[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3921 Introduced in House (IH)]

<DOC>






115th CONGRESS
  1st Session
                                H. R. 3921

To extend funding for the Children's Health Insurance Program, and for 
                            other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 3, 2017

 Mr. Burgess introduced the following bill; which was referred to the 
 Committee on Energy and Commerce, and in addition to the Committee on 
   Ways and Means, for a period to be subsequently determined by the 
  Speaker, in each case for consideration of such provisions as fall 
           within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
To extend funding for 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 ``Helping Ensure Access for Little 
Ones, Toddlers, and Hopeful Youth by Keeping Insurance Delivery Stable 
Act of 2017'' or the ``HEALTHY KIDS Act''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
     TITLE I--CHIP EXTENSION AND OTHER MEDICAID AND CHIP PROVISIONS

Sec. 101. Five-year funding extension of the Children's Health 
                            Insurance Program.
Sec. 102. Extension of certain programs and demonstration projects.
Sec. 103. Extension of outreach and enrollment program.
Sec. 104. Extension and reduction of additional Federal financial 
                            participation for CHIP.
Sec. 105. Modifying reduction in Medicaid DSH allotments.
Sec. 106. Puerto Rico Medicaid payments.
                           TITLE II--OFFSETS

Sec. 201. Medicaid third party liability.
Sec. 202. Treatment of lottery winnings and other lump-sum income for 
                            purposes of income eligibility under 
                            Medicaid.
Sec. 203. Adjustments to Medicare part B and part D premium subsidies 
                            for higher income individuals.

     TITLE I--CHIP EXTENSION AND OTHER MEDICAID AND CHIP PROVISIONS

SEC. 101. FIVE-YEAR FUNDING EXTENSION OF THE CHILDREN'S HEALTH 
              INSURANCE PROGRAM.

