[Congressional Record Volume 149, Number 39 (Tuesday, March 11, 2003)]
[Senate]
[Pages S3508-S3512]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ROCKEFELLER (for himself, Mr. Corzine, Mr. Inouye, Ms. 
        Landrieu, Mr. Levin, Mr. Reed, and Mr. Sarbanes):
  S. 588. A bill to amend the Social Security Act to guarantee 
comprehensive health care coverage for all children born after 2004; to 
the Committee on Finance.
  Mr. ROCKEFELLER. Mr. President, I am pleased and proud to introduce 
the MediKids Health Insurance Act of 2003. Congressman Stark is 
introducing a companion bill in the House.
  This legislation is, without a doubt, ambitious. It is a deliberate 
effort to try to ignite a national commitment to the goal of insuring 
all of our children. For some, that is an idealistic proposition that 
does not seem achievable. With this bill, I want to call on the public 
and my colleagues to consider once again the clear and convincing case 
for investing the necessary resources in the health of our children--
and therefore, in the well-being of their families and our entire 
country. The President and Congress continue to talk about their 
commitment to America's health. This bill challenges them to take 
action on their rhetoric.
  Our children are not only our future, they are also our present. What 
we do for them today will greatly affect what happens tomorrow. Yet 
even though we recognize these facts, we still have not found a way to 
guarantee health coverage for children. Without health insurance, many 
of these children go without health care all together.
  Children are the least expensive segment of our population to insure. 
They are also the least able to have control over whether or not they 
have health insurance. Yet we now have over 9 million uninsured 
children in this country. And with the downturn in the economy and the 
rising costs of health care, this number will continue rising.
  Our success in expanding Medicaid and passing the State Children's 
Health Insurance Program was a meaningful, significant start at closing 
the tragic gap represented by millions of uninsured children. However, 
Congress cannot point to these programs and declare that our work is 
done. We still have much more to do. The percent of children in low-
income families without health insurance has not changed in recent 
years. Even with perfect enrollment in S-CHIP and Medicaid, there would 
still be a great number of children without health insurance.
  This is partially due to our increasingly mobile society, where 
parents frequently change jobs and families often move from State to 
State. When this occurs there is often a lapse in health coverage. 
Also, families working their way out of welfare fluctuate between 
eligibility and ineligibility for means-tested assistance programs. 
Another reason for the number of uninsured children is that the cost of 
health insurance continues to increase, leaving many working parents 
unable to afford coverage for themselves or their families. All of this 
adds up to the fact that many of our children do not have the 
consistent and regular access to health care which they need to grow up 
healthy.
  That is why I am re-introducing the MediKids Health Insurance Act. 
This bill would automatically enroll every child at birth into a new, 
comprehensive Federal safety net health insurance program beginning in 
2004. The benefits would be tailored to the needs of children and would 
be similar to those currently available to children under Medicaid. A 
small monthly premium would be collected from parents at tax filing, 
with discounts to low-income families phasing out at 300 percent of 
poverty. The children would remain enrolled in MediKids throughout 
childhood. When they are covered by another health insurance program, 
their parents would be exempt from the premium. The key to our program 
is that whenever other sources of health insurance fail, MediKids would 
stand ready to cover the health needs of our next generation. By the 
year 2020, every child in America would be able to grow up with 
consistent, continuous health insurance coverage.
  Like Medicare, MediKids would be independently financed, would cover 
benefits tailored to the needs of its target population, and would have 
the goal of achieving nearly 100 percent health insurance coverage for 
the children of this country--just as Medicare has done for our 
Nation's seniors and disabled population. It's time we make this 
investment in the future of America by guaranteeing all children the 
health coverage they need to make a healthy start in life.
  The MediKids Health Insurance Act would offer guaranteed, automatic 
health coverage for every child with the simplest of enrollment 
procedures and no challenging outreach, paperwork, or re-determination 
hoops to jump through. It would be able to follow children across state 
lines, or tide them over in a new location until their parents can 
enroll them in a new insurance program. Between jobs or during family 
crises such as divorce or the death of a parent, it would offer extra 
security and ensure continuous health coverage to the Nation's 
children. During that critical period when a family is just climbing 
out of poverty and out of the eligibility range for means-tested 
assistance programs, it would provide an extra boost with health 
insurance for the children until the parents can move into jobs that 
provide reliable health insurance coverage. And every child would 
automatically be enrolled upon birth, along with the issuance of the 
birth certificate or immigration card.
  As we all know, an ounce of prevention is worth a pound of cure. 
Providing health care coverage to children affects much more than their 
health--it affects their ability to learn, their ability to thrive, and 
their ability to become a productive member of society. I look forward 
to working with my colleagues and supporting organizations for the 
passage of the MediKids Health Insurance Act of 2003 to guarantee every 
child in America the health coverage they need to grow up healthy.
  I stand before you today to deliver a message. That it is time to 
rekindle the discussion about how we are going to provide health 
insurance for all Americans. The bill I am introducing today--the 
MediKids Health Insurance Act of 2003--is a step toward eliminating the 
irrational and tragic lack of health insurance for so many children and 
adults in our country.
  Partial solutions to America's ``uninsured crisis'' lie before 
Congress, and I recognize the sense of realism and care that are the 
basis for proposing incremental steps towards universal coverage. As 
someone involved in the tough battles in years past to achieve 
universal coverage, I will continue to do all I can to make whatever 
progress can be made each and every year.
  But I also believe it is important to not lose sight of the ideal--
and our capacity to reach that ideal--of the United States of America 
joining every other industrialized nation by ensuring that its citizens 
have basic health insurance. Until we succeed, millions of children and 
adults will suffer human and financial costs that are preventable.
  Therefore, I offer this legislation to both enlist my colleagues in 
an effort to insist that all of our Nation's children are insured as 
quickly as possible and to lay out the steps that would achieve that 
goal. Some may say that we cannot afford this level of commitment to 
America's children in a time of war and economic downturn. I strongly 
disagree. We can fully fund MediKids with the more than $388 billion 
the President's budget proposes to spend on the dividend tax cut. I 
believe that choice is clear between providing 100 percent of our 
children with health care coverage and giving tax breaks to the 
wealthiest 2 percent of people in our country. I hope this bill will 
help to build the will and momentum so desperately needed by our 
children for action that will change their lives and

