[Congressional Record Volume 149, Number 102 (Friday, July 11, 2003)]
[Senate]
[Pages S9304-S9306]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. HARKIN (for himself, Mr. Smith, Mr. Kennedy, Mr. 
        Lautenberg, and Mr. Kerry):
  S. 1394. A bill to establish a demonstration project under the 
medicaid program to encourage the provision of community-based services 
to individuals with disabilities; to the Committee on Finance.
  Mr. HARKIN. Mr. President, today, Senator Smith and I and others 
introduce the Money Follows the Person Act of 2003. This legislation is 
needed to truly bring people with disabilities and older Americans into 
the mainstream of society and provide equal opportunity for employment 
and community activities.
  In order to work or live in their own homes, Americans with 
Disabilities and older Americans need access to community-based 
services and supports. Unfortunately, under current Federal Medicaid 
policy, the deck is stacked in favor of living in an institution. The 
purpose of our bill is to level the playing field and give eligible 
individuals equal access to community-based services and supports.
  Under our legislation, the Medicaid money paid by States and the 
Federal Government would follow the person with a disability from an 
institution into the community. This legislation provides 100 percent 
Federal reimbursement for the community services that an individual 
needs during the first year that they move out of an institution or 
nursing home. By fully reimbursing the States, it gives them some 
additional resources to allow people with disabilities and older 
Americans to choose to live in the community.
  President Bush first proposed the Money Follows the Person 
Rebalancing Initiative in his FY '04 budget and indicated that the 
demonstration project would provide full Federal reimbursement for 
community services for the first year that an individual moves out of 
an institution or nursing home. As of this date, the administration has 
not suggested legislative language to Congress or provided specific 
details regarding the implementation of the proposal. Working with the 
disability community, we have drafted this legislation and look forward 
to working with the administration and our colleagues to enact the 
Money Follows the Person concept into law.
  We have a Medicaid system in this country that is spending 70 percent 
of its dollars on institutional care and only 30 percent on community 
services. This bill is an important step toward switching those numbers 
around.
  It is shameful that our Federal dollars are being spent to segregate 
people, not integrate them. It has been 13 years since we passed the 
Americans with Disabilities Act, which said no to segregation. But our 
Medicaid program says yes and we need to change it. This is the next 
civil rights battle. If we really meant what we said in the ADA in 
1990, we should enact this legislation.
  The civil right of a person with a disability to be integrated into 
his or her community should not depend on his or her address. In 
Olmstead v. LC, the Supreme Court recognized that needless 
institutionalization is a form of discrimination under the Americans 
with Disabilities Act. We in Congress have a responsibility to help 
States meet their obligations under Olmstead. An individual should not 
be asked to move to another state in order to avoid needless segration. 
They also should not be moved away from family and friends because 
their only choice is an institution.
  For example, I know a young man in Iowa, Ken Kendall, who is 
currently living in a nursing home because he cannot access home and 
community based care. Ken was injured in a serious accident at the age 
of 17 and sustained a spinal chord injury. With the help of community 
based services covered by his insurance company, Ken could live in his 
home in Iowa City. Remaining independent made a tremendous difference 
in his life.
  However, several years ago, Ken lost his health insurance and after a 
time, he went onto Medicaid. As a Medicaid recipient, Ken was only 
given the option to live in a nursing home in Waterloo almost 2 hours 
from his friends and family in Iowa City. In the nursing home, Ken has 
become isolated. He is very far from his family and friends and does 
not have access to transportation. He had not been to a restaurant or a 
movie since he moved to the nursing home over 2 years ago. His life has 
dramatically changed from when he lived in his own apartment and hired 
his own attendants to care for him.
  Recently Ken wrote to me that he finally went to dinner and a movie 
for his 30th birthday. He said ``I was almost in tears. I felt like I 
had a real life again.''
  This bill would give people like Ken a real life and not just on 
their birthdays. People like Ken should not have to continue waiting to 
be able to live in the community and enjoy the opportunities that other 
Americans take for granted.
  Federal Medicaid policy should reflect the consensus reached in the 
ADA that Americans with Disabilities should have equal opportunity to 
contribute to our communities and participate in our society as full 
citizens. That means no one has to sacrifice their full participation 
in society because they need help getting out of the house in the 
morning or assistance with personal care or some other basic service.
  This bill will open the door to full participation by people with 
disabilities and older Americans in our neighborhoods, our communities, 
our workplaces, and our American Dream, and I urge all my colleagues to 
support us on this issue. I want to thank Senator Smith for his 
commitment to improving access to home and community based services for 
people with disabilities. I would also like to thank Senators Kennedy, 
Lautenberg and Kerry for joining me in this important initiative.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1394

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

[[Page S9305]]

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Money Follows the Person Act 
     of 2003''.

     SEC. 2. FINDINGS.