    (a) Appropriation; Total Allotment.--Section 2104(a) of the Social 
Security Act (42 U.S.C. 1397dd(a)) is amended--
            (1) in paragraph (19), by striking ``and'';
            (2) in paragraph (20), by striking the period at the end 
        and inserting a semicolon; and
            (3) by adding at the end the following new paragraphs:
            ``(21) for fiscal year 2018, $21,500,000,000;
            ``(22) for fiscal year 2019, $22,600,000,000;
            ``(23) for fiscal year 2020, $23,700,000,000;
            ``(24) for fiscal year 2021, $24,800,000,000; and
            ``(25) for fiscal year 2022, for purposes of making 2 semi-
        annual allotments--
                    ``(A) $2,850,000,000 for the period beginning on 
                October 1, 2021, and ending on March 31, 2022; and
                    ``(B) $2,850,000,000 for the period beginning on 
                April 1, 2022, and ending on September 30, 2022.''.
    (b) Allotments.--
            (1) In general.--Section 2104(m) of the Social Security Act 
        (42 U.S.C. 1397dd(m)) is amended--
                    (A) in paragraph (2)--
                            (i) in the heading, by striking ``through 
                        2016'' and inserting ``through 2022''; and
                            (ii) in subparagraph (B)--
                                    (I) in the matter preceding clause 
                                (i), by striking ``(19)'' and inserting 
                                ``(24)'';
                                    (II) in clause (ii), in the matter 
                                preceding subclause (I), by inserting 
                                ``(other than fiscal year 2022)'' after 
                                ``even-numbered fiscal year''; and
                                    (III) in clause (ii)(I), by 
                                inserting ``(or, in the case of fiscal 
                                year 2018, under paragraph (4))'' after 
                                ``clause (i)'';
                    (B) in paragraph (5)--
                            (i) by striking ``or (4)'' and inserting 
                        ``(4), or (10)''; and
                            (ii) by striking ``or 2017'' and inserting 
                        ``, 2017, or 2022'';
                    (C) in paragraph (7)--
                            (i) in subparagraph (A), by striking 
                        ``2017'' and inserting ``2022'';
                            (ii) in subparagraph (B), in the matter 
                        preceding clause (i), by inserting ``(or, in 
                        the case of fiscal year 2018, by not later than 
                        the date that is 60 days after the date of the 
                        enactment of the HEALTHY KIDS Act of 2017)'' 
                        after ``before the August 31 preceding the 
                        beginning of the fiscal year''; and
                            (iii) in the matter following subparagraph 
                        (B), by striking ``or fiscal year 2016'' and 
                        inserting ``fiscal year 2016, fiscal year 2018, 
                        fiscal year 2020, or fiscal year 2022'';
                    (D) in paragraph (9)--
                            (i) in the heading, by striking ``fiscal 
                        years 2015 and 2017'' and inserting ``certain 
                        fiscal years'';
                            (ii) by striking ``or (4)'' and inserting 
                        ``, (4), or (10)''; and
                            (iii) by striking ``or fiscal year 2017'' 
                        and inserting ``, 2017, or 2022''; and
                    (E) by adding at the end the following new 
                paragraph:
            ``(10) For fiscal year 2022.--
                    ``(A) First half.--Subject to paragraphs (5) and 
                (7), from the amount made available under subparagraph 
                (A) of paragraph (25) of subsection (a) for the semi-
                annual period described in such subparagraph, increased 
                by the amount of the appropriation for such period 
                under section 101(b)(3) of the HEALTHY KIDS Act, the 
                Secretary shall compute a State allotment for each 
                State (including the District of Columbia and each 
                commonwealth and territory) for such semi-annual period 
                in an amount equal to the first half ratio (described 
                in subparagraph (D)) of the amount described in 
                subparagraph (C).
                    ``(B) Second half.--Subject to paragraphs (5) and 
                (7), from the amount made available under subparagraph 
                (B) of paragraph (25) of subsection (a) for the semi-
                annual period described in such subparagraph, the 
                Secretary shall compute a State allotment for each 
                State (including the District of Columbia and each 
                commonwealth and territory) for such semi-annual period 
                in an amount equal to the amount made available under 
                such subparagraph, multiplied by the ratio of--
                            ``(i) the amount of the allotment to such 
                        State under subparagraph (A); to
                            ``(ii) the total of the amount of all of 
                        the allotments made available under such 
                        subparagraph.
                    ``(C) Full year amount based on growth factor 
                updated amount.--The amount described in this 
                subparagraph for a State is equal to the sum of--
                            ``(i) the amount of the State allotment for 
                        fiscal year 2021 determined under paragraph 
                        (2)(B)(i); and
                            ``(ii) the amount of any payments made to 
                        the State under subsection (n) for fiscal year 
                        2021,
                multiplied by the allotment increase factor under 
                paragraph (6) for fiscal year 2022.
                    ``(D) First half ratio.--The first half ratio 
                described in this subparagraph is the ratio of--
                            ``(i) the sum of--
                                    ``(I) the amount made available 
                                under subsection (a)(25)(A); and
                                    ``(II) the amount of the 
                                appropriation for such period under 
                                section 101(b)(3) of the HEALTHY KIDS 
                                Act; to
                            ``(ii) the sum of--
                                    ``(I) the amount described in 
                                clause (i); and
                                    ``(II) the amount made available 
                                under subsection (a)(25)(B).''.
            (2) Technical amendment.--Section 2104(m)(2)(A) of such Act 
        (42 U.S.C. 1397dd(m)(2)(A)) is amended by striking ``the 
        allotment increase factor under paragraph (5)'' each place it 
        appears and inserting ``the allotment increase factor under 
        paragraph (6)''.
            (3) One-time appropriation for fiscal year 2022.--There is 
        appropriated to the Secretary of Health and Human Services, out 
        of any money in the Treasury not otherwise appropriated, 
        $20,200,000,000 to accompany the allotment made for the period 
        beginning on October 1, 2021, and ending on March 31, 2022, 
        under paragraph (25)(A) of section 2104(a) of the Social 
        Security Act (42 U.S.C. 1397dd(a)) (as added by subsection 
        (a)(3)), to remain available until expended. Such amount shall 
        be used to provide allotments to States under paragraph (10) of 
        section 2104(m) of such Act (as added by subsection (b)(1)(E)) 
        for the first 6 months of fiscal year 2022 in the same manner 
        as allotments are provided under subsection (a)(25)(A) of such 
        section 2104 and subject to the same terms and conditions as 
        apply to the allotments provided from such subsection 
        (a)(25)(A).
    (c) Extension of the Child Enrollment Contingency Fund.--Section 
2104(n) of the Social Security Act (42 U.S.C. 1397dd(n)) is amended--
            (1) in paragraph (2)--
                    (A) in subparagraph (A)(ii)--
                            (i) by striking ``2010, 2011, 2012, 2013, 
                        2014, and 2016'' and inserting ``2010 through 
                        2014, 2016, and 2018 through 2021''; and
                            (ii) by striking ``fiscal year 2015 and 
                        fiscal year 2017'' and inserting ``fiscal years 
                        2015, 2017, and 2022''; and
                    (B) in subparagraph (B)--
                            (i) by striking ``2010, 2011, 2012, 2013, 
                        2014, and 2016'' and inserting ``2010 through 
                        2014, 2016, and 2018 through 2021''; and
                            (ii) by striking ``fiscal year 2015 and 
                        fiscal year 2017'' and inserting ``fiscal year 
                        2015, 2017, and 2022''; and
            (2) in paragraph (3)(A), in the matter preceding clause 
        (i), by striking ``or a semi-annual allotment period for fiscal 
        year 2015 or 2017'' and inserting ``or in any of fiscal years 
        2018 through 2021 (or a semi-annual allotment period for fiscal 
        year 2015, 2017, or 2022)''.
    (d) Extension of Qualifying States Option.--Section 2105(g)(4) of 
the Social Security Act (42 U.S.C. 1397ee(g)(4)) is amended--
            (1) in the heading, by striking ``through 2017'' and 
        inserting ``through 2022''; and
            (2) in subparagraph (A), by striking ``2017'' and inserting 
        ``2022''.
    (e) Extension of Express Lane Eligibility Option.--Section 
1902(e)(13)(I) of the Social Security Act (42 U.S.C. 1396a(e)(13)(I)) 
is amended by striking ``2017'' and inserting ``2022''.
    (f) Assurance of Affordability Standard for Children and 
Families.--
            (1) In general.--Section 2105(d)(3) of the Social Security 
        Act (42 U.S.C. 1397ee(d)(3)) is amended--
                    (A) in the paragraph heading, by striking ``until 
                october 1, 2019'' and inserting ``through september 30, 
                2022''; and
                    (B) in subparagraph (A), in the matter preceding 
                clause (i)--
                            (i) by striking ``2019'' and inserting 
                        ``2022''; and
                            (ii) by striking ``The preceding sentence 
                        shall not be construed as preventing a State 
                        during such period'' and inserting ``During the 
                        period that begins on October 1, 2019, and ends 
                        on September 30, 2022, the preceding sentence 
                        shall only apply with respect to children in 
                        families whose income does not exceed 300 
                        percent of the poverty line (as defined in 
                        section 2110(c)(5)) applicable to a family of 
                        the size involved. The preceding sentences 
                        shall not be construed as preventing a State 
                        during any such periods''.
            (2) Conforming amendments.--Section 1902(gg)(2) of the 
        Social Security Act (42 U.S.C. 1396a(gg)(2)) is amended--
                    (A) in the paragraph heading, by striking ``until 
                october 1, 2019'' and inserting ``through september 30, 
                2022''; and
                    (B) by striking ``September 30, 2019,'' and 
                inserting ``September 30, 2022 (but during the period 
                that begins on October 1, 2019, and ends on September 
                30, 2022, only with respect to children in families 
                whose income does not exceed 300 percent of the poverty 
                line (as defined in section 2110(c)(5)) applicable to a 
                family of the size involved)''.
    (g) CHIP Look-Alike Plans.--
            (1) Blending risk pools.--Section 2107 of the Social 
        Security Act (42 U.S.C. 1397gg) is amended by adding at the end 
        the following:
    ``(g) Use of Blended Risk Pools.--
            ``(1) In general.--Nothing in this title (or any other 
        provision of Federal law) shall be construed as preventing a 
        State from considering children enrolled in a qualified CHIP 
        look-alike program and children enrolled in a State child 
        health plan under this title (or a waiver of such plan) as 
        members of a single risk pool.
            ``(2) Qualified chip look-alike program.--In this 
        subsection, the term `qualified CHIP look-alike program' means 
        a State program--
                    ``(A) under which children who are under the age of 
                18 and are not eligible to receive medical assistance 
                under title XIX or child health assistance under this 
                title may purchase coverage through the State that 
                provides benefits that are at least identical to the 
                benefits provided under the State child health plan 
                under this title (or a waiver of such plan); and
                    ``(B) that is funded exclusively through non-
                Federal funds, including funds received by the State in 
                the form of premiums for the purchase of such 
                coverage.''.
            (2) Coverage rule.--
                    (A) In general.--Section 5000A(f)(1) of the 
                Internal Revenue Code of 1986 is amended in 
                subparagraph (A)(iii), by inserting ``or under a 
                qualified CHIP look-alike program (as defined in 
                section 2107(g) of the Social Security Act)'' before 
                the comma at the end.
                    (B) Effective date.--The amendment made by 
                subparagraph (A) shall apply with respect to taxable 
                years beginning after December 31, 2017.

