICES AND SUPPORTS FOR LOW-INCOME 
                    ELDERLY OR DISABLED INDIVIDUALS

``SEC. 1950. PURPOSES; APPLICATION.

    ``(a) In General.--The purposes of this part are to empower States 
with programmatic flexibility and financial predictability in designing 
and operating State programs to--
            ``(1) provide medical assistance for pregnant women, low-
        income children, and low-income families with children whose 
        income and resources are insufficient to meet the costs of 
        necessary medical services and rehabilitation and other 
        services to help such women, children, and families attain or 
        retain capability for independence or self-care; and
            ``(2) provide long-term care services and supports for low-
        income elderly or disabled individuals whose income and 
        resources are insufficient to meet the costs of such services 
        and supports and rehabilitation and other services to help such 
        individuals attain or retain capability for independence or 
        self-care.
    ``(b) Application.--
            ``(1) In general.--Except as provided in paragraph (2) and 
        section 1951(a)(1)(B)(iv), with respect to a State, on and 
        after January 1, 2013:
                    ``(A) Medical assistance for pregnant women, low-
                income children, or low-income families with children 
                shall be provided only in accordance with the 
                provisions of this part and the provisions of title XI 
                applicable to the provision of such assistance.
                    ``(B) Long-term care services and supports for low-
                income elderly or disabled individuals (including dual 
                eligible individuals) shall only be provided in 
                accordance with the provisions of this part and the 
                provisions of title XI applicable to the provision of 
                such services and supports.
                    ``(C) The provisions of part A of this title shall 
                no longer apply to a State program established under 
                this title to provide medical assistance for pregnant 
                women, low-income children, or low-income families with 
                children or to provide long-term care services and 
                supports to low-income elderly or disabled individuals 
                and the provisions of any drug rebate agreement that is 
                in effect under section 1927 on that date that relate 
                to the provision of medical assistance for covered 
                outpatient drugs for such women, children, or families 
                or to the provision of long-term care services and 
                supports for low-income elderly or disabled individuals 
                are terminated as of such effective date.
                    ``(D) A targeted low-income child or a parent of 
                such a child who would be eligible for child health 
                assistance or health benefits coverage under a State 
                child health plan under title XXI on June 30, 2012, 
                shall no longer receive such assistance or benefits 
                under title XXI and shall be eligible for medical 
                assistance under a State program funded under this part 
                only to the extent the child or parent satisfies the 
                eligibility criteria established by the State in its 
                State plan under section 1951. Federal funds 
                appropriated for making payments under title XXI or for 
                administering title XXI that are unobligated on January 
                1, 2013, are rescinded on that date.
                    ``(E) No payment shall be made under section 
                1903(a) to a State with respect to any disproportionate 
                share payment adjustment made under section 1923 on or 
                after January 1, 2013.
                    ``(F) In the case of a State conducting a waiver 
                under section 1115 or other authority to provide 
                medical assistance for pregnant women, low-income 
                children, or low-income families with children under a 
                State program established under this title or to 
                provide long-term care services and supports for low-
                income elderly or disabled individuals that is in 
                effect on such date, the State may elect to terminate 
                the waiver as of January 1, 2013, or may submit a 
                request to continue to provide medical assistance or 
                long-term care services and supports for such 
                individuals in accordance with the terms of the waiver. 
                The Secretary shall approve a request of a State with 
                such a waiver to extend the waiver for additional 
                periods so long as the total amount of Federal funds 
                paid to the State to conduct the waiver does not exceed 
                the amount of Federal funds that would be paid to the 
                State under this part if the waiver were not conducted 
                and medical assistance or long-term care services and 
                supports are provided under the waiver consistent with 
                the requirements of this part.
            ``(2) Hold harmless provisions.--
                    ``(A) Acute care for low-income elderly and 
                disabled.--
                            ``(i) In general.--The provisions of part A 
                        shall apply to State expenditures attributable 
                        to the provision of medical assistance for 
                        acute care for low-income elderly or disabled 
                        individuals (including dual eligible 
                        individuals) on and after January 1, 2013.
                            ``(ii) Rule of construction.--Clause (i) 
                        shall not be construed as affecting--
                                    ``(I) the termination under 
                                paragraph (1)(E) of payments under 
                                section 1903(a) for disproportionate 
                                share hospital adjustment payments 
                                under section 1923; or
                                    ``(II) State flexibility to provide 
                                dual eligible individuals with medical 
                                assistance for acute care through 
                                enrollment in a managed care entity 
                                under the amendment made by section 
                                2(b) of the Medicaid Improvement and 
                                State Empowerment Act.
                    ``(B) Commonwealths and territories.--This part 
                shall not apply to the Commonwealth of Puerto Rico, the 
                United States Virgin Islands, Guam, the Commonwealth of 
                the Northen Mariana Islands, and American Samoa. Any 
                program to provide medical assistance established under 
                this title by any such commonwealth or territory shall 
                be operated in accordance with the provisions of part A 
                of this title and subsections (f) and (g) of section 
                1108.
                    ``(C) Vaccines for children program.--The program 
                for the distribution of pediatric vaccines established 
                under section 1928 shall continue to be operated in 
                accordance with the provisions of that section.
    ``(c) Budget Authority.--This part constitutes budget authority in 
advance of appropriations Acts and represents the obligation of the 
Federal Government to provide for the payment to States of amounts 
provided under section 1952.
    ``(d) Nonentitlement.--This part shall not be interpreted to 
entitle any individual or family to medical assistance under any State 
program funded under this part or to entitle any provider or entity to 
payment for the provision of items or services under any State program 
funded under this part.