       Congress makes the following findings:
       (1) In his budget for fiscal year 2004, President George W. 
     Bush proposes a ``Money Follows the Person'' rebalancing 
     initiative under the medicaid program to help States 
     rebalance their long-term services support systems more 
     evenly between institutional and community-based services.
       (2) The President, by proposing this initiative, and 
     Congress, recognize that States have not fully developed the 
     systems needed to create a more equitable balance between 
     institutional and community-based services spending under the 
     medicaid program.
       (3) While a few States have been successful at achieving 
     this balance, nationally, approximately 70 percent of the 
     medicaid funding spent for long-term services is devoted to 
     nursing facilities and intermediate care facilities for the 
     mentally retarded. Only 30 percent of such funding is spent 
     for community-based services.
       (4) As a result, there are often long waiting lists for 
     community-based services and supports.
       (5) In the Americans with Disabilities Act of 1990, 
     Congress found that individuals with disabilities continue to 
     encounter various forms of discrimination, including 
     segregation, and that discrimination persists in such 
     critical areas as institutionalization.
       (6) In 1999, the Supreme Court held in Olmstead v. LC (527 
     U.S. 581 (1999)) that needless institutionalization is 
     discrimination under the Americans with Disabilities Act of 
     1990, noting that institutional placement of people who can 
     be served in the community ``perpetuates unwarranted 
     assumptions that persons so isolated are unworthy of 
     participating in community life.'' (Id. at 600). The Court 
     further found that ``confinement in an institution severely 
     diminishes the everyday life activities of individuals, 
     including family relations, social contacts, work options, 
     economic independence, educational advancement, and cultural 
     enrichment.'' (Id. at 601).
       (7) Additional resources would be helpful for assisting 
     States in rebalancing their long-term services support system 
     and complying with the Olmstead decision.

     SEC. 3. AUTHORITY TO CONDUCT MEDICAID DEMONSTRATION PROJECTS.

       (a) Definitions.--In this section:
       (1) Community-based services and supports.--The term 
     ``community-based services and supports'' means, with respect 
     to a State, any items or services that are an allowable 
     expenditure for medical assistance under the State medicaid 
     program, or under a waiver of such program and that the State 
     determines would allow an individual to live in the 
     community.
       (2) Individual's representative; representative.--The terms 
     ``individual's representative'' and ``representative'' mean a 
     parent, family member, guardian, advocate, or authorized 
     representative of an individual.
       (3) Medicaid long-term care facility.--The term ``medicaid 
     long-term care facility'' means a hospital, nursing facility, 
     or intermediate care facility for the mentally retarded, as 
     such terms are defined for purposes of the medicaid program.
       (4) Medicaid program.--The term ``medicaid program'' means 
     the State medical assistance program established under title 
     XIX of the Social Security Act (42 U.S.C. 1396 et seq.).
       (5) Secretary.--The term ``Secretary'' means the Secretary 
     of Health and Human Services.
       (6) State.--The term ``State'' has the meaning given such 
     term for purposes of the medicaid program.
       (b) State Application.--A State may apply to the Secretary 
     for approval to conduct a demonstration project under which 
     the State shall provide community-based services and supports 
     to individuals--
       (1) who are eligible for medical assistance under the 
     medicaid program;
       (2) who are residing in a medicaid long-term care facility 
     and who have resided in such facility for at least 90 days; 
     and
       (3) with respect to whom there has been a determination 
     that but for the provision of community-based services and 
     supports, the individuals would continue to require the level 
     of care provided in a medicaid long-term care facility.
       (c) Requirements.--A State is not eligible to conduct a 
     demonstration project under this section unless the State 
     certifies the following:
       (1) With respect to any individual provided community-based 
     services and supports under the demonstration project, the 
     State shall continue to provide community-based services and 
     supports to the individual under the medicaid program (and at 
     the State's Federal medical assistance percentage (as defined 
     in section 1905(b) of the Social Security Act) reimbursement 
     rate), for as long as the individual remains eligible for 
     medical assistance under the State medicaid program and 
     continues to require such services and supports, beginning 
     with the month that begins after the 12-month period in which 
     the individual is provided such services and supports under 
     the demonstration project.
       (2) The State shall allow an individual participating in 
     the demonstration project (or, as appropriate, the 
     individual's representative) to choose the setting in which 
     the individual desires to receives the community-based 
     services and supports provided under the project.
       (3) The State shall identify and educate individuals 
     residing in a medicaid long-term care facility who are 
     eligible to participate in the demonstration project (and, as 
     appropriate the individual's representative) about the 
     opportunity for the individual to receive community-based 
     services and supports under the demonstration project.
       (4) The State shall ensure that each individual identified 
     in accordance with paragraph (3) (and, as appropriate, the 
     individual's representative), has the opportunity, 
     information, and tools to make an informed choice regarding 
     whether to transition to the community through participation 
     in the demonstration project or to remain in the medicaid 
     long-term care facility.
       (5) The State shall maintain an adequate quality 
     improvement system so that individuals participating in the 
     demonstration project receive adequate services and supports.
       (6) The State shall conduct a process for public 
     participation in the design and development of the 
     demonstration project and such process shall include the 
     participation of individuals with disabilities, elderly 
     individuals, or individuals with chronic conditions who are 
     part of the target populations to be served by the 
     demonstration project, and the representatives of such 
     individuals.
       (7) The Federal funds paid to a State pursuant to this 
     section shall only supplement, and shall not supplant, the 
     level of State funds expended for providing community-based 
     services and supports for individuals under the State 
     medicaid program as of the date the State application to 
     conduct a demonstration project under this section is 
     approved.
       (d) Approval of Demonstration Projects.--
       (1) In general.--Subject to paragraph (2), the Secretary 
     shall conduct a competitive application process with respect 
     to applications submitted under subsection (b) (taking into 
     consideration the preferences provided under paragraph (2)) 
     that meet the requirements of subsection (c). In determining 
     whether to approve such an application, the Secretary may 
     waive the requirement of--
       (A) section 1902(a)(1) of the Social Security Act (42 
     U.S.C. 1396a(a)(1)) to allow for sub-State demonstrations;
       (B) section 1902(a)(10)(B) of such Act (42 U.S.C. 
     1396a(a)(10)(B)) with respect to comparability; and
       (C) section 1902(a)(10)(C)(i)(III) of such Act (42 U.S.C. 
     1396a(a)(10)(C)(i)(III)) with respect to income and resource 
     limitations.
       (2) Preference for certain applications.--In approving 
     applications to conduct demonstration projects under this 
     section, the Secretary shall give preference to approving 
     applications that indicate that the State shall do the 
     following:
       (A) Design and implement enduring improvements in 
     community-based long-term services support systems within the 
     State to enable individuals with disabilities to live and 
     participate in community life, particularly with respect to 
     those practices that will ensure the successful transition of 
     such individuals from medicaid long-term care facilities into 
     the community.
       (B) Design and implement a long-term services support 
     system in the State that prevents individuals from entering 
     medicaid long-term care facilities in order to gain access to 
     community-based services and supports.
       (C) Engage in systemic reform activities within the State 
     to rebalance expenditures for long-term services under the 
     State medicaid program through administrative actions that 
     reduce reliance on institutional forms of service and build 
     up more community capacity.
       (D) Address the needs of populations that have been 
     underserved with respect to the availability of community 
     services or involve individuals or entities that have not 
     previously participated in the efforts of the State to 
     increase access to community-based services.
       (E) Actively engage in collaboration between public housing 
     agencies, the State medicaid agency, independent living 
     centers, and other agencies and entities in order to 
     coordinate strategies for obtaining community integrated 
     housing and supportive services for an individual who 
     participates in the demonstration project, both with respect 
     to the period during which such individual participates in 
     the project and after the individual's participation in the 
     project concludes, in order to enable the individual to 
     continue to reside in the community.
       (F) Develop and implement policies and procedures that 
     allow the State medicaid agency to administratively transfer 
     or integrate funds from the State budget accounts that are 
     obligated for expenditures for medicaid long-term care 
     facilities to other accounts for obligation for the provision 
     of community-based services and supports (including accounts 
     related to the provision of such services under a waiver 
     approved under section 1915 of the Social Security Act (42 
     U.S.C. 1396n)) when an individual transitions from residing 
     in such a facility to residing in the community.
       (e) Payments to States.--
       (1) In general.--The Secretary shall pay to each State with 
     a demonstration project approved under this section an amount 
     for each quarter occurring during the period described in 
     paragraph (2) equal to 100 percent of the State's 
     expenditures in the quarter for providing community-based 
     services and

