
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 42USC1396o]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                       CHAPTER 7--SOCIAL SECURITY
 
    SUBCHAPTER XIX--GRANTS TO STATES FOR MEDICAL ASSISTANCE PROGRAMS
 
Sec. 1396o. Use of enrollment fees, premiums, deductions, cost 
        sharing, and similar charges
        

(a) Imposition of certain charges under plan in case of individuals 
        described in section 1396a(a)(10)(A) or (E)

    Subject to subsection (g) of this section, the State plan shall 
provide that in the case of individuals described in subparagraph (A) or 
(E)(i) of section 1396a(a)(10) of this title who are eligible under the 
plan--
        (1) no enrollment fee, premium, or similar charge will be 
    imposed under the plan (except for a premium imposed under 
    subsection (c) of this section);
        (2) no deduction, cost sharing or similar charge will be imposed 
    under the plan with respect to--
            (A) services furnished to individuals under 18 years of age 
        (and, at the option of the State, individuals under 21, 20, or 
        19 years of age, or any reasonable category of individuals 18 
        years of age or over),
            (B) services furnished to pregnant women, if such services 
        relate to the pregnancy or to any other medical condition which 
        may complicate the pregnancy (or, at the option of the State, 
        any services furnished to pregnant women),
            (C) 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 his income required for 
        personal needs,
            (D) emergency services (as defined by the Secretary), family 
        planning services and supplies described in section 
        1396d(a)(4)(C) of this title, or
            (E) services furnished to an individual who is receiving 
        hospice care (as defined in section 1396d(o) of this title); and

        (3) any deduction, cost sharing, or similar charge imposed under 
    the plan with respect to other such individuals or other care and 
    services will be nominal in amount (as determined by the Secretary 
    in regulations which shall, if the definition of ``nominal'' under 
    the regulations in effect on July 1, 1982 is changed, take into 
    account the level of cash assistance provided in such State and such 
    other criteria as the Secretary determines to be appropriate); 
    except that a deduction, cost-sharing, or similar charge of up to 
    twice the nominal amount established for outpatient services may be 
    imposed by a State under a waiver granted by the Secretary for 
    services received at a hospital emergency room if the services are 
    not emergency services (referred to in paragraph (2)(D)) and the 
    State has established to the satisfaction of the Secretary that 
    individuals eligible for services under the plan have actually 
    available and accessible to them alternative sources of 
    nonemergency, outpatient services.

(b) Imposition of certain charges under plan in case of individuals 
        other than those described in section 1396a(a)(10)(A) or (E)

    The State plan shall provide that in the case of individuals other 
than those described in subparagraph (A) or (E) of section 1396a(a)(10) 
of this title who are eligible under the plan--
        (1) there may be imposed an enrollment fee, premium, or similar 
    charge, which (as determined in accordance with standards prescribed 
    by the Secretary) is related to the individual's income,
        (2) no deduction, cost sharing, or similar charge will be 
    imposed under the plan with respect to--
            (A) services furnished to individuals under 18 years of age 
        (and, at the option of the State, individuals under 21, 20, or 
        19 years of age, or any reasonable category of individuals 18 
        years of age or over),
            (B) services furnished to pregnant women, if such services 
        relate to the pregnancy or to any other medical condition which 
        may complicate the pregnancy (or, at the option of the State, 
        any services furnished to pregnant women),
            (C) 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 his income required for 
        personal needs,
            (D) emergency services (as defined by the Secretary), family 
        planning services and supplies described in section 
        1396d(a)(4)(C) of this title, or
            (E) services furnished to an individual who is receiving 
        hospice care (as defined in section 1396d(o) of this title); and

        (3) any deduction, cost sharing, or similar charge imposed under 
    the plan with respect to other such individuals or other care and 
    services will be nominal in amount (as determined by the Secretary 
    in regulations which shall, if the definition of ``nominal'' under 
    the regulations in effect on July 1, 1982 is changed, take into 
    account the level of cash assistance provided in such State and such 
    other criteria as the Secretary determines to be appropriate); 
    except that a deduction, cost-sharing, or similar charge of up to 
    twice the nominal amount established for outpatient services may be 
    imposed by a State under a waiver granted by the Secretary for 
    services received at a hospital emergency room if the services are 
    not emergency services (referred to in paragraph (2)(D)) and the 
    State has established to the satisfaction of the Secretary that 
    individuals eligible for services under the plan have actually 
    available and accessible to them alternative sources of 
    nonemergency, outpatient services.