``SEC. 1951. STATE PLANS.

    ``(a) In General.--In order to receive a grant under section 1952 
for a year and for the purpose of ensuring transparency with respect to 
the expenditure of Federal revenues, a State shall submit to the 
Secretary a plan that includes the following:
            ``(1) Outline of medical assistance program.--
                    ``(A) General provisions.--A written document that 
                outlines how the State intends to conduct a program, 
                designed to serve all political subdivisions in the 
                State (not necessarily in a uniform manner), that 
                provides--
                            ``(i) medical assistance to pregnant women, 
                        low-income children, and low-income families 
                        with children whose income and resources are 
                        insufficient to meet the costs of necessary 
                        medical services, and rehabilitation and other 
                        services to help such women, children, and 
                        families attain or retain capability for 
                        independence or self-care; and
                            ``(ii) long-term care services and supports 
                        for low-income elderly or disabled individuals 
                        whose income and resources are insufficient to 
                        meet the costs of such services and supports 
                        and rehabilitation and other services to help 
                        such individuals attain or retain capability 
                        for independence or self-care.
                    ``(B) Special provisions.--
                            ``(i) The document shall set forth 
                        objective criteria for--
                                    ``(I) the determination of 
                                eligibility for medical assistance and 
                                for long-term care services and 
                                supports (which may be based on 
                                standards relating to income, family 
                                composition, patient population, health 
                                status, or age); and
                                    ``(II) fair and equitable treatment 
                                of recipients and providers, including 
                                an explanation of how the State will 
                                provide opportunities for recipients 
                                and providers who have been adversely 
                                affected to be heard in a State 
                                administrative or appeal process.
                            ``(ii) The document shall include a 
                        description of--
                                    ``(I) the benefits to be provided, 
                                which, in the case of medical 
                                assistance, shall at a minimum be of 
                                the types listed in paragraph (1) of 
                                section 8904(a) of title 5, United 
                                States Code; and
                                    ``(II) the amount (if any) of 
                                premiums, deductibles, coinsurance, or 
                                other cost sharing imposed.
                            ``(iii) The document shall include a 
                        description of how medical assistance and long-
                        term care services and supports will be 
                        provided under the State plan, such as through 
                        contracts with health maintenance 
                        organizations, managed care organizations, or 
                        regional preferred provider organization care 
                        networks, the establishment of cash-for-
                        counseling programs, family health care 
                        scholarships, or health savings accounts, the 
                        provision of consumer-driven health vouchers, 
                        or any other health coverage benefit delivery 
                        design determined by the State as appropriate 
                        for achieving the purpose of this part.
                            ``(iv) The document shall indicate how the 
                        State shall satisfy the requirements of 
                        sections 1902(a)(46) (relating to verification 
                        of declarations of citizenship, nationality, or 
                        satisfactory immigration status).
            ``(2) Certification of the administration of the program.--
        A certification by the Governor of the State specifying which 
        State agency or agencies will administer and supervise the 
        State plan under this part, which shall include assurances that 
        local governments and private sector organizations--
                    ``(A) have been consulted regarding the plan and 
                design of the provision of medical assistance and long-
                term care services and supports in the State so that 
                such assistance and services and supports are provided 
                in a manner appropriate to local populations; and
                    ``(B) have had at least 45 days to submit comments 
                on such plan and design.
            ``(3) Certification that the state will provide medical 
        assistance to children in foster care and adoption assistance 
        program.--A certification by the Governor of the State that the 
        State will take such actions as are necessary to ensure that 
        children receiving assistance under part E of title IV are 
        eligible for medical assistance under the State plan under this 
        part.
            ``(4) Certification that the state will provide indians 
        with equitable access to assistance.--A certification by the 
        Governor of the State that the State will provide each member 
        of an Indian tribe who is domiciled in the State with equitable 
        access to medical assistance and to long-term care services and 
        supports under the State plan under this part.
            ``(5) Certification of standards and procedures to ensure 
        against program fraud, waste, and abuse.--A certification by 
        the Governor of the State that the State has established and is 
        enforcing standards and procedures to ensure against program 
        fraud, waste, and abuse, including standards and procedures 
        concerning nepotism, conflicts of interest among individuals 
        responsible for the administration and supervision of the State 
        program, kickbacks, and the use of political patronage.
    ``(b) Plan Amendments.--Within 30 days after a State amends a plan 
submitted pursuant to subsection (a), the State shall notify the 
Secretary of the amendment.
    ``(c) Public Availability of State Plan Summary.--The State shall 
make a summary of any plan or plan amendment submitted by the State 
under this section publicly available on a website and through such 
other means as the State determines appropriate.
    ``(d) Limitation on Secretarial Authority.--The Secretary may only 
review a State plan or plan amendment submitted under this section for 
the purpose of confirming that a State has submitted the required 
documentation. The Secretary shall not have any authority to approve or 
deny a State plan or plan amendment submitted under this section or to 
otherwise inhibit or control the expenditure of grants paid to a State 
under section 1952.

``SEC. 1952. GRANTS TO STATES.