SEC. 102. EXTENSION OF CERTAIN PROGRAMS AND DEMONSTRATION PROJECTS.

    (a) Childhood Obesity Demonstration Project.--Section 1139A(e)(8) 
of the Social Security Act (42 U.S.C. 1320b-9a(e)(8)) is amended--
            (1) by striking ``and $10,000,000'' and inserting ``, 
        $10,000,000''; and
            (2) by inserting after ``2017'' the following: ``, and 
        $25,000,000 for the period of fiscal years 2018 through 2022''.
    (b) Pediatric Quality Measures Program.--Section 1139A(i) of the 
Social Security Act (42 U.S.C. 1320b-9a(i)) is amended--
            (1) by striking ``Out of any'' and inserting the following:
            ``(1) In general.--Out of any'';
            (2) by striking ``there is appropriated for each'' and 
        inserting ``there is appropriated--
                    ``(A) for each'';
            (3) by striking ``, and there is appropriated for the 
        period'' and inserting ``;
                    ``(B) for the period'';
            (4) by striking ``. Funds appropriated under this 
        subsection shall remain available until expended'' and 
        inserting ``; and''; and
            (5) by adding at the end the following:
                    ``(C) for the period of fiscal years 2018 through 
                2022, $75,000,000 for the purpose of carrying out this 
                section (other than subsections (e), (f), and (g)).
            ``(2) Availability.--Funds appropriated under this 
        subsection shall remain available until expended.''.

SEC. 103. EXTENSION OF OUTREACH AND ENROLLMENT PROGRAM.

    Section 2113 of the Social Security Act (42 U.S.C. 1397mm) is 
amended--
            (1) in subsection (a)(1), by striking ``2017'' and 
        inserting ``2022''; and
            (2) in subsection (g)--
                    (A) by striking ``and $40,000,000'' and inserting 
                ``, $40,000,000''; and
                    (B) by inserting after ``2017'' the following: ``, 
                and $100,000,000 for the period of fiscal years 2018 
                through 2022''.

SEC. 104. EXTENSION AND REDUCTION OF ADDITIONAL FEDERAL FINANCIAL 
              PARTICIPATION FOR CHIP.