[[Page S3509]]

strengthen our Nation. I ask my colleagues from both sides of the aisle 
to join as co-sponsors.
  I ask unanimous consent that the text of this bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 588

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS; FINDINGS.

       (a) Short Title.--This Act may be cited as the ``MediKids 
     Health Insurance Act of 2003''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents; findings.
Sec. 2. Benefits for all children born after 2004.

                     ``TITLE XXII--MEDIKIDS PROGRAM

``Sec. 2201. Eligibility.
``Sec. 2202. Benefits.
``Sec. 2203. Premiums.
``Sec. 2204. MediKids Trust Fund.
``Sec. 2205. Oversight and accountability.
``Sec. 2206. Addition of care coordination services.
``Sec. 2207. Administration and miscellaneous.
Sec. 3. MediKids premium.
Sec. 4. Refundable credit for cost-sharing expenses under MediKids 
              program.
Sec. 5. Report on long-term revenues.
       (c) Findings.--Congress finds the following:
       (1) More than 9 million American children are uninsured.
       (2) Children who are uninsured receive less medical care 
     and less preventive care and have a poorer level of health, 
     which result in lifetime costs to themselves and to the 
     entire American economy.
       (3) Although SCHIP and Medicaid are successfully extending 
     a health coverage safety net to a growing portion of the 
     vulnerable low-income population of uninsured children, they 
     alone cannot achieve 100 percent health insurance coverage 
     for our nation's children due to inevitable gaps during 
     outreach and enrollment, fluctuations in eligibility, 
     variations in access to private insurance at all income 
     levels, and variations in States' ability to provide required 
     matching funds.
       (4) As all segments of society continue to become more 
     transient, with many changes in employment over the working 
     lifetime of parents, the need for a reliable safety net of 
     health insurance which follows children across State lines, 
     already a major problem for the children of migrant and 
     seasonal farmworkers, will become a major concern for all 
     families in the United States.
       (5) The medicare program has successfully evolved over the 
     years to provide a stable, universal source of health 
     insurance for the nation's disabled and those over age 65, 
     and provides a tested model for designing a program to reach 
     out to America's children
       (6) The problem of insuring 100 percent of all American 
     children could be gradually solved by automatically enrolling 
     all children born after December 31, 2004, in a program 
     modeled after Medicare (and to be known as ``MediKids''), and 
     allowing those children to be transferred into other 
     equivalent or better insurance programs, including either 
     private insurance, SCHIP, or Medicaid, if they are eligible 
     to do so, but maintaining the child's default enrollment in 
     MediKids for any times when the child's access to other 
     sources of insurance is lost.
       (7) A family's freedom of choice to use other insurers to 
     cover children would not be interfered with in any way, and 
     children eligible for SCHIP and Medicaid would continue to be 
     enrolled in those programs, but the underlying safety net of 
     MediKids would always be available to cover any gaps in 
     insurance due to changes in medical condition, employment, 
     income, or marital status, or other changes affecting a 
     child's access to alternate forms of insurance.
       (8) The MediKids program can be administered without 
     impacting the finances or status of the existing Medicare 
     program.
       (9) The MediKids benefit package can be tailored to the 
     special needs of children and updated over time.
       (10) The financing of the program can be administered 
     without difficulty by a yearly payment of affordable premiums 
     through a family's tax filing (or adjustment of a family's 
     earned income tax credit).
       (11) The cost of the program will gradually rise as the 
     number of children using MediKids as the insurer of last 
     resort increases, and a future Congress always can accelerate 
     or slow down the enrollment process as desired, while the 
     societal costs for emergency room usage, lost productivity 
     and work days, and poor health status for the next generation 
     of Americans will decline.
       (12) Over time 100 percent of American children will always 
     have basic health insurance, and we can therefore expect a 
     healthier, more equitable, and more productive society.

     SEC. 2. BENEFITS FOR ALL CHILDREN BORN AFTER 2004.