    ``(a) Establishment of Sustainable Medicaid Funding for States.--
            ``(1) In general.--Beginning January 1, 2013, and annually 
        thereafter, each State that has submitted a plan under section 
        1951 shall be entitled to receive from the Secretary for each 
        12-month period, a grant in an amount equal to the State health 
        grant determined for the State for the period under subsection 
        (b).
            ``(2) Termination of old medicaid and chip funding.--No 
        payment shall be made by the Secretary to any State under part 
        A of this title or under title XXI for State expenditures 
        attributable to providing on or after January 1, 2013--
                    ``(A) medical assistance (as defined in section 
                1905(a)), child health assistance (as defined in 
                section 2110(a)), or health benefits coverage for 
                pregnant women, low-income children, or low-income 
                families with children; or
                    ``(B) long-term care services and supports for 
                elderly or disabled individuals.
    ``(b) Taxpayer-Provided Pass-Through Funding of Health Grants to 
States.--
            ``(1) Appropriation.--For the purpose of making health 
        grants to States under this part, there is appropriated, out of 
        any money in the Treasury not otherwise appropriated--
                    ``(A) for the 12-month period beginning January 1, 
                2013, an amount equal to the product of--
                            ``(i) the base appropriation amount 
                        determined under paragraph (3); and
                            ``(ii) the appropriation increase factor 
                        determined under paragraph (4) for the period; 
                        and
                    ``(B) for each 12-month period thereafter, an 
                amount equal to the amount appropriated under this 
                paragraph for the preceding 12-month period, increased 
                by the appropriation increase factor determined under 
                paragraph (4) for the period.
            ``(2) Amount of grants.--
                    ``(A) Based on poverty population.--For each 12-
                month period beginning on and after January 1, 2013, 
                the Secretary shall pay each State an amount equal to 
                the product of--
                            ``(i) the amount appropriated under 
                        paragraph (1) for the period; and
                            ``(ii) the ratio of the number of 
                        individuals residing in the State whose income 
                        does not exceed 100 percent of the poverty line 
                        applicable to a family of the size involved to 
                        the number of such individuals in all States 
                        that have submitted a plan under section 1951 
                        for the period (based on data for the most 
                        recent 12-month period for which data is 
                        available).
                    ``(B) Pro rata adjustments.--The Secretary shall 
                make pro rata increases or reductions in the amounts 
                determined for States under subparagraph (A) for a 
                period as necessary to ensure that the total amount 
                appropriated for the period is allotted among all 
                States and that the total amount of all health grants 
                for States determined for a period does not exceed the 
                amount appropriated for the period.
            ``(3) Base appropriation amount.--The base appropriation 
        amount determined under this paragraph is the product of--
                    ``(A) $165,000,000,000;
                    ``(B) the appropriation increase factor determined 
                under paragraph (4) with respect to the 12-month period 
                beginning on January 1, 2011; and
                    ``(C) the appropriation increase factor determined 
                under paragraph (4) with respect to the 12-month period 
                beginning on January 1, 2012.
            ``(4) Appropriation increase factor.--The appropriation 
        increase factor determined under this paragraph for a 12-month 
        period is equal to the sum of 1 plus the sum of following:
                    ``(A) CPI-U growth factor.--The percentage 
                increase, if any, in the consumer price index for all 
                urban consumers (all items; United States city average) 
                published by the Bureau of Labor Statistics, or the 
                successor index thereto, for the fiscal year ending on 
                September 30 of the preceding 12-month period.
                    ``(B) Population growth factor.--The percentage 
                increase (if any) in the population of the United 
                States for the fiscal year ending on September 30 of 
                the preceding 12-month period, as determined by the 
                Secretary based on the most recent published estimates 
                of the Bureau of the Census.
    ``(c) Availability.--A health grant paid to a State under this 
section for a period shall remain available until expended.
    ``(d) Reports to Congress.--Not later than January 1 of 2018, and 
of every 5 years thereafter, the Comptroller General of the United 
States shall submit a report to Congress that includes an analysis of 
changes among the States in the population of individuals described in 
each clause of subsection (b)(2)(A) and such recommendations for 
legislative changes to the health grant distribution formula applied 
under subsection (b)(2) as the Comptroller General determines 
appropriate to achieve the purpose of this part and ensure a fair 
distribution of the Federal funds appropriated to carry out this part 
among the States.

``SEC. 1953. USE OF GRANTS.

    ``(a) General Rule.--A State to which a grant is made under section 
1952 may use the grant in any manner that is reasonably demonstrated to 
accomplish the purpose of this part.
    ``(b) Limitation on Use of Grant for Administrative Purposes.--
            ``(1) Limitation.--A State to which a grant is made under 
        section 1952 shall not expend more than 5 percent of the grant 
        for administrative purposes.
            ``(2) Exception.--Paragraph (1) shall not apply to the use 
        of a grant for expenditures related to preventing or 
        eliminating waste, fraud, or abuse, and expenditures for 
        information technology and computerization needed for tracking 
        or monitoring required by or under this part.

``SEC. 1954. ADMINISTRATIVE PROVISIONS.