    Section 2105(b) of the Social Security Act (42 U.S.C. 1397ee(b)) is 
amended in the second sentence by inserting ``and during the period 
that begins on October 1, 2019, and ends on September 30, 2020, the 
enhanced FMAP determined for a State for a fiscal year (or for any 
portion of a fiscal year occurring during such period) shall be 
increased by 11.5 percentage points'' after ``23 percentage points,''.

SEC. 105. MODIFYING REDUCTION IN MEDICAID DSH ALLOTMENTS.

    Section 1923(f)(7)(A)(ii) of the Social Security Act (42 U.S.C. 
1396r-4(f)(7)(A)(ii)) is amended--
            (1) by striking subclause (I) and redesignating subclauses 
        (II) through (VIII) as subclauses (I) through (VII), 
        respectively;
            (2) in subclause (VI), as redesignated by paragraph (1), by 
        striking at the end ``and'';
            (3) in subclause (VII), as redesignated by paragraph (1), 
        by striking at the end the period and inserting a semicolon; 
        and
            (4) by adding at the end the following new subclauses:
                                    ``(VIII) $8,000,000,000 for fiscal 
                                year 2026; and
                                    ``(IX) $8,000,000,000 for fiscal 
                                year 2027.''.

SEC. 106. PUERTO RICO MEDICAID PAYMENTS.

    (a) Increased Cap.--Section 1108(g) of the Social Security Act (42 
U.S.C. 1308(g)) is amended--
            (1) in paragraph (2)(A), by inserting ``(or, with respect 
        to fiscal years 2018 and 2019, increased by such percentage 
        increase plus one percentage point)'' after ``beginning of the 
        fiscal year''; and
            (2) in paragraph (5)--
                    (A) in subparagraph (A), by striking ``subparagraph 
                (B)'' and inserting ``subparagraphs (B), (C), (D), and 
                (E)''; and
                    (B) by adding at the end the following new 
                subparagraphs:
                    ``(C) The amount of the increase otherwise provided 
                under subparagraph (A) for Puerto Rico shall be further 
                increased by $880,000,000.
                    ``(D)(i) For the period beginning October 1, 2017, 
                and ending December 31, 2019, the amount of the 
                increase otherwise provided under subparagraph (A) for 
                Puerto Rico shall be further increased by $120,000,000 
                if the Financial Oversight and Management Board for 
                Puerto Rico established under section 101 of the Puerto 
                Rico Oversight, Management, and Economic Stability Act 
                (48 U.S.C. 2121) certifies by a majority vote that 
                Puerto Rico has taken reasonable and appropriate steps 
                during such period to--
                            ``(I) reduce fraud, waste, and abuse under 
                        the program under title XIX;
                            ``(II) implement strategies to reduce 
                        unnecessary, inefficient, or excessive spending 
                        under title XIX;
                            ``(III) improve the use and availability of 
                        Medicaid data for program operation and 
                        oversight; and
                            ``(IV) improve the quality of care and 
                        patient experience for individuals enrolled 
                        under the program under title XIX.
                    ``(ii) As a condition of any additional increase 
                pursuant to clause (i), not later than October 1, 2018, 
                Puerto Rico shall submit to the Financial Oversight and 
                Management Board for Puerto Rico a report regarding 
                steps taken to achieve each of the goals described in 
                subclauses (I) through (IV) of clause (i).
                    ``(E) Payments under section 1903(a)(8) for a 
                quarter of a fiscal year shall not be taken into 
                account in applying subsection (f) (as increased in 
                accordance with this paragraph and paragraphs (1), (2), 
                (3), and (4)) to Puerto Rico for such fiscal year.''.
    (b) Federal Match for Medical Personnel and Fraud Reduction.--
Section 1903(a) of the Social Security Act (42 U.S.C. 1396b(a)) is 
amended--
            (1) in paragraph (2)(A), by inserting ``subject to 
        paragraph (8),'' before ``an amount'';
            (2) in paragraph (6)--
                    (A) in subparagraph (B), by inserting ``subject to 
                paragraph (8),'' before ``75 per centum''; and
                    (B) by striking at the end ``plus'';
            (3) in paragraph (7), by striking at the end the period and 
        inserting ``; plus''; and
            (4) by adding at the end the following new paragraph:
            ``(8) for quarters during the period beginning January 1, 
        2018, and ending December 31, 2019, paragraphs (2)(A) and (6) 
        shall apply with respect to Puerto Rico as if--
                    ``(A) the reference to `75 per centum' in paragraph 
                (2)(A) were a reference to `90 per centum'; and
                    ``(B) the reference to `75 per centum' in paragraph 
                (6)(B) were a reference to `90 per centum'.''.

                           TITLE II--OFFSETS

SEC. 201. MEDICAID THIRD PARTY LIABILITY PROVISIONS.