       (a) In General.--The Social Security Act is amended by 
     adding at the end the following new title:

                     ``TITLE XXII--MEDIKIDS PROGRAM

     ``SEC. 2201. ELIGIBILITY.

       ``(a) Eligibility of Individuals Born After December 31, 
     2004; All Children Under 23 Years of Age in Sixth Year.--An 
     individual who meets the following requirements with respect 
     to a month is eligible to enroll under this title with 
     respect to such month:
       ``(1) Age.--
       ``(A) First year.--During the first year in which this 
     title is effective, the individual has not attained 6 years 
     of age.
       ``(B) Second year.--During the second year in which this 
     title is effective, the individual has not attained 11 years 
     of age.
       ``(C) Third year.--During the third year in which this 
     title is effective, the individual has not attained 16 years 
     of age.
       ``(D) Fourth year.--During the fourth year in which this 
     title is effective, the individual has not attained 21 years 
     of age.
       ``(E) Fifth and subsequent years.--During the fifth year in 
     which this title is effective and each subsequent year, the 
     individual has not attained 23 years of age.
       ``(2) Citizenship.--The individual is a citizen or national 
     of the United States or is permanently residing in the United 
     States under color of law.
       ``(b) Enrollment Process.--An individual may enroll in the 
     program established under this title only in such manner and 
     form as may be prescribed by regulations, and only during an 
     enrollment period prescribed by the Secretary consistent with 
     the provisions of this section. Such regulations shall 
     provide a process under which--
       ``(1) individuals who are born in the United States after 
     December 31, 2004, are deemed to be enrolled at the time of 
     birth and a parent or guardian of such an individual is 
     permitted to pre-enroll in the month prior to the expected 
     month of birth;
       ``(2) individuals who are born outside the United States 
     after such date and who become eligible to enroll by virtue 
     of immigration into (or an adjustment of immigration status 
     in) the United States are deemed enrolled at the time of 
     entry or adjustment of status;
       ``(3) eligible individuals may otherwise be enrolled at 
     such other times and manner as the Secretary shall specify, 
     including the use of outstationed eligibility sites as 
     described in section 1902(a)(55)(A) and the use of 
     presumptive eligibility provisions like those described in 
     section 1920A; and
       ``(4) at the time of automatic enrollment of a child, the 
     Secretary provides for issuance to a parent or custodian of 
     the individual a card evidencing coverage under this title 
     and for a description of such coverage.
     The provisions of section 1837(h) apply with respect to 
     enrollment under this title in the same manner as they apply 
     to enrollment under part B of title XVIII.
       ``(c) Date Coverage Begins.--
       ``(1) In general.--The period during which an individual is 
     entitled to benefits under this title shall begin as follows, 
     but in no case earlier than January 1, 2005:
       ``(A) In the case of an individual who is enrolled under 
     paragraph (1) or (2) of subsection (b), the date of birth or 
     date of obtaining appropriate citizenship or immigration 
     status, as the case may be.
       ``(B) In the case of an another individual who enrolls 
     (including pre-enrolls) before the month in which the 
     individual satisfies eligibility for enrollment under 
     subsection (a), the first day of such month of eligibility.
       ``(C) In the case of an another individual who enrolls 
     during or after the month in which the individual first 
     satisfies eligibility for enrollment under such subsection, 
     the first day of the following month.
       ``(2) Authority to provide for partial months of 
     coverage.--Under regulations, the Secretary may, in the 
     Secretary's discretion, provide for coverage periods that 
     include portions of a month in order to avoid lapses of 
     coverage.
       ``(3) Limitation on payments.--No payments may be made 
     under this title with respect to the expenses of an 
     individual enrolled under this title unless such expenses 
     were incurred by such individual during a period which, with 
     respect to the individual, is a coverage period under this 
     section.
       ``(d) Expiration of Eligibility.--An individual's coverage 
     period under this part shall continue until the individual's 
     enrollment has been terminated because the individual no 
     longer meets the requirements of subsection (a) (whether 
     because of age or change in immigration status).
       ``(e) Entitlement to MediKids Benefits For Enrolled 
     Individuals.--An individual enrolled under this section is 
     entitled to the benefits described in section 2202.
       ``(f) Low-Income Information.--At the time of enrollment of 
     a child under this title, the Secretary shall make an inquiry 
     as to whether or not the family income of the family that 
     includes the child is less than 150 percent of the poverty 
     line for a family of the size involved. If the family income 
     is below such level, the Secretary shall encode in the 
     identification card issued in connection with eligibility 
     under this title a code indicating such fact. The Secretary 
     also shall provide for a toll-free telephone line at which 
     providers can verify whether or not such a child is in a 
     family the income of which is below such level.
       ``(g) Construction.--Nothing in this title shall be 
     construed as requiring (or preventing) an individual who is 
     enrolled under this section from seeking medical assistance 
     under a State medicaid plan under title XIX or child health 
     assistance under a State child health plan under title XXI.

[[Page S3510]]

     ``SEC. 2202. BENEFITS.