    ``(a) Payments to States.--
            ``(1) Quarterly payments.--The Secretary shall pay each 
        health grant payable to a State under section 1952 in quarterly 
        installments, subject to this section.
            ``(2) Computation and certification of payments to 
        states.--
                    ``(A) Computation.--The Secretary shall estimate 
                the amount to be paid to each State for each quarter 
                under this part, with such estimate to be based on a 
                report filed by the State containing an estimate by the 
                State of the total sum to be expended by the State in 
                the quarter under the State program funded under this 
                part and such other information as the Secretary may 
                find necessary.
                    ``(B) Certification.--The Secretary of Health and 
                Human Services shall certify to the Secretary of the 
                Treasury the amount estimated under subparagraph (A) 
                with respect to a State, reduced or increased to the 
                extent of any overpayment or underpayment which the 
                Secretary of Health and Human Services determines was 
                made under this part to the State for any prior quarter 
                and with respect to which adjustment has not been made 
                under this paragraph.
            ``(3) Payment method.--Upon receipt of a certification 
        under paragraph (2)(B) with respect to a State, the Secretary 
        of the Treasury shall, through the Fiscal Service of the 
        Department of the Treasury and before audit or settlement by 
        the General Accounting Office, pay to the State, at the time or 
        times fixed by the Secretary of Health and Human Services, the 
        amount so certified.
    ``(b) No Waiver Authority.--Except as provided in section 
1950(b)(1)(F), the Secretary may not waive any provision of this part 
under section 1115 or any other authority.
    ``(c) Limitation on Federal Authority.--No officer or employee of 
the Federal Government may regulate the conduct of States under this 
part or enforce any provision of this part, except to the extent 
expressly provided in this part.

``SEC. 1955. PENALTIES.

    ``(a) In General.--Subject to this section:
            ``(1) Use of grant in violation of this part.--
                    ``(A) General penalty.--If an audit conducted under 
                chapter 75 of title 31, United States Code, finds that 
                an amount paid to a State under section 1952 for a 
                period has been used in violation of this part, the 
                Secretary shall reduce the grant payable to the State 
                under that section for the immediately succeeding 
                period by the amount so used.
                    ``(B) Enhanced penalty for intentional 
                violations.--If the State does not prove to the 
                satisfaction of the Secretary that the State did not 
                intend to use the amount in violation of this part, the 
                Secretary shall further reduce the grant payable to the 
                State under section 1952 for the immediately succeeding 
                period by an amount equal to 5 percent of the State 
                health grant determined for that period.
            ``(2) Failure to submit required report.--If the Secretary 
        determines that a State has not, within 45 days after the end 
        of a period for which a grant is made under section 1952, 
        submitted the report required by section 1957 for the period, 
        the Secretary shall reduce the grant payable to the State under 