    (a) Medicaid Third Party Liability.--
            (1) Delay of bipartisan budget act of 2013 third party 
        liability provisions.--
                    (A) In general.--Section 202(c) of the Bipartisan 
                Budget Act of 2013 (Public Law 113-67; 127 Stat. 1177; 
                42 U.S.C. 1396a note), as amended by section 211 of the 
                Protecting Access to Medicare Act of 2014 (Public Law 
                113-93; 128 Stat. 1047; 42 U.S.C. 1396a note) and 
                section 220 of the Medicare Access and CHIP 
                Reauthorization Act of 2015 (Public Law 114-10), is 
                amended by striking ``2017'' and inserting ``2019''.
                    (B) Effective date; treatment.--The amendment made 
                by subparagraph (A) shall take effect on September 30, 
                2017, and shall apply with respect to claims generated 
                or filed after such date.
            (2) Clarification of definitions applicable to third party 
        liability.--
                    (A) In general.--Section 1902 of the Social 
                Security Act (42 U.S.C. 1396a) is amended by adding at 
                the end the following new subsection:
    ``(nn) For purposes of subsection (a)(25) and section 
1903(d)(2)(B):
            ``(1) The term `responsible third party' means a health 
        insurer, an accountable care organization, or any other party 
        that is, by statute, contract, or agreement, legally 
        responsible for payment of a claim for a health care item or 
        service. Such term does not include a party if payment by such 
        party has been made or can reasonably be expected to be made 
        under a workmen's compensation law or plan of the United States 
        or a State, or under an automobile or liability insurance 
        policy or plan (including a self-insured plan), or under no 
        fault insurance.
            ``(2) The term `health insurer' means a group health plan, 
        as defined in section 607(1) of the Employee Retirement Income 
        Security Act of 1974, a self-insured plan, a fully-insured 
        plan, a service benefit plan, a medicaid managed care plan 
        under section 1903(m) or 1932, a pharmacy benefit manager, and 
        any other health plan determined appropriate by the 
        Secretary.''.
                    (B) Conforming amendments.--Section 1902(a)(25) of 
                the Social Security Act (42 U.S.C. 1396a(a)(25)) is 
                amended--
                            (i) in subparagraph (A), in the matter 
                        preceding clause (i), by striking ``third 
                        parties'' and all that follows through ``item 
                        or service)'' and inserting ``responsible third 
                        parties'';
                            (ii) in subparagraph (G), by striking 
                        ``health insurer'' and all that follows through 
                        ``item or service)'' and inserting 
                        ``responsible third party'';
                            (iii) in subparagraph (I), in the matter 
                        preceding clause (i), by striking ``health 
                        insurers'' and all that follows through ``item 
                        or service'' and inserting ``responsible third 
                        parties''; and
                            (iv) by inserting ``responsible'' before 
                        ``third'' each place it appears in 
                        subparagraphs (A)(i), (A)(ii), (C), (D), and 
                        (H).
            (3) Removal of special treatment of certain types of care 
        and payments under medicaid third party liability rules.--
        Section 1902(a)(25) of the Social Security Act (42 U.S.C. 
        1396a(a)(25)), as amended by section 202(c) of the Bipartisan 
        Budget Act of 2013 (after application of paragraph (1)), is 
        amended by striking subparagraphs (E) and (F).
            (4) Clarification of role of health insurers with respect 
        to third party liability.--
                    (A) In general.--Section 1902(a)(25) of the Social 
                Security Act (42 U.S.C. 1396a(a)(25)), as amended by 
                paragraph (3), is further amended by inserting after 
                subparagraph (D) the following new subparagraphs:
                    ``(E) that, in the case of a State that provides 
                medical assistance under this title through a contract 
                with a health insurer, such contract shall specify 
                whether the State is--
                            ``(i) delegating to such insurer all or 
                        some of its right of recovery from a 
                        responsible third party for an item or service 
                        for which payment has been made under the State 
                        plan (or under a waiver of the plan); and
                            ``(ii) transferring to such insurer all or 
                        some of the assignment to the State of any 
                        right of an individual or other entity to 
                        payment from a responsible third party for an 
                        item or service for which payment has been made 
                        under the State plan (or under a waiver of the 
                        plan);
                    ``(F) that, in the case of a State that elects an 
                option described in clause (i) or (ii) of subparagraph 
                (E) with respect to a health insurer, the State shall 
                provide assurances to the Secretary that the State laws 
                referred to in subparagraph (I) confer to the health 
                insurer the authority of the State with respect to the 
                requirements specified in clauses (i) through (iv) of 
                such subparagraph;''.
                    (B) Treatment of collected amounts.--Section 
                1903(d)(2)(B) of the Social Security Act (42 U.S.C. 
                1396b(d)(2)(B)) is amended by adding at the end the 
                following: ``For purposes of this subparagraph, 
                reimbursements made by a responsible third party to 
                health insurers pursuant to section 1902(a)(25)(E) 
                shall be treated in the same manner as reimbursements 
                made to a State under the previous sentence.''.
            (5) Increasing state flexibility with respect to third 
        party liability.--Section 1902(a)(25)(I) of the Social Security 
        Act (42 U.S.C. 1396a(a)(25)(I)) is amended--
                    (A) in clause (i), by striking ``medical assistance 
                under the State plan'' and inserting ``medical 
                assistance under a State plan (or under a waiver of the 
                plan)'';
                    (B) by striking clause (ii) and inserting the 
                following new clause:
                            ``(ii) accept--
                                    ``(I) any State's right of recovery 
                                and the assignment to any State of any 
                                right of an individual or other entity 
                                to payment from the party for an item 
                                or service for which payment has been 
                                made under the respective State's plan 
                                (or under a waiver of the plan); and
                                    ``(II) as a valid authorization of 
                                the responsible third party for the 
                                furnishing of an item or service to an 
                                individual eligible to receive medical 
                                assistance under this title, an 
                                authorization made on behalf of such 
                                individual under the State plan (or 