       ``(a) Secretarial Specification of Benefit Package.--
       ``(1) In general.--The Secretary shall specify the benefits 
     to be made available under this title consistent with the 
     provisions of this section and in a manner designed to meet 
     the health needs of enrollees.
       ``(2) Updating.--The Secretary shall update the 
     specification of benefits over time to ensure the inclusion 
     of age-appropriate benefits to reflect the enrollee 
     population.
       ``(3) Annual updating.--The Secretary shall establish 
     procedures for the annual review and updating of such 
     benefits to account for changes in medical practice, new 
     information from medical research, and other relevant 
     developments in health science.
       ``(4) Input.--The Secretary shall seek the input of the 
     pediatric community in specifying and updating such benefits.
       ``(5) Limitation on updating.--In no case shall updating of 
     benefits under this subsection result in a failure to provide 
     benefits required under subsection (b).
       ``(b) Inclusion of Certain Benefits.--
       ``(1) Medicare core benefits.--Such benefits shall include 
     (to the extent consistent with other provisions of this 
     section) at least the same benefits (including coverage, 
     access, availability, duration, and beneficiary rights) that 
     are available under parts A and B of title XVIII.
       ``(2) All required medicaid benefits.--Such benefits shall 
     also include all items and services for which medical 
     assistance is required to be provided under section 
     1902(a)(10)(A) to individuals described in such section, 
     including early and periodic screening, diagnostic services, 
     and treatment services.
       ``(3) Inclusion of prescription drugs.--Such benefits also 
     shall include (as specified by the Secretary) prescription 
     drugs and biologicals.
       ``(4) Cost-sharing.--
       ``(A) In general.--Subject to subparagraph (B), such 
     benefits also shall include the cost-sharing (in the form of 
     deductibles, coinsurance, and copayments) applicable under 
     title XVIII with respect to comparable items and services, 
     except that no cost-sharing shall be imposed with respect to 
     early and periodic screening and diagnostic services included 
     under paragraph (2).
       ``(B) No cost-sharing for lowest income children.--Such 
     benefits shall not include any cost-sharing for children in 
     families the income of which (as determined for purposes of 
     section 1905(p)) does not exceed 150 percent of the official 
     income poverty line (referred to in such section) applicable 
     to a family of the size involved.
       ``(C) Refundable credit for cost-sharing for other low-
     income children.--For a refundable credit for cost-sharing in 
     the case of children in certain families, see section 35 of 
     the Internal Revenue Code of 1986.
       ``(c) Payment Schedule.--The Secretary, with the assistance 
     of the Medicare Payment Advisory Commission, shall develop 
     and implement a payment schedule for benefits covered under 
     this title. To the extent feasible, such payment schedule 
     shall be consistent with comparable payment schedules and 
     reimbursement methodologies applied under parts A and B of 
     title XVIII.
       ``(d) Input.--The Secretary shall specify such benefits and 
     payment schedules only after obtaining input from appropriate 
     child health providers and experts.
       ``(e) Enrollment in Health Plans.--The Secretary shall 
     provide for the offering of benefits under this title through 
     enrollment in a health benefit plan that meets the same (or 
     similar) requirements as the requirements that apply to 
     Medicare+Choice plans under part C of title XVIII. In the 
     case of individuals enrolled under this title in such a plan, 
     the Medicare+Choice capitation rate described in section 
     1853(c) shall be adjusted in an appropriate manner to reflect 
     differences between the population served under this title 
     and the population under title XVIII.

     ``SEC. 2203. PREMIUMS.

       ``(a) Amount of Monthly Premiums.--
       ``(1) In general.--The Secretary shall, during September of 
     each year (beginning with 2004), establish a monthly MediKids 
     premium for the following year. Subject to paragraph (2), the 
     monthly MediKids premium for a year is equal to \1/12\ of the 
     annual premium rate computed under subsection (b).
       ``(2) Elimination of monthly premium for demonstration of 
     equivalent coverage (including coverage under low-income 
     programs).--The amount of the monthly premium imposed under 
     this section for an individual for a month shall be zero in 
     the case of an individual who demonstrates to the 
     satisfaction of the Secretary that the individual has basic 
     health insurance coverage for that month. For purposes of the 
     previous sentence enrollment in a medicaid plan under title 
     XIX, a State child health insurance plan under title XXI, or 
     under the medicare program under title XVIII is deemed to 
     constitute basic health insurance coverage described in such 
     sentence.
       ``(b) Annual Premium.--
       ``(1) National, per capita average.--The Secretary shall 
     estimate the average, annual per capita amount that would be 
     payable under this title with respect to individuals residing 
     in the United States who meet the requirement of section 
     2201(a)(1) as if all such individuals were eligible for (and 
     enrolled) under this title during the entire year (and 
     assuming that section 1862(b)(2)(A)(i) did not apply).
       ``(2) Annual premium.--Subject to subsection (d), the 
     annual premium under this subsection for months in a year is 
     equal to 25 percent of the average, annual per capita amount 
     estimated under paragraph (1) for the year.
       ``(c) Payment of Monthly Premium.--
       ``(1) Period of payment.--In the case of an individual who 
     participates in the program established by this title, 
     subject to subsection (d), the monthly premium shall be 
     payable for the period commencing with the first month of the 
     individual's coverage period and ending with the month in 
     which the individual's coverage under this title terminates.
       ``(2) Collection through tax return.--For provisions 
     providing for the payment of monthly premiums under this 
     subsection, see section 59B of the Internal Revenue Code of 
     1986.
       ``(3) Protections against fraud and abuse.--The Secretary 
     shall develop, in coordination with States and other health 
     insurance issuers, administrative systems to ensure that 
     claims which are submitted to more than one payor are 
     coordinated and duplicate payments are not made.
       ``(d) Reduction in Premium for Certain Low-Income 
     Families.--For provisions reducing the premium under this 
     section for certain low-income families, see section 59B(c) 
     of the Internal Revenue Code of 1986.

