STATE OPTION FOR ALTERNATIVE MEDICAID PREMIUMS AND COST SHARING.

SEC. 6041. STATE OPTION FOR ALTERNATIVE MEDICAID PREMIUMS AND COST SHARING.(a) In General.—Title XIX of the Social Security Act is amended by inserting after section 1916 the following new section:“State option for alternative premiums and cost sharing“Sec. 1916A. (a) State Flexibility.—“(1) In general.—Notwithstanding sections 1916 and 1902(a)(10)(B), a State, at its option and through a State plan 120 STAT. 82 amendment, may impose premiums and cost sharing for any group of individuals (as specified by the State) and for any type of services (other than drugs for which cost sharing may be imposed under subsection (c)), and may vary such premiums and cost sharing among such groups or types, consistent with the limitations established under this section. Nothing in this section shall be construed as superseding (or preventing the application of) section 1916(g).“(2) Definitions.—In this section:“(A) Premium.—The term ‘premium’ includes any enrollment fee or similar charge.“(B) Cost sharing.—The term ‘cost sharing’ includes any deduction, copayment, or similar charge.“(b) Limitations on Exercise of Authority.—“(1) Individuals with family income between 100 and 150 percent of the poverty line.—In the case of an individual whose family income exceeds 100 percent, but does not exceed 150 percent, of the poverty line applicable to a family of the size involved, subject to subsections (c)(2) and (e)(2)(A)—“(A) no premium may be imposed under the plan; and“(B) with respect to cost sharing—“(i) the cost sharing imposed under subsection (a) with respect to any item or service may not exceed 10 percent of the cost of such item or service; and“(ii) the total aggregate amount of cost sharing imposed under this section (including any cost sharing imposed under subsection (c) or (e)) for all individuals in the family may not exceed 5 percent of the family income of the family involved, as applied on a quarterly or monthly basis (as specified by the State).“(2) Individuals with family income above 150 percent of the poverty line.—In the case of an individual whose family income exceeds 150 percent of the poverty line applicable to a family of the size involved, subject to subsections (c)(2) and (e)(2)(A)—“(A) the total aggregate amount of premiums and cost sharing imposed under this section (including any cost sharing imposed under subsection (c) or (e)) for all individuals in the family may not exceed 5 percent of the family income of the family involved, as applied on a quarterly or monthly basis (as specified by the State); and“(B) with respect to cost sharing, the cost sharing imposed with respect to any item or service under subsection (a) may not exceed 20 percent of the cost of such item or service.“(3) Additional limitations.—“(A) Premiums.—No premiums shall be imposed under this section with respect to the following:“(i) Individuals under 18 years of age that are required to be provided medical assistance under section 1902(a)(10)(A)(i), and including individuals with respect to whom aid or assistance is made available under part B of title IV to children in foster care and individuals with respect to whom adoption or foster care assistance is made available under part E of such title, without regard to age.120 STAT. 83“(ii) Pregnant women.“(iii) Any terminally ill individual who is receiving hospice care (as defined in section 1905(o)).“(iv) Any individual who is an inpatient in a hospital, nursing facility, intermediate care facility for the mentally retarded, or other medical institution, if such individual is required, as a condition of receiving services in such institution under the State plan, to spend for costs of medical care all but a minimal amount of the individual’s income required for personal needs.“(v) Women who are receiving medical assistance by virtue of the application of sections 1902(a)(10)(A)(ii)(XVIII) and 1902(aa).“(B) Cost sharing.—Subject to the succeeding provisions of this section, no cost sharing shall be imposed under subsection (a) with respect to the following:“(i) Services furnished to individuals under 18 years of age that are required to be provided medical assistance under section 1902(a)(10)(A)(i), and including services furnished to individuals with respect to whom aid or assistance is made available under part B of title IV to children in foster care and individuals with respect to whom adoption or foster care assistance is made available under part E of such title, without regard to age.“(ii) Preventive services (such as well baby and well child care and immunizations) provided to children under 18 years of age regardless of family income.