        section 1952 for the immediately succeeding period by an amount 
        equal to 5 percent of the State health grant determined for 
        that period.
    ``(b) Reasonable Cause Exception.--The Secretary may not impose a 
penalty on a State under subsection (a) with respect to a requirement 
if the Secretary determines that the State has reasonable cause for 
failing to comply with the requirement.
    ``(c) Corrective Compliance Plan.--
            ``(1) In general.--
                    ``(A) Notification of violation.--Before imposing a 
                penalty against a State under subsection (a) with 
                respect to a violation of this part, the Secretary 
                shall notify the State of the violation and allow the 
                State the opportunity to enter into a corrective 
                compliance plan in accordance with this subsection 
                which outlines how the State will correct or 
                discontinue, as appropriate, the violation and how the 
                State will insure continuing compliance with this part.
                    ``(B) 60-day period to propose a corrective 
                compliance plan.--During the 60-day period that begins 
                on the date the State receives a notice provided under 
                subparagraph (A) with respect to a violation, the State 
                may submit to the Federal Government a corrective 
                compliance plan to correct or discontinue, as 
                appropriate, the violation.
                    ``(C) Consultation about modifications.--During the 
                60-day period that begins with the date the Secretary 
                receives a corrective compliance plan submitted by a 
                State in accordance with subparagraph (B), the 
                Secretary may consult with the State on modifications 
                to the plan.
                    ``(D) Acceptance of plan.--A corrective compliance 
                plan submitted by a State in accordance with 
                subparagraph (B) is deemed to be accepted by the 
                Secretary if the Secretary does not accept or reject 
                the plan during 60-day period that begins on the date 
                the plan is submitted.
            ``(2) Effect of correcting or discontinuing violation.--The 
        Secretary may not impose any penalty under subsection (a) with 
        respect to any violation covered by a State corrective 
        compliance plan accepted by the Secretary if the State corrects 
        or discontinues, as appropriate, the violation pursuant to the 
        plan.
            ``(3) Effect of failing to correct or discontinue 
        violation.--The Secretary shall assess some or all of a penalty 
        imposed on a State under subsection (a) with respect to a 
        violation if the State does not, in a timely manner, correct or 
        discontinue, as appropriate, the violation pursuant to a State 
        corrective compliance plan accepted by the Secretary.
    ``(d) Limitation on Amount of Penalties.--
            ``(1) In general.--In imposing the penalties described in 
        subsection (a), the Secretary shall not reduce any health grant 
        payable to a State for a period by more than 10 percent.
            ``(2) Carryforward of unrecovered penalties.--To the extent 
        that paragraph (1) of this subsection prevents the Secretary 
        from recovering during a period the full amount of penalties 
        imposed on a State under subsection (a) of this section for a 
        prior period, the Secretary shall apply any remaining amount of 
        such penalties to the health grant payable to the State under 
        section 1952 for the immediately succeeding period.