     ``SEC. 2204. MEDIKIDS TRUST FUND.

       ``(a) Establishment of Trust Fund.--
       ``(1) In general.--There is hereby created on the books of 
     the Treasury of the United States a trust fund to be known as 
     the `MediKids Trust Fund' (in this section referred to as the 
     `Trust Fund'). The Trust Fund shall consist of such gifts and 
     bequests as may be made as provided in section 201(i)(1) and 
     such amounts as may be deposited in, or appropriated to, such 
     fund as provided in this title.
       ``(2) Premiums.--Premiums collected under section 2203 
     shall be transferred to the Trust Fund.
       ``(b) Incorporation of Provisions.--
       ``(1) In general.--Subject to paragraph (2), subsections 
     (b) through (i) of section 1841 shall apply with respect to 
     the Trust Fund and this title in the same manner as they 
     apply with respect to the Federal Supplementary Medical 
     Insurance Trust Fund and part B, respectively.
       ``(2) Miscellaneous references.--In applying provisions of 
     section 1841 under paragraph (1)--
       ``(A) any reference in such section to `this part' is 
     construed to refer to title XXII;
       ``(B) any reference in section 1841(h) to section 1840(d) 
     and in section 1841(i) to sections 1840(b)(1) and 1842(g) are 
     deemed references to comparable authority exercised under 
     this title;
       ``(C) payments may be made under section 1841(g) to the 
     Trust Funds under sections 1817 and 1841 as reimbursement to 
     such funds for payments they made for benefits provided under 
     this title; and
       ``(D) the Board of Trustees of the MediKids Trust Fund 
     shall be the same as the Board of Trustees of the Federal 
     Supplementary Medical Insurance Trust Fund.

     ``SEC. 2205. OVERSIGHT AND ACCOUNTABILITY.

       ``(a) Through Annual Reports of Trustees.--The Board of 
     Trustees of the MediKids Trust Fund under section 2204(b)(1) 
     shall report on an annual basis to Congress concerning the 
     status of the Trust Fund and the need for adjustments in the 
     program under this title to maintain financial solvency of 
     the program under this title.
       ``(b) Periodic GAO Reports.--The Comptroller General of the 
     United States shall periodically submit to Congress reports 
     on the adequacy of the financing of coverage provided under 
     this title. The Comptroller General shall include in such 
     report such recommendations for adjustments in such financing 
     and coverage as the Comptroller General deems appropriate in 
     order to maintain financial solvency of the program under 
     this title.

     ``SEC. 2206. INCLUSION OF CARE COORDINATION SERVICES.

       ``(a) In General.--
       ``(1) Program authority.--The Secretary, beginning in 2005, 
     may implement a care coordination services program in 
     accordance with the provisions of this section under which, 
     in appropriate circumstances, eligible individuals may elect 
     to have health care services covered under this title managed 
     and coordinated by a designated care coordinator.
       ``(2) Administration by contract.--The Secretary may 
     administer the program under this section through a contract 
     with an appropriate program administrator.
       ``(3) Coverage.--Care coordination services furnished in 
     accordance with this section shall be treated under this 
     title as if they were included in the definition of medical 
     and other health services under section 1861(s) and benefits 
     shall be available under this title with respect to such 
     services without the application of any deductible or 
     coinsurance.
       ``(b) Eligibility Criteria; Identification and Notification 
     of Eligible Individuals.--
       ``(1) Individual eligibility criteria.--The Secretary shall 
     specify criteria to be used in making a determination as to 
     whether an individual may appropriately be enrolled in the 
     care coordination services program under this section, which 
     shall include at least a finding by the Secretary that for 
     cohorts of individuals with characteristics