“(iii) Services furnished to pregnant women, if such services relate to the pregnancy or to any other medical condition which may complicate the pregnancy.“(iv) Services furnished to a terminally ill individual who is receiving hospice care (as defined in section 1905(o)).“(v) Services furnished to any individual who is an inpatient in a hospital, nursing facility, intermediate care facility for the mentally retarded, or other medical institution, if such individual is required, as a condition of receiving services in such institution under the State plan, to spend for costs of medical care all but a minimal amount of the individual’s income required for personal needs.“(vi) Emergency services (as defined by the Secretary for purposes of section 1916(a)(2)(D)).“(vii) Family planning services and supplies described in section 1905(a)(4)(C).“(viii) Services furnished to women who are receiving medical assistance by virtue of the application of sections 1902(a)(10)(A)(ii)(XVIII) and 1902(aa).“(C) Construction.—Nothing in this paragraph shall be construed as preventing a State from exempting additional classes of individuals from premiums under this section or from exempting additional individuals or services from cost sharing under subsection (a).“(4) Determinations of family income.—In applying this subsection, family income shall be determined in a manner 120 STAT. 84 specified by the State for purposes of this subsection, including the use of such disregards as the State may provide. Family income shall be determined for such period and at such periodicity as the State may provide under this title.“(5) Poverty line defined.—For purposes of this section, the term ‘poverty line’ has the meaning given such term in section 673(2) of the Community Services Block Grant Act (42 U.S.C. 9902(2)), including any revision required by such section.“(6) Construction.—Nothing in this section shall be construed—“(A) as preventing a State from further limiting the premiums and cost sharing imposed under this section beyond the limitations provided under this section;“(B) as affecting the authority of the Secretary through waiver to modify limitations on premiums and cost sharing under this section; or“(C) as affecting any such waiver of requirements in effect under this title before the date of the enactment of this section with regard to the imposition of premiums and cost sharing.“(d) Enforceability of Premiums and Other Cost Sharing.—“(1) Premiums.—Notwithstanding section 1916(c)(3) and section 1902(a)(10)(B), a State may, at its option, condition the provision of medical assistance for an individual upon prepayment of a premium authorized to be imposed under this section, or may terminate eligibility for such medical assistance on the basis of failure to pay such a premium but shall not terminate eligibility of an individual for medical assistance under this title on the basis of failure to pay any such premium until such failure continues for a period of not less than 60 days. A State may apply the previous sentence for some or all groups of beneficiaries as specified by the State and may waive payment of any such premium in any case where the State determines that requiring such payment would create an undue hardship.“(2) Cost sharing.—Notwithstanding section 1916(e) or any other provision of law, a State may permit a provider participating under the State plan to require, as a condition for the provision of care, items, or services to an individual entitled to medical assistance under this title for such care, items, or services, the payment of any cost sharing authorized to be imposed under this section with respect to such care, items, or services. Nothing in this paragraph shall be construed as preventing a provider from reducing or waiving the application of such cost sharing on a case-by-case basis.” .(b) Indexing Nominal Cost Sharing and Conforming Amendment.—Section 1916 of such Act (42 U.S.C. 1396o) is amended—(1) in subsection (f), by inserting “and section 1916A” after “(b)(3)”; and(2) by adding at the end the following new subsection:“(h) In applying this section and subsections (c) and (e) of section 1916A, with respect to cost sharing that is ‘nominal’ in amount, the Secretary shall increase such ‘nominal’ amounts for each year (beginning with 2006) by the annual percentage increase 120 STAT. 85 in the medical care component of the consumer price index for all urban consumers (U.S. city average) as rounded up in an appropriate manner.”.(c) Effective Date.—The amendments made by this section shall apply to cost sharing imposed for items and services furnished on or after March 31, 2006.