(c) Imposition of monthly premium; persons affected; amount; prepayment; 
        failure to pay; use of funds from other programs

    (1) The State plan of a State may at the option of the State provide 
for imposing a monthly premium (in an amount that does not exceed the 
limit established under paragraph (2)) with respect to an individual 
described in subparagraph (A) or (B) of section 1396a(l)(1) of this 
title who is receiving medical assistance on the basis of section 
1396a(a)(10)(A)(ii)(IX) of this title and whose family income (as 
determined in accordance with the methodology specified in section 
1396a(l)(3) of this title) equals or exceeds 150 percent of the income 
official poverty line (as defined by the Office of Management and 
Budget, and revised annually in accordance with section 9902(2) of this 
title) applicable to a family of the size involved.
    (2) In no case may the amount of any premium imposed under paragraph 
(1) exceed 10 percent of the amount by which the family income (less 
expenses for the care of a dependent child) of an individual exceeds 150 
percent of the line described in paragraph (1).
    (3) A State shall not require prepayment of a premium imposed 
pursuant to paragraph (1) and shall not terminate eligibility of an 
individual for medical assistance under this subchapter on the basis of 
failure to pay any such premium until such failure continues for a 
period of not less than 60 days. The State may waive payment of any such 
premium in any case where the State determines that requiring such 
payment would create an undue hardship.
    (4) A State may permit State or local funds available under other 
programs to be used for payment of a premium imposed under paragraph 
(1). Payment of a premium with such funds shall not be counted as income 
to the individual with respect to whom such payment is made.

(d) Premiums for qualified disabled and working individuals described in 
        section 1396d(s)

    With respect to a qualified disabled and working individual 
described in section 1396d(s) of this title whose income (as determined 
under paragraph (3) of that section) exceeds 150 percent of the official 
poverty line referred to in that paragraph, the State plan of a State 
may provide for the charging of a premium (expressed as a percentage of 
the medicare cost-sharing described in section 1396d(p)(3)(A)(i) of this 
title provided with respect to the individual) according to a sliding 
scale under which such percentage increases from 0 percent to 100 
percent, in reasonable increments (as determined by the Secretary), as 
the individual's income increases from 150 percent of such poverty line 
to 200 percent of such poverty line.

(e) Prohibition of denial of services on basis of individual's inability 
        to pay certain charges

    The State plan shall require that no provider participating under 
the State plan may deny care or services to an individual eligible for 
such care or services under the plan on account of such individual's 
inability to pay a deduction, cost sharing, or similar charge. The 
requirements of this subsection shall not extinguish the liability of 
the individual to whom the care or services were furnished for payment 
of the deduction, cost sharing, or similar charge.

(f) Charges imposed under waiver authority of Secretary

    No deduction, cost sharing, or similar charge may be imposed under 
any waiver authority of the Secretary, except as provided in subsections 
(a)(3) and (b)(3) of this section, unless such waiver is for a 
demonstration project which the Secretary finds after public notice and 
opportunity for comment--
        (1) will test a unique and previously untested use of 
    copayments,
        (2) is limited to a period of not more than two years,
        (3) will provide benefits to recipients of medical assistance 
    which can reasonably be expected to be equivalent to the risks to 
    the recipients,
        (4) is based on a reasonable hypothesis which the demonstration 
    is designed to test in a methodologically sound manner, including 
    the use of control groups of similar recipients of medical 
    assistance in the area, and
        (5) is voluntary, or makes provision for assumption of liability 
    for preventable damage to the health of recipients of medical 
    assistance resulting from involuntary participation.

(g) Individuals provided medical assistance under section 
        1396a(a)(10)(A)(ii)(XV) or (XVI)

    With respect to individuals provided medical assistance only under 
subclause (XV) or (XVI) of section 1396a(a)(10)(A)(ii) of this title--
        (1) a State may (in a uniform manner for individuals described 
    in either such subclause)--
            (A) require such individuals to pay premiums or other cost-
        sharing charges set on a sliding scale based on income that the 
        State may determine; and
            (B) require payment of 100 percent of such premiums for such 
        year in the case of such an individual who has income for a year 
        that exceeds 250 percent of the income official poverty line 
        (referred to in subsection (c)(1) of this section) applicable to 
        a family of the size involved, except that in the case of such 
        an individual who has income for a year that does not exceed 450 
        percent of such poverty line, such requirement may only apply to 
        the extent such premiums do not exceed 7.5 percent of such 
        income; and

        (2) such State shall require payment of 100 percent of such 
    premiums for a year by such an individual whose adjusted gross 
    income (as defined in section 62 of the Internal Revenue Code of 
    1986) for such year exceeds $75,000, except that a State may choose 
    to subsidize such premiums by using State funds which may not be 
    federally matched under this subchapter.