[[Page S3511]]

     identified by the Secretary, professional management and 
     coordination of care can reasonably be expected to improve 
     processes or outcomes of health care and to reduce aggregate 
     costs to the programs under this title.
       ``(2) Procedures to facilitate enrollment.--The Secretary 
     shall develop and implement procedures designed to facilitate 
     enrollment of eligible individuals in the program under this 
     section.
       ``(c) Enrollment of Individuals.--
       ``(1) Secretary's determination of eligibility.--The 
     Secretary shall determine the eligibility for services under 
     this section of individuals who are enrolled in the program 
     under this section and who make application for such services 
     in such form and manner as the Secretary may prescribe.
       ``(2) Enrollment period.--
       ``(A) Effective date and duration.--Enrollment of an 
     individual in the program under this section shall be 
     effective as of the first day of the month following the 
     month in which the Secretary approves the individual's 
     application under paragraph (1), shall remain in effect for 
     one month (or such longer period as the Secretary may 
     specify), and shall be automatically renewed for additional 
     periods, unless terminated in accordance with such procedures 
     as the Secretary shall establish by regulation. Such 
     procedures shall permit an individual to disenroll for cause 
     at any time and without cause at re-enrollment intervals.
       ``(B) Limitation on reenrollment.--The Secretary may 
     establish limits on an individual's eligibility to reenroll 
     in the program under this section if the individual has 
     disenrolled from the program more than once during a 
     specified time period.
       ``(d) Program.--The care coordination services program 
     under this section shall include the following elements:
       ``(1) Basic care coordination services.--
       ``(A) In general.--Subject to the cost-effectiveness 
     criteria specified in subsection (b)(1), except as otherwise 
     provided in this section, enrolled individuals shall receive 
     services described in section 1905(t)(1) and may receive 
     additional items and services as described in subparagraph 
     (B).
       ``(B) Additional benefits.--The Secretary may specify 
     additional benefits for which payment would not otherwise be 
     made under this title that may be available to individuals 
     enrolled in the program under this section (subject to an 
     assessment by the care coordinator of an individual's 
     circumstance and need for such benefits) in order to 
     encourage enrollment in, or to improve the effectiveness of, 
     such program.
       ``(2) Care coordination requirement.--Notwithstanding any 
     other provision of this title, the Secretary may provide that 
     an individual enrolled in the program under this section may 
     be entitled to payment under this title for any specified 
     health care items or services only if the items or services 
     have been furnished by the care coordinator, or coordinated 
     through the care coordination services program. Under such 
     provision, the Secretary shall prescribe exceptions for 
     emergency medical services as described in section 
     1852(d)(3), and other exceptions determined by the Secretary 
     for the delivery of timely and needed care.
       ``(e) Care Coordinators.--
       ``(1) Conditions of participation.--In order to be 
     qualified to furnish care coordination services under this 
     section, an individual or entity shall--
       ``(A) be a health care professional or entity (which may 
     include physicians, physician group practices, or other 
     health care professionals or entities the Secretary may find 
     appropriate) meeting such conditions as the Secretary may 
     specify;
       ``(B) have entered into a care coordination agreement; and
       ``(C) meet such criteria as the Secretary may establish 
     (which may include experience in the provision of care 
     coordination or primary care physician's services).
       ``(2) Agreement term; payment.--
       ``(A) Duration and renewal.--A care coordination agreement 
     under this subsection shall be for one year and may be 
     renewed if the Secretary is satisfied that the care 
     coordinator continues to meet the conditions of participation 
     specified in paragraph (1).
       ``(B) Payment for services.--The Secretary may negotiate or 
     otherwise establish payment terms and rates for services 
     described in subsection (d)(1).
       ``(C) Liability.--Case coordinators shall be subject to 
     liability for actual health damages which may be suffered by 
     recipients as a result of the care coordinator's decisions, 
     failure or delay in making decisions, or other actions as a 
     care coordinator.
       ``(D) Terms.--In addition to such other terms as the 
     Secretary may require, an agreement under this section shall 
     include the terms specified in subparagraphs (A) through (C) 
     of section 1905(t)(3).

     ``SEC. 2207. ADMINISTRATION AND MISCELLANEOUS.