``SEC. 1956. APPEAL OF ADVERSE DECISION.

    ``(a) In General.--Within 5 days after the date the Secretary takes 
any adverse action under this part with respect to a State, the 
Secretary shall notify the Governor of the State of the adverse action, 
including any action with respect to the State plan submitted under 
section 1951 or the imposition of a penalty under section 1955.
    ``(b) Administrative Review.--
            ``(1) In general.--Within 60 days after the date a State 
        receives notice under subsection (a) of an adverse action, the 
        State may appeal the action, in whole or in part, to the 
        Departmental Appeals Board established in the Department of 
        Health and Human Services (in this section referred to as the 
        `Board') by filing an appeal with the Board.
            ``(2) Procedural rules.--The Board shall consider an appeal 
        filed by a State under paragraph (1) on the basis of such 
        documentation as the State may submit and as the Board may 
        require to support the final decision of the Board. In deciding 
        whether to uphold an adverse action or any portion of such an 
        action, the Board shall conduct a thorough review of the issues 
        and take into account all relevant evidence. The Board shall 
        make a final determination with respect to an appeal filed 
        under paragraph (1) not less than 60 days after the date the 
        appeal is filed.
    ``(c) Judicial Review of Adverse Decision.--
            ``(1) In general.--Within 90 days after the date of a final 
        decision by the Board under this section with respect to an 
        adverse action taken against a State, the State may obtain 
        judicial review of the final decision (and the findings 
        incorporated into the final decision) by filing an action in--
                    ``(A) the district court of the United States for 
                the judicial district in which the principal or 
                headquarters office of the State agency is located; or
                    ``(B) the United States District Court for the 
                District of Columbia.
            ``(2) Procedural rules.--The district court in which an 
        action is filed under paragraph (1) shall review the final 
        decision of the Board on the record established in the 
        administrative proceeding, in accordance with the standards of 
        review prescribed by subparagraphs (A) through (E) of section 
        706(2) of title 5, United States Code. The review shall be on 
        the basis of the documents and supporting data submitted to the 
        Board.

``SEC. 1957. ANNUAL REPORTS.

    ``Each State shall submit an annual report to the Secretary that 
describes the State's expenditures of the amount paid to the State 
under section 1952 for the most recently ended period, and includes the 
number of individuals provided medical assistance and the number of 
individuals provided long-term care services and supports under the 
State plan under this part and such other information as the Secretary 
may require. The Secretary shall submit to Congress copies of all State 
reports submitted under this section with respect to a period.

