
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 23, 2000]
[Document affected by Public Law 106-554 Section 1(a)(6)]
[Document affected by Public Law 106-554 Section 1(a)(6)[802(a)]]
[Document affected by Public Law 106-554 Section 1(a)(6)[802(e)]]
[CITE: 42USC1397ee]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                       CHAPTER 7--SOCIAL SECURITY
 
        SUBCHAPTER XXI--STATE CHILDREN'S HEALTH INSURANCE PROGRAM
 
Sec. 1397ee. Payments to States


(a) In general

    Subject to the succeeding provisions of this section, the Secretary 
shall pay to each State with a plan approved under this subchapter, from 
its allotment under section 1397dd of this title (taking into account 
any adjustment under section 1397dd(d) of this title), an amount for 
each quarter equal to the enhanced FMAP of expenditures in the quarter--
        (1) for child health assistance under the plan for targeted low-
    income children in the form of providing health benefits coverage 
    that meets the requirements of section 1397cc of this title; and
        (2) only to the extent permitted consistent with subsection (c) 
    of this section--
            (A) for payment for other child health assistance for 
        targeted low-income children;
            (B) for expenditures for health services initiatives under 
        the plan for improving the health of children (including 
        targeted low-income children and other low-income children);
            (C) for expenditures for outreach activities as provided in 
        section 1397bb(c)(1) of this title under the plan; and
            (D) for other reasonable costs incurred by the State to 
        administer the plan.

(b) Enhanced FMAP

    For purposes of subsection (a) of this section, the ``enhanced 
FMAP'', for a State for a fiscal year, is equal to the Federal medical 
assistance percentage (as defined in the first sentence of section 
1396d(b) of this title) for the State increased by a number of 
percentage points equal to 30 percent of the number of percentage points 
by which (1) such Federal medical assistance percentage for the State, 
is less than (2) 100 percent; but in no case shall the enhanced FMAP for 
a State exceed 85 percent.

(c) Limitation on certain payments for certain expenditures

                       (1) General limitations

        Funds provided to a State under this subchapter shall only be 
    used to carry out the purposes of this subchapter (as described in 
    section 1397aa of this title), and any health insurance coverage 
    provided with such funds may include coverage of abortion only if 
    necessary to save the life of the mother or if the pregnancy is the 
    result of an act of rape or incest.

      (2) Limitation on expenditures not used for medicaid or 
                         health insurance assistance

        (A) In general

            Except as provided in this paragraph, payment shall not be 
        made under subsection (a) of this section for expenditures for 
        items described in subsection (a) of this section (other than 
        paragraph (1)) for a fiscal year to the extent the total of such 
        expenditures (for which payment is made under such subsection) 
        exceeds 10 percent of the sum of--
                (i) the total of such expenditures for such fiscal year, 
            and
                (ii) the total expenditures for medical assistance by 
            the State under subchapter XIX of this chapter for which 
            Federal payments made under section 1396b(a)(1) of this 
            title are based on an enhanced FMAP described in subsection 
            (b) of this section for such fiscal year.

        (B) Waiver authorized for cost-effective alternative

            The limitation under subparagraph (A) on expenditures for 
        items described in subsection (a)(2) of this section shall not 
        apply to the extent that a State establishes to the satisfaction 
        of the Secretary that--
                (i) coverage provided to targeted low-income children 
            through such expenditures meets the requirements of section 
            1397cc of this title;
                (ii) the cost of such coverage is not greater, on an 
            average per child basis, than the cost of coverage that 
            would otherwise be provided under section 1397cc of this 
            title; and
                (iii) such coverage is provided through the use of a 
            community-based health delivery system, such as through 
            contracts with health centers receiving funds under section 
            254b of this title or with hospitals such as those that 
            receive disproportionate share payment adjustments under 
            section 1395ww(d)(5)(F) or 1396r-4 of this title.

             (3) Waiver for purchase of family coverage

        Payment may be made to a State under subsection (a)(1) of this 
    section for the purchase of family coverage under a group health 
    plan or health insurance coverage that includes coverage of targeted 
    low-income children only if the State establishes to the 
    satisfaction of the Secretary that--
            (A) purchase of such coverage is cost-effective relative to 
        the amounts that the State would have paid to obtain comparable 
        coverage only of the targeted low-income children involved, and
            (B) such coverage shall not be provided if it would 
        otherwise substitute for health insurance coverage that would be 
        provided to such children but for the purchase of family 
        coverage.