       ``(a) In General.--Except as otherwise provided in this 
     title--
       ``(1) the Secretary shall enter into appropriate contracts 
     with providers of services, other health care providers, 
     carriers, and fiscal intermediaries, taking into account the 
     types of contracts used under title XVIII with respect to 
     such entities, to administer the program under this title;
       ``(2) individuals enrolled under this title shall be 
     treated for purposes of title XVIII as though the individual 
     were entitled to benefits under part A and enrolled under 
     part B of such title;
       ``(3) benefits described in section 2202 that are payable 
     under this title to such individuals shall be paid in a 
     manner specified by the Secretary (taking into account, and 
     based to the greatest extent practicable upon, the manner in 
     which they are provided under title XVIII);
       ``(4) provider participation agreements under title XVIII 
     shall apply to enrollees and benefits under this title in the 
     same manner as they apply to enrollees and benefits under 
     title XVIII; and
       ``(5) individuals entitled to benefits under this title may 
     elect to receive such benefits under health plans in a 
     manner, specified by the Secretary, similar to the manner 
     provided under part C of title XVIII.
       ``(b) Coordination With Medicaid and SCHIP.--
     Notwithstanding any other provision of law, individuals 
     entitled to benefits for items and services under this title 
     who also qualify for benefits under title XIX or XXI or any 
     other Federally funded program may continue to qualify and 
     obtain benefits under such other title or program, and in 
     such case such an individual shall elect either--
       ``(1) such other title or program to be primary payor to 
     benefits under this title, in which case no benefits shall be 
     payable under this title and the monthly premium under 
     section 2203 shall be zero; or
       ``(2) benefits under this title shall be primary payor to 
     benefits provided under such program or title, in which case 
     the Secretary shall enter into agreements with States as may 
     be appropriate to provide that, in the case of such 
     individuals, the benefits under titles XIX and XXI or such 
     other program (including reduction of cost-sharing) are 
     provided on a `wrap-around' basis to the benefits under this 
     title.''.
       (b) Conforming Amendments to Social Security Act 
     Provisions.--
       (1) Section 201(i)(1) of the Social Security Act (42 U.S.C. 
     401(i)(1)) is amended by striking ``or the Federal 
     Supplementary Medical Insurance Trust Fund'' and inserting 
     ``the Federal Supplementary Medical Insurance Trust Fund, and 
     the MediKids Trust Fund''.
       (2) Section 201(g)(1)(A) of such Act (42 U.S.C. 
     401(g)(1)(A)) is amended by striking `` and the Federal 
     Supplementary Medical Insurance Trust Fund established by 
     title XVIII'' and inserting ``, the Federal Supplementary 
     Medical Insurance Trust Fund, and the MediKids Trust Fund 
     established by title XVIII''.
       (3) Section 1853(c) of such Act (42 U.S.C. 1395w-23(c)) is 
     amended--
       (A) in paragraph (1), by striking ``or (7)'' and inserting 
     ``, (7), or (8)'', and
       (B) by adding at the end the following:
       ``(8) Adjustment for medikids.--In applying this subsection 
     with respect to individuals entitled to benefits under title 
     XXII, the Secretary shall provide for an appropriate 
     adjustment in the Medicare+Choice capitation rate as may be 
     appropriate to reflect differences between the population 
     served under such title and the population under parts A and 
     B.''.
       (c) Maintenance of Medicaid Eligibility and Benefits for 
     Children.--
       (1) In general.--In order for a State to continue to be 
     eligible for payments under section 1903(a) of the Social 
     Security Act (42 U.S.C. 1396b(a))--
       (A) the State may not reduce standards of eligibility, or 
     benefits, provided under its State medicaid plan under title 
     XIX of the Social Security Act or under its State child 
     health plan under title XXI of such Act for individuals under 
     23 years of age below such standards of eligibility, and 
     benefits, in effect on the date of the enactment of this Act; 
     and
       (B) the State shall demonstrate to the satisfaction of the 
     Secretary of Health and Human Services that any savings in 
     State expenditures under title XIX or XXI of the Social 
     Security Act that results from children from enrolling under 
     title XXII of such Act shall be used in a manner that 
     improves services to beneficiaries under title XIX of such 
     Act, such as through increases in provider payment rates, 
     expansion of eligibility, improved nurse and nurse aide 
     staffing and improved inspections of nursing facilities, and 
     coverage of additional services.
       (2) Medikids as primary payor.--In applying title XIX of 
     the Social Security Act, the MediKids program under title 
     XXII of such Act shall be treated as a primary payor in cases 
     in which the election described in section 2207(b)(2) of such 
     Act, as added by subsection (a), has been made.
       (d) Expansion of MedPAC Membership to 19.--
       (1) In general.--Section 1805(c) of the Social Security Act 
     (42 U.S.C. 1395b-6(c)) is amended--
       (A) in paragraph (1), by striking ``17'' and inserting 
     ``19''; and
       (B) in paragraph (2)(B), by inserting ``experts in 
     children's health,'' after ``other health professionals,''.
       (2) Initial terms of additional members.--
       (A) In general.--For purposes of staggering the initial 
     terms of members of the Medicare Payment Advisory Commission 
     under section 1805(c)(3) of the Social Security Act (42 
     U.S.C. 1395b-6(c)(3)), the initial terms of the 2 additional 
     members of the Commission provided for by the amendment under 
     subsection (a)(1) are as follows:
       (i) One member shall be appointed for 1 year.
       (ii) One member shall be appointed for 2 years.

[[Page S3512]]

       (B) Commencement of terms.--Such terms shall begin on 
     January 1, 2004.

     SEC. 3. MEDIKIDS PREMIUM.

       (a) General Rule.--Subchapter A of chapter 1 of the 
     Internal Revenue Code of 1986 (relating to determination of 
     tax liability) is amended by adding at the end the following 
     new part:

                     ``PART VIII--MEDIKIDS PREMIUM

``Sec. 59B. MediKids premium.

     ``SEC. 59B. MEDIKIDS PREMIUM.