                                under a waiver of such plan) for the 
                                furnishing of such item or service to 
                                such individual;'';
                    (C) in clause (iii)--
                            (i) by striking ``respond to'' and 
                        inserting ``not later than 60 days after 
                        receiving''; and
                            (ii) by striking ``; and'' at the end and 
                        inserting ``, respond to such inquiry; and''; 
                        and
                    (D) in clause (iv), by inserting ``a failure to 
                obtain a prior authorization,'' after ``claim form,''.
            (6) State incentive to pursue third party liability for 
        newly eligibles.--Section 1903(d)(2)(B) of the Social Security 
        Act (42 U.S.C. 1396b(d)(2)(B)), as amended by paragraph (4)(B), 
        is further amended by adding at the end the following: ``In the 
        case of expenditures for medical assistance provided during 
        2017 and subsequent years for individuals described in 
        subclause (VIII) of section 1902(a)(10)(A)(i), in determining 
        the amount, if any, of overpayment under this subparagraph with 
        respect to such medical assistance, the Secretary shall apply 
        the Federal medical assistance percentage for the State under 
        section 1905(b), notwithstanding the application of section 
        1905(y).''.
    (b) Compliance With Third Party Insurance Reporting.--Section 1903 
of the Social Security Act (42 U.S.C. 1396b) is amended by inserting 
after subsection (m) the following new subsection:
    ``(n)(1) For any year beginning after 2020 (or a sooner year as 
provided in paragraph (2)), if a State fails to comply with the 
requirements of section 1902(a)(25) with respect to each calendar 
quarter in such year, the Secretary may reduce the Federal medical 
assistance percentage by 0.1 percentage point for calendar quarters in 
each subsequent year in which the State fails to so comply (and 
cumulatively for a failure to so comply for a period of consecutive 
years).
    ``(2) The Secretary may apply paragraph (1)--
            ``(A) for any year beginning after 2018, if a State fails 
        to comply with the requirements of section 1902(a)(25) with 
        respect to payment for items and services furnished to 
        individuals described in subclause (VIII) of section 
        1902(a)(10)(A)(i) or non-expansion individuals; and
            ``(B) for any year beginning after 2019, if a State fails 
        to comply with the requirements of section 1902(a)(25) with 
        respect to payment for items and services furnished to 
        individuals described in subdivision (i), (iii), or (iv) of 
        section 1905(a).
    ``(3) For purposes of this subsection, the term `non-expansion 
individual' means, with respect to a State for a month, an individual 
who is--
            ``(A) eligible for medical assistance for items or services 
        under this title and enrolled under the State plan (or a waiver 
        of such plan) under this title for the month;
            ``(B) not under 19 years of age;
            ``(C) not 65 years of age or older; and
            ``(D) not eligible for medical assistance under this title 
        on the basis of being blind or disabled.''.
    (c) Application to CHIP.--
            (1) In general.--Section 2107(e)(1) of the Social Security 
        Act (42 U.S.C. 1397gg(e)(1)) is amended--
                    (A) by redesignating subparagraphs (B) through (R) 
                as subparagraphs (C) through (S), respectively; and
                    (B) by inserting after subparagraph (A) the 
                following new subparagraph:
                    ``(B) Section 1902(a)(25) (relating to third party 
                liability).''.
            (2) Mandatory reporting.--Section 1902(a)(25)(I)(i) of the 
        Social Security Act (42 U.S.C. 1396a(a)(25)(I)(i)), as amended 
        by subsection (a)(5), is further amended--
                    (A) by striking ``(and, at State option, child'' 
                and inserting ``and child''; and
                    (B) by striking ``title XXI)'' and inserting 
                ``title XXI''.
    (d) Training on Third Party Liability.--Section 1936 of the Social 
Security Act (42 U.S.C. 1396u-6) is amended--
            (1) in subsection (b)(4), by striking ``and quality of 
        care'' and inserting ``, quality of care, and the liability of 
        responsible third parties (as defined in section 1902(nn))''; 
        and
            (2) by adding at the end the following new subsection:
    ``(f) Third Party Liability Training.--With respect to education or 
training activities carried out pursuant to subsection (b)(4) with 
respect to the liability of responsible third parties (as defined in 
section 1902(nn) for payment for items and services furnished under 
State plans (or under waivers of such plans)) under this title, the 
Secretary shall--
            ``(1) publish (and update on an annual basis) on the public 
        Internet website of the Centers for Medicare & Medicaid 
        Services a dedicated Internet page containing best practices to 
        be used in assessing such liability;
            ``(2) monitor efforts to assess such liability and analyze 
        the challenges posed by that assessment;
            ``(3) distribute to State agencies administering the State 
        plan under this title information related to such efforts and 
        challenges; and
            ``(4) provide guidance to such State agencies with respect 
        to State oversight of efforts under a medicaid managed care 
        plan under section 1903(m) or 1932 to assess such liability.''.
    (e) Development of Model Uniform Fields for States To Report Third 
Party Information.--Not later than January 1, 2019, the Secretary of 
Health and Human Services shall, in consultation with the States, 
develop and make available to the States a model uniform reporting 
field that States may use for purposes of reporting to the Secretary 
through the Transformed Medicaid Statistical Information System (T-
MSIS) (or a successor system), or within CMS Form 64 (or any successor 
form), information identifying responsible third parties (as defined in 
subsection (nn) of section 1902 of the Social Security Act (42 U.S.C. 
1396a), as added by subsection (a)(2)(A)) and other relevant 
information for ascertaining the legal responsibility of such third 
parties to pay for care and services available under the State plan (or 
under a waiver of the plan) under title XIX of the Social Security Act 
(42 U.S.C. 1396 et seq.).
    (f) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), this 
        section and the amendments made by this section (other than as 
        specified in the preceding provisions of this section) shall 
        take effect on October 1, 2019, and shall apply to medical 
        assistance or child health assistance provided on or after such 
        date.
            (2) Exception if state legislation required.--In the case 
        of a State plan for medical assistance under title XIX of the 
        Social Security Act (42 U.S.C. 1396 et seq.), or a State child 
        health plan for child health assistance under title XXI of such 
        Act (42 U.S.C. 1397aa et seq.), that the Secretary of Health 
        and Human Services determines requires State legislation (other 
        than legislation appropriating funds) in order for the plan to 
        meet the additional requirement imposed by the amendments made 
        under this section, such plan shall not be regarded as failing 
        to comply with the requirements of such title solely on the 
        basis of its failure to meet this additional requirement 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 the 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 such session 
        shall be deemed to be a separate regular session of the State 
        legislature.