``SEC. 1958. DEFINITIONS.

    ``In this part:
            ``(1) Disabled individual.--The term `disabled individual' 
        means an individual who would be considered disabled under 
        section 1614(a)(3) or under criteria applied under the State 
        plan under part A (as in effect on March 22, 2010).
            ``(2) Dual eligible defined.--The term `dual eligible 
        individual' means an individual who is entitled to, or enrolled 
        for, benefits under part A of title XVIII of the Social 
        Security Act, or enrolled for benefits under part B of title 
        XVIII of such Act, and is eligible for medical assistance under 
        a State plan under this title or under a waiver of such plan 
        (as in effect on March 22, 2010).
            ``(3) Elderly individual.--The term `elderly individual' 
        means an individual who has attained age 65 or the age 
        specified in section 226(a)(1), whichever is greater.
            ``(4) Long-term care services and supports.--
                    ``(A) In general.--The term `long-term care 
                services and supports' means any of the services or 
                supports described in subparagraph (B) that may be 
                provided in a nursing facility, an institution, a home, 
                or other setting.
                    ``(B) Services and supports described.--For 
                purposes of subparagraph (A), the services and supports 
                described in this subparagraph include assistive 
                technology, adaptive equipment, remote monitoring 
                equipment, case management for the aged, case 
                management for individuals with disabilities, nursing 
                home services, long-term rehabilitative services 
                necessary to restore functional abilities, services 
                provided in intermediate care facilities for people 
                with disabilities, habilitation services (including 
                adult day care programs), community treatment teams for 
                individuals with mental illness, home health services, 
                services provided in an institution for mental disease, 
                a Program of All-Inclusive Care for the Elderly (PACE), 
                personal care (including personal assistance services), 
                recovery support including peer counseling, supportive 
                employment, training skills necessary to assist the 
                individual in achieving or maintaining independence, 
                training of family members including foster parents in 
                supportive and behavioral modification skills, ongoing 
                and periodic training to maintain life skills, 
                transitional care including room and board not to 
                exceed 60 days within a 12-month period.
            ``(5) Low-income.--The term `low-income' means income (as 
        determined under standards established by the State) that does 
        not exceed such percentage of the poverty line for a family of 
        the size involved as the State shall establish.
            ``(6) Medical assistance.--The term `medical assistance' 
        means health care coverage, as determined by a State and 
        described in the State plan in accordance with section 
        1951(a)(1)(B)(ii).
            ``(7) Poverty line defined.--The term `poverty line' has 
        the meaning given such term in section 673(2) of the Community 
        Services Block Grant Act (42 U.S.C. 9902(2)), including any 
        revision required by such section.
            ``(8) Pregnant woman.--The term `pregnant woman' includes a 
        woman during the 60-day period beginning on the last day of the 
        pregnancy.
            ``(9) State.--The term `State' means each of the 50 States 
        and the District of Columbia.''.
    (b) Removal of Barrier to Providing Dual Eligible Individuals With 
Acute Care Through a Managed Care Entity.--
            (1) In general.--Section 1932(a)(2) of the Social Security 
        Act (42 U.S.C. 1396u-2(a)(2)) is amended by striking 
        subparagraph (B).
            (2) Effective date.--The amendment made by paragraph (1) 
        takes effect on January 1, 2013.

SEC. 3. MEDICAL MALPRACTICE REFORM STATE INCENTIVE FUND.