In the case of any calendar year beginning after 2000, the dollar amount 
specified in paragraph (2) shall be increased in accordance with the 
provisions of section 415(i)(2)(A)(ii) of this title.

(Aug. 14, 1935, ch. 531, title XIX, Sec. 1916, as added Pub. L. 97-248, 
title I, Sec. 131(b), Sept. 3, 1982, 96 Stat. 367; amended Pub. L. 97-
448, title III, Sec. 309(b)(18)-(20), Jan. 12, 1983, 96 Stat. 2409, 
2410; Pub. L. 99-272, title IX, Sec. 9505(c)(2), Apr. 7, 1986, 100 Stat. 
209; Pub. L. 99-509, title IX, Sec. 9403(g)(4)(B), Oct. 21, 1986, 100 
Stat. 2056; Pub. L. 100-203, title IV, Secs. 4101(d)(1), 4211(h)(11), 
Dec. 22, 1987, 101 Stat. 1330-142, 1330-207; Pub. L. 100-360, title IV, 
Sec. 411(k)(2), July 1, 1988, 102 Stat. 791; Pub. L. 101-239, title VI, 
Sec. 6408(d)(3), Dec. 19, 1989, 103 Stat. 2269; Pub. L. 105-33, title 
IV, Sec. 4708(b), Aug. 5, 1997, 111 Stat. 506; Pub. L. 106-170, title 
II, Sec. 201(a)(3), Dec. 17, 1999, 113 Stat. 1893.)

                       References in Text

    The Internal Revenue Code of 1986, referred to in subsec. (g)(2), is 
classified generally to Title 26, Internal Revenue Code.


                               Amendments

    1999--Subsec. (a). Pub. L. 106-170, Sec. 201(a)(3)(A), substituted 
``Subject to subsection (g) of this section, the State plan'' for ``The 
State plan'' in introductory provisions.
    Subsec. (g). Pub. L. 106-170, Sec. 201(a)(3)(B), added subsec. (g).
    1997--Subsec. (a)(2)(D). Pub. L. 105-33, Sec. 4708(b)(1), struck out 
``or services furnished to such an individual by a health maintenance 
organization (as defined in section 1396b(m) of this title) in which he 
is enrolled,'' after ``section 1396d(a)(4)(C) of this title,''.
    Subsec. (b)(2)(D). Pub. L. 105-33, Sec. 4708(b)(2), struck out ``or 
(at the option of the State) services furnished to such an individual by 
a health maintenance organization (as defined in section 1396b(m) of 
this title) in which he is enrolled,'' after ``section 1396d(a)(4)(C) of 
this title,''.
    1989--Subsec. (a). Pub. L. 101-239, Sec. 6408(d)(3)(A), substituted 
``subparagraph (A) or (E)(i)'' for ``subparagraph (A) or (E)'' in 
introductory provisions.
    Subsecs. (d) to (f). Pub. L. 101-239, Sec. 6408(d)(3)(B), (C), added 
subsec. (d) and redesignated former subsecs. (d) and (e) as (e) and (f), 
respectively.
    1988--Subsec. (c)(1). Pub. L. 100-360 struck out ``nonfarm'' after 
``150 percent of the''.
    1987--Subsec. (a)(1). Pub. L. 100-203, Sec. 4101(d)(1)(A), inserted 
``(except for a premium imposed under subsection (c) of this section)'' 
after ``plan''.
    Subsecs. (a)(2)(C), (b)(2)(C). Pub. L. 100-203, Sec. 4211(h)(11), 
substituted ``nursing facility, intermediate care facility for the 
mentally retarded'' for ``skilled nursing facility, intermediate care 
facility''.
    Subsecs. (c) to (e). Pub. L. 100-203, Sec. 4101(d)(1)(B), (C), added 
subsec. (c) and redesignated former subsecs. (c) and (d) as (d) and (e), 
respectively.
    1986--Subsec. (a). Pub. L. 99-509 substituted ``subparagraph (A) or 
(E) of section 1396a(a)(10) of this title'' for ``section 
1396a(a)(10)(A) of this title''.
    Subsec. (a)(2)(E). Pub. L. 99-272 added subpar. (E).
    Subsec. (b). Pub. L. 99-509 substituted ``subparagraph (A) or (E) of 
section 1396a(a)(10) of this title'' for ``section 1396a(a)(10)(A) of 
this title''.
    Subsec. (b)(2)(E). Pub. L. 99-272 added subpar. (E).
    1983--Subsec. (c). Pub. L. 97-448, Sec. 309(b)(18), substituted 
``subsection'' for ``subparagraph''.
    Subsec. (d). Pub. L. 97-448, Sec. 309(b)(19), (20), substituted in 
introductory text ``, except as provided in subsections (a)(3) and 
(b)(3) of this section'' for ``unless authorized under this section'', 
and in cl. (5) substituted ``is voluntary, or makes provision'' for ``in 
which participation is voluntary, or in which provision is made''.