SEC. 202. TREATMENT OF LOTTERY WINNINGS AND OTHER LUMP-SUM INCOME FOR 
              PURPOSES OF INCOME ELIGIBILITY UNDER MEDICAID.

    (a) In General.--Section 1902 of the Social Security Act (42 U.S.C. 
1396a) is amended--
            (1) in subsection (a)(17), by striking ``(e)(14), (e)(14)'' 
        and inserting ``(e)(14), (e)(15)''; and
            (2) in subsection (e)--
                    (A) in paragraph (14) (relating to modified 
                adjusted gross income), by adding at the end the 
                following new subparagraph:
                    ``(J) Treatment of certain lottery winnings and 
                income received as a lump sum.--
                            ``(i) In general.--In the case of an 
                        individual who is the recipient of qualified 
                        lottery winnings (pursuant to lotteries 
                        occurring on or after January 1, 2018) or 
                        qualified lump sum income (received on or after 
                        such date) and whose eligibility for medical 
                        assistance is determined based on the 
                        application of modified adjusted gross income 
                        under subparagraph (A), a State shall, in 
                        determining such eligibility, include such 
                        winnings or income (as applicable) as income 
                        received--
                                    ``(I) in the month in which such 
                                winnings or income (as applicable) is 
                                received if the amount of such winnings 
                                or income is less than $80,000;
                                    ``(II) over a period of 2 months if 
                                the amount of such winnings or income 
                                (as applicable) is greater than or 
                                equal to $80,000 but less than $90,000;
                                    ``(III) over a period of 3 months 
                                if the amount of such winnings or 
                                income (as applicable) is greater than 
                                or equal to $90,000 but less than 
                                $100,000; and
                                    ``(IV) over a period of 3 months 
                                plus 1 additional month for each 
                                increment of $10,000 of such winnings 
                                or income (as applicable) received, not 
                                to exceed a period of 120 months (for 
                                winnings or income of $1,260,000 or 
                                more), if the amount of such winnings 
                                or income is greater than or equal to 
                                $100,000.
                            ``(ii) Counting in equal installments.--For 
                        purposes of subclauses (II), (III), and (IV) of 
                        clause (i), winnings or income to which such 
                        subclause applies shall be counted in equal 
                        monthly installments over the period of months 
                        specified under such subclause.
                            ``(iii) Hardship exemption.--An individual 
                        whose income, by application of clause (i), 
                        exceeds the applicable eligibility threshold 
                        established by the State, shall continue to be 
                        eligible for medical assistance to the extent 
                        that the State determines, under procedures 
                        established by the State (in accordance with 
                        standards specified by the Secretary), that the 
                        denial of eligibility of the individual would 
                        cause an undue medical or financial hardship as 
                        determined on the basis of criteria established 
                        by the Secretary.
                            ``(iv) Notifications and assistance 
                        required in case of loss of eligibility.--A 
                        State shall, with respect to an individual who 
                        loses eligibility for medical assistance under 
                        the State plan (or a waiver of such plan) by 
                        reason of clause (i)--
                                    ``(I) before the date on which the 
                                individual loses such eligibility, 
                                inform the individual--
                                            ``(aa) of the individual's 
                                        opportunity to enroll in a 
                                        qualified health plan offered 
                                        through an Exchange established 
                                        under title I of the Patient 
                                        Protection and Affordable Care 
                                        Act during the special 
                                        enrollment period specified in 
                                        section 9801(f)(3) of the 
                                        Internal Revenue Code of 1986 
                                        (relating to loss of Medicaid 
                                        or CHIP coverage); and
                                            ``(bb) of the date on which 
                                        the individual would no longer 
                                        be considered ineligible by 
                                        reason of clause (i) to receive 
                                        medical assistance under the 
                                        State plan or under any waiver 
                                        of such plan and be eligible to 
                                        reapply to receive such medical 
                                        assistance; and
                                    ``(II) provide technical assistance 
                                to the individual seeking to enroll in 
                                such a qualified health plan.
                            ``(v) Qualified lottery winnings defined.--
                        In this subparagraph, the term `qualified 
                        lottery winnings' means winnings from a 
                        sweepstakes, lottery, or pool described in 
                        paragraph (3) of section 4402 of the Internal 
                        Revenue Code of 1986 or a lottery operated by a 
                        multistate or multijurisdictional lottery 
                        association, including amounts awarded as a 
                        lump sum payment.
                            ``(vi) Qualified lump sum income defined.--
                        In this subparagraph, the term `qualified lump 
                        sum income' means income that is received as a 
                        lump sum from one of the following sources:
                                    ``(I) Monetary winnings from 
                                gambling (as defined by the Secretary 
                                and including gambling activities 
                                described in section 1955(b)(4) of 
                                title 18, United States Code).
                                    ``(II) Damages received, whether by 
                                suit or agreement and whether as lump 
                                sums or as periodic payments (other 
                                than monthly payments), on account of 
                                causes of action other than causes of 
                                action arising from personal physical 
                                injuries or physical sickness.
                                    ``(III) Income received as liquid 
                                assets from the estate (as defined in 
                                section 1917(b)(4)) of a deceased 
                                individual.''; and
                    (B) by striking ``(14) Exclusion'' and inserting 
                ``(15) Exclusion''.
    (b) Rules of Construction.--
            (1) Interception of lottery winnings allowed.--Nothing in 
        the amendment made by subsection (a)(2)(A) shall be construed 
        as preventing a State from intercepting the State lottery 
        winnings awarded to an individual in the State to recover 
        amounts paid by the State under the State Medicaid plan under 
        title XIX of the Social Security Act for medical assistance 
        furnished to the individual.
            (2) Applicability limited to eligibility of recipient of 
        lottery winnings or lump sum income.--Nothing in the amendment 
        made by subsection (a)(2)(A) shall be construed, with respect 
        to a determination of household income for purposes of a 
        determination of eligibility for medical assistance under the 
        State plan under title XIX of the Social Security Act (42 
        U.S.C. 1396 et seq.) (or a waiver of such plan) made by 
        applying modified adjusted gross income under subparagraph (A) 
        of section 1902(e)(14) of such Act (42 U.S.C. 1396a(e)(14)), as 
        limiting the eligibility for such medical assistance of any 
        individual that is a member of the household other than the 
        individual who received qualified lottery winnings or qualified 
        lump-sum income (as defined in subparagraph (J) of such section 
        1902(e)(14), as added by subsection (a)(2)(A) of this section).