    (a) Grants.--The Secretary of Health and Human Services (referred 
to in this section as the ``Secretary'') shall award grants to eligible 
States to assist such States in implementing State-based medical 
malpractice reforms.
    (b) Eligibility.--
            (1) In general.--To be eligible to receive a grant under 
        subsection (a), a State shall--
                    (A) submit to the Secretary an application, at such 
                time, in such manner, and containing such information 
                as the Secretary may require; and
                    (B) shall certify, as part of the application under 
                subparagraph (A), that the State has carried out 
                activities, including enacting State laws, that have 
                been demonstrated to lower medical malpractice claim or 
                premiums costs for physicians or to lower health care 
                costs for patients.
            (2) Study.--As part of a certification provided under 
        paragraph (1)(B), the State shall include the results of at 
        least one longitudinal, empirically-based study or data based 
        on an actuarial analysis that demonstrates cost reductions of 
        the type described in such paragraph. Such results shall be 
        provided in a manner that enables the Comptroller General of 
        the United States to make a determination as to whether such 
        results are the reasonable and demonstrable conclusion of the 
        State activities involved.
            (3) Types of laws.--Laws described in paragraph (1)(B) may 
        include caps on non-economic damages, the establishment of 
        health courts, the establishment of a comprehensive patient 
        compensation program, providing for administrative 
        determinations of compensation, providing for early offers, 
        establishing safe harbors for the practice of evidence-based 
        medicine, or other demonstrated methods to reduce costs.
    (c) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section--
            (1) $500,000,000 for the period of fiscal years 2012 
        through 2016; and
            (2) $500,000,000 for the period of fiscal years 2017 
        through 2021.
    (d) Sunset.--The authority established under this section shall not 
apply after September 30, 2021.

SEC. 4. REPEALS.

    (a) PPACA and the Health Care-Related Provisions in the Health Care 
and Education Reconciliation Act of 2010.--
            (1) In general.--Except as provided in paragraph (2):
                    (A) Effective as of the enactment of Public Law 
                111-148, such Act is repealed, and the provisions of 
                law amended or repealed by such Act are restored or 
                revived as if such Act had not been enacted.
                    (B) Effective as of the enactment of the Health 
                Care and Education Reconciliation Act of 2010 (Public 
                Law 111-152), title I and subtitle B of title II of 
                such Act are repealed, and the provisions of law 
                amended or repealed by such title or subtitle, 
                respectively, are restored or revived as if such title 
                and subtitle had not been enacted.
            (2) Nonapplication to program integrity provisions.--The 
        repeals under paragraph (1) do not apply to the provisions of, 
        and amendments made by the following:
                    (A) Section 2801 of Public Law 111-148 (relating to 
                MACPAC).
                    (B) Title IV of Public Law 111-148 (relating to 
                transparency and program integrity).
                    (C) Subtitle D of title I of Public Law 111-152 
                (relating to reducing fraud, waste, and abuse).
    (b) Repeal of ARRA Maintenance of Effort.--Subsection (f) of 
section 5001 of the American Recovery and Reinvestment Act of 2009 
(Public Law 111-5) is amended by striking paragraph (1).
    (c) CHIP.--Effective January 1, 2013, title XXI of the Social 
Security Act (42 U.S.C. 1397aa et seq.) is repealed.

SEC. 5. DEVELOPMENT OF NEW FORMULA FOR FEDERAL FINANCIAL PARTICIPATION 
              FOR STATE CHILD SUPPORT AND WELFARE PROGRAMS TO REPLACE 
              THE FMAP.

    Not later than January 1, 2012, the Secretary of Health and Human 
Services, in consultation with the States, shall establish a new 
formula for payments made to or received from States under parts D and 
E of title IV of the Social Security Act that are based on the Federal 
medical assistance percentage applicable to the State under title XIX 
of the Social Security Act. On and after January 1, 2013, the Federal 
medical assistance percentage shall only be used for purposes of making 
payments to States under part A of title XIX of that Act for 
expenditures attributable to providing medical assistance for elderly 
individuals, disabled individual, and dual eligible individuals in 
accordance with section 1958 of such Act (as added by section 3). 
Payments made to or received from a State under parts D or E of title 
IV of such Act shall be made on and after January 1, 2013, by applying 
the formula developed by the Secretary of Health and Human Services 
under this section in lieu of the Federal medical assistance 
percentage.
                                 <all>