                    Effective Date of 1999 Amendment

    Amendment by Pub. L. 106-170 applicable to medical assistance for 
items and services furnished on or after Oct. 1, 2000, see section 
201(d) of Pub. L. 106-170, set out as a note under section 1396a of this 
title.


                    Effective Date of 1997 Amendment

    Amendment by Pub. L. 105-33 effective Aug. 5, 1997, and applicable 
to contracts entered into or renewed on or after Oct. 1, 1997, see 
section 4710 of Pub. L. 105-33, set out as a note under section 1396b of 
this title.


                    Effective Date of 1989 Amendment

    Amendment by Pub. L. 101-239 applicable, except as otherwise 
provided, to payments under this subchapter for calendar quarters 
beginning on or after July 1, 1990, without regard to whether or not 
final regulations have been promulgated by such date, see section 
6408(d)(5) of Pub. L. 101-239, set out as a note under section 1396a of 
this title.


                    Effective Date of 1988 Amendment

    Except as specifically provided in section 411 of Pub. L. 100-360, 
amendment by Pub. L. 100-360, as it relates to a provision in the 
Omnibus Budget Reconciliation Act of 1987, Pub. L. 100-203, effective as 
if included in the enactment of that provision in Pub. L. 100-203, see 
section 411(a) of Pub. L. 100-360, set out as a Reference to OBRA; 
Effective Date note under section 106 of Title 1, General Provisions.


                    Effective Date of 1987 Amendment

    Section 4101(d)(2) of Pub. L. 100-203 provided that: ``The 
amendments made by paragraph (1) [amending this section] shall become 
effective on July 1, 1988.''
    Amendment by section 4211(h)(11) of Pub. L. 100-203 applicable to 
nursing facility services furnished on or after Oct. 1, 1990, without 
regard to whether regulations implementing such amendment are 
promulgated by such date, except as otherwise specifically provided in 
section 1396r of this title, with transitional rule, see section 
4214(a), (b)(2) of Pub. L. 100-203, as amended, set out as an Effective 
Date note under section 1396r of this title.


                    Effective Date of 1986 Amendments

    Amendment by Pub. L. 99-509 applicable to payments under this 
subchapter for calendar quarters beginning on or after July 1, 1987, 
without regard to whether or not final regulations to carry out such 
amendments have been promulgated by such date, see section 9403(h) of 
Pub. L. 99-509, set out as a note under section 1396a of this title.
    Amendment by Pub. L. 99-272 applicable to medical assistance 
provided for hospice care furnished on or after Apr. 7, 1986, see 
section 9505(e) of Pub. L. 99-272, set out as a note under section 1396a 
of this title.


                    Effective Date of 1983 Amendment

    Amendment by Pub. L. 97-448 effective as if originally included as a 
part of this section as this section was added by the Tax Equity and 
Fiscal Responsibility Act of 1982, Pub. L. 97-248, see section 309(c)(2) 
of Pub. L. 97-448, set out as a note under section 426-1 of this title.


                             Effective Date

    Section 131(d), formerly Sec. 131(c), of Pub. L. 97-248, 
redesignated by section 309(a)(8) of Pub. L. 97-448, provided that:
    ``(1) Except as provided in paragraph (2), the amendments made by 
this section [enacting this section and amending section 1396a of this 
title] shall become effective on October 1, 1982.
    ``(2) In the case of a State plan for medical assistance under title 
XIX of the Social Security Act [this subchapter] which the Secretary of 
Health and Human Services determines requires State legislation in order 
for the plan to meet the additional requirements imposed by the 
amendments made by this section, the State plan shall not be regarded as 
failing to comply with the requirements of such title solely on the 
basis of its failure to meet these additional requirements 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 [Sept. 3, 1982].''

                  Section Referred to in Other Sections

    This section is referred to in sections 1396a, 1396b, 1396e, 1396r, 
1396r-6, 1397cc of this title; title 8 section 1255a.