SEC. 203. ADJUSTMENTS TO MEDICARE PART B AND PART D PREMIUM SUBSIDIES 
              FOR HIGHER INCOME INDIVIDUALS.

    (a) In General.--Section 1839(i)(3)(C)(i)(II) of the Social 
Security Act (42 U.S.C. 1395r(i)(3)(C)(i)(II)) is amended, in the 
table, by striking the last row and inserting the following new rows:


``More than $160,000 but less than $500,000.......            80 percent
At least $500,000.................................       100 percent.''.
 

    (b) Joint Returns.--Section 1839(i)(3)(C)(ii) of the Social 
Security Act (42 U.S.C. 1395r(i)(3)(C)(ii)) is amended by inserting 
before the period the following: ``except, with respect to the dollar 
amounts applied in the last row of the table under subclause (II) of 
such clause (and the second dollar amount specified in the second to 
last row of such table), clause (i) shall be applied by substituting 
dollar amounts which are 175 percent of such dollar amounts for the 
calendar year''.
    (c) Inflation Adjustment.--Section 1839(i) of the Social Security 
Act (42 U.S.C. 1395r(i)) is amended--
            (1) in paragraph (5)--
                    (A) in subparagraph (A), by striking ``In the 
                case'' and inserting ``Subject to subparagraph (C), in 
                the case'';
                    (B) in subparagraph (B), by striking ``subparagraph 
                (A)'' and inserting ``subparagraph (A) or (C)''; and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(C) Treatment of adjustments for certain higher 
                income individuals.--
                            ``(i) In general.--Subparagraph (A) shall 
                        not apply with respect to each dollar amount in 
                        paragraph (3) of $500,000.
                            ``(ii) Adjustment beginning 2027.--In the 
                        case of any calendar year beginning after 2026, 
                        each dollar amount in paragraph (3) of $500,000 
                        shall be increased by an amount equal to--
                                    ``(I) such dollar amount, 
                                multiplied by
                                    ``(II) the percentage (if any) by 
                                which the average of the Consumer Price 
                                Index for all urban consumers (United 
                                States city average) for the 12-month 
                                period ending with August of the 
                                preceding calendar year exceeds such 
                                average for the 12-month period ending 
                                with August 2025.''; and
            (2) in paragraph (6)(B), by inserting ``(other than 
        $500,000)'' after ``the dollar amounts''.
                                 <all>