     (4) Use of non-Federal funds for State matching requirement

        Amounts provided by the Federal Government, or services assisted 
    or subsidized to any significant extent by the Federal Government, 
    may not be included in determining the amount of non-Federal 
    contributions required under subsection (a) of this section.

     (5) Offset of receipts attributable to premiums and other 
                                cost-sharing

        For purposes of subsection (a) of this section, the amount of 
    the expenditures under the plan shall be reduced by the amount of 
    any premiums and other cost-sharing received by the State.

               (6) Prevention of duplicative payments

        (A) Other health plans

            No payment shall be made to a State under this section for 
        expenditures for child health assistance provided for a targeted 
        low-income child under its plan to the extent that a private 
        insurer (as defined by the Secretary by regulation and including 
        a group health plan (as defined in section 1167(1) of title 29), 
        a service benefit plan, and a health maintenance organization) 
        would have been obligated to provide such assistance but for a 
        provision of its insurance contract which has the effect of 
        limiting or excluding such obligation because the individual is 
        eligible for or is provided child health assistance under the 
        plan.

        (B) Other Federal governmental programs

            Except as otherwise provided by law, no payment shall be 
        made to a State under this section for expenditures for child 
        health assistance provided for a targeted low-income child under 
        its plan to the extent that payment has been made or can 
        reasonably be expected to be made promptly (as determined in 
        accordance with regulations) under any other federally operated 
        or financed health care insurance program, other than an 
        insurance program operated or financed by the Indian Health 
        Service, as identified by the Secretary. For purposes of this 
        paragraph, rules similar to the rules for overpayments under 
        section 1396b(d)(2) of this title shall apply.

               (7) Limitation on payment for abortions

        (A) In general

            Payment shall not be made to a State under this section for 
        any amount expended under the State plan to pay for any abortion 
        or to assist in the purchase, in whole or in part, of health 
        benefit coverage that includes coverage of abortion.

        (B) Exception

            Subparagraph (A) shall not apply to an abortion only if 
        necessary to save the life of the mother or if the pregnancy is 
        the result of an act of rape or incest.

        (C) Rule of construction

            Nothing in this section shall be construed as affecting the 
        expenditure by a State, locality, or private person or entity of 
        State, local, or private funds (other than funds expended under 
        the State plan) for any abortion or for health benefits coverage 
        that includes coverage of abortion.

(d) Maintenance of effort

                (1) In medicaid eligibility standards

        No payment may be made under subsection (a) of this section with 
    respect to child health assistance provided under a State child 
    health plan if the State adopts income and resource standards and 
    methodologies for purposes of determining a child's eligibility for 
    medical assistance under the State plan under subchapter XIX of this 
    chapter that are more restrictive than those applied as of June 1, 
    1997.

    (2) In amounts of payment expended for certain State-funded 
                   health insurance programs for children

        (A) In general

            The amount of the allotment for a State in a fiscal year 
        (beginning with fiscal year 1999) shall be reduced by the amount 
        by which--
                (i) the total of the State children's health insurance 
            expenditures in the preceding fiscal year, is less than
                (ii) the total of such expenditures in fiscal year 1996.

        (B) State children's health insurance expenditures

            The term ``State children's health insurance expenditures'' 
        means the following:
                (i) The State share of expenditures under this 
            subchapter.
                (ii) The State share of expenditures under subchapter 
            XIX of this chapter that are attributable to an enhanced 
            FMAP under section 1396d(u) of this title.
                (iii) State expenditures under health benefits coverage 
            under an existing comprehensive State-based program, 
            described in section 1397cc(d) of this title.

(e) Advance payment; retrospective adjustment

    The Secretary may make payments under this section for each quarter 
on the basis of advance estimates of expenditures submitted by the State 
and such other investigation as the Secretary may find necessary, and 
may reduce or increase the payments as necessary to adjust for any 
overpayment or underpayment for prior quarters.

(f) Flexibility in submittal of claims

    Nothing in this section or subsections (e) and (f) of section 1397dd 
of this title shall be construed as preventing a State from claiming as 
expenditures in the quarter expenditures that were incurred in a 
previous quarter.

(Aug. 14, 1935, ch. 531, title XXI, Sec. 2105, as added Pub. L. 105-33, 
title IV, Sec. 4901(a), Aug. 5, 1997, 111 Stat. 560; amended Pub. L. 
105-100, title I, Sec. 162(5), (7), Nov. 19, 1997, 111 Stat. 2189, 2190; 
Pub. L. 106-113, div. B, Sec. 1000(a)(6) [title VII, Sec. 705(b)], Nov. 
29, 1999, 113 Stat. 1536, 1