       ``(a) Imposition of Tax.--In the case of an individual to 
     whom this section applies, there is hereby imposed (in 
     addition to any other tax imposed by this subtitle) a 
     MediKids premium for the taxable year.
       ``(b) Individuals Subject to Premium.--
       ``(1) In general.--This section shall apply to an 
     individual if the taxpayer has a MediKid at any time during 
     the taxable year.
       ``(2) Medikid.--For purposes of this section, the term 
     `MediKid' means, with respect to a taxpayer, any individual 
     with respect to whom the taxpayer is required to pay a 
     premium under section 2203(c) of the Social Security Act for 
     any month of the taxable year.
       ``(c) Amount of Premium.--For purposes of this section, the 
     MediKids premium for a taxable year is the sum of the monthly 
     premiums under section 2203 of the Social Security Act for 
     months in the taxable year.
       ``(d) Exceptions Based on Adjusted Gross Income.--
       ``(1) Exemption for very low-income taxpayers.--
       ``(A) In general.--No premium shall be imposed by this 
     section on any taxpayer having an adjusted gross income not 
     in excess of the exemption amount.
       ``(B) Exemption amount.--For purposes of this paragraph, 
     the exemption amount is--
       ``(i) $17,910 in the case of a taxpayer having 1 MediKid,
       ``(ii) $22,530 in the case of a taxpayer having 2 MediKids,
       ``(iii) $27,150 in the case of a taxpayer having 3 
     MediKids, and
       ``(iv) $31,770 in the case of a taxpayer having 4 or more 
     MediKids.
       ``(C) Phaseout of exemption.--In the case of a taxpayer 
     having an adjusted gross income which exceeds the exemption 
     amount but does not exceed twice the exemption amount, the 
     premium shall be the amount which bears the same ratio to the 
     premium which would (but for this subparagraph) apply to the 
     taxpayer as such excess bears to the exemption amount.
       ``(D) Inflation adjustment of exemption amounts.--In the 
     case of any taxable year beginning in a calendar year after 
     2002, each dollar amount contained in subparagraph (C) shall 
     be increased by an amount equal to the product of--
       ``(i) such dollar amount, and
       ``(ii) the cost-of-living adjustment determined under 
     section 1(f)(3) for the calendar year in which the taxable 
     year begins, determined by substituting `calendar year 2001' 
     for `calendar year 1992' in subparagraph (B) thereof.
     If any increase determined under the preceding sentence is 
     not a multiple of $50, such increase shall be rounded to the 
     nearest multiple of $50.
       ``(2) Premium limited to 5 percent of adjusted gross 
     income.--In no event shall any taxpayer be required to pay a 
     premium under this section in excess of an amount equal to 5 
     percent of the taxpayer's adjusted gross income.
       ``(e) Coordination With Other Provisions.--
       ``(1) Not treated as medical expense.--For purposes of this 
     chapter, any premium paid under this section shall not be 
     treated as expense for medical care.
       ``(2) Not treated as tax for certain purposes.--The premium 
     paid under this section shall not be treated as a tax imposed 
     by this chapter for purposes of determining--
       ``(A) the amount of any credit allowable under this 
     chapter, or
       ``(B) the amount of the minimum tax imposed by section 55.
       ``(3) Treatment under subtitle f.--For purposes of subtitle 
     F, the premium paid under this section shall be treated as if 
     it were a tax imposed by section 1.''.
       (b) Technical Amendments.--
       (1) Subsection (a) of section 6012 of such Code is amended 
     by inserting after paragraph (9) the following new paragraph:
       ``(10) Every individual liable for a premium under section 
     59B.''.
       (2) The table of parts for subchapter A of chapter 1 of 
     such Code is amended by adding at the end the following new 
     item:

``Part VIII. MediKids premium.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to months beginning after December 2004, in 
     taxable years ending after such date.

     SEC. 4. REFUNDABLE CREDIT FOR COST-SHARING EXPENSES UNDER 
                   MEDIKIDS PROGRAM.

       (a) In General.--Subpart C of part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 (relating to 
     refundable credits) is amended by redesignating section 36 as 
     section 37 and by inserting after section 35 the following 
     new section:

     ``SEC. 36. COST-SHARING EXPENSES UNDER MEDIKIDS PROGRAM.

       ``(a) Allowance of Credit.--In the case of an individual 
     who has a MediKid (as defined in section 59B) at any time 
     during the taxable year, there shall be allowed as a credit 
     against the tax imposed by this subtitle an amount equal to 
     50 percent of the amount paid by the taxpayer during the 
     taxable year as cost-sharing under section 2202(b)(4) of the 
     Social Security Act.
       ``(b) Limitation Based on Adjusted Gross Income.--The 
     amount of the credit which would (but for this subsection) be 
     allowed under this section for the taxable year shall be 
     reduced (but not below zero) by an amount which bears the 
     same ratio to such amount of credit as the excess of the 
     taxpayer's adjusted gross income for such taxable year over 
     the exemption amount (as defined in section 59B(d)) bears to 
     such exemption amount.''.
       (b) Technical Amendments.--
       (1) Paragraph (2) of section 1324(b) of title 31, United 
     States Code, is amended by inserting before the period ``or 
     from section 36 of such Code''.
       (2) The table of sections for subpart C of part IV of 
     subchapter A of chapter 1 of such Code is amended by striking 
     the last item and inserting the following new items:

``Sec. 36. Cost-sharing expenses under MediKids program.
``Sec. 37. Overpayments of tax.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2004.

     SEC. 5. REPORT ON LONG-TERM REVENUES.

       Within one year after the date of the enactment of this 
     Act, the Secretary of the Treasury shall propose a gradual 
     schedule of progressive tax changes to fund the program under 
     title XXII of the Social Security Act, as the number of 
     enrollees grows in the out-years.
                                 ______