[[Page S9306]]

     supports to individuals participating in the demonstration 
     project.
       (2) Period described.--The period described in this 
     paragraph is the 12-month period that begins on the date on 
     which an individual first receives community-based services 
     and supports under the demonstration project in a setting 
     that is not a medicaid long-term care facility and is 
     selected by the individual.
       (f) Reports.--
       (1) In general.--Each State conducting a demonstration 
     project under this section shall submit a report to the 
     Secretary that, in addition to such other requirements as the 
     Secretary may require, includes information regarding--
       (A) the types of community-based services and supports 
     provided under the demonstration project;
       (B) the number of individuals served under the project;
       (C) the expenditures for, and savings resulting from, 
     conducting the project; and
       (D) to the extent applicable, the changes in State's long-
     term services system developed in accordance with the 
     provisions of subsection (d)(2).
       (2) Uniform data format.--In requiring information under 
     this subsection, the Secretary shall develop a uniform data 
     format to be used by States in the collection and submission 
     of data in the State report required under paragraph (1).
       (g) Evaluations.--The Secretary shall use an amount, not to 
     exceed one-half of 1 percent of the amount appropriated under 
     subsection (h) for each fiscal year, to provide, directly or 
     through contract--
       (1) for the evaluation of the demonstration projects 
     conducted under this section;
       (2) technical assistance to States concerning the 
     development or implementation of such projects; and
       (3) for the collection of the data described in subsection 
     (f)(1).
       (h) Funding.--
       (1) In general.--There is appropriated to carry out this 
     section $350,000,000 for each of fiscal years 2004 through 
     2008.
       (2) Availability.--Funds appropriated under paragraph (1) 
     for a fiscal year shall remain available until expended, but 
     not later than September 30, 2008.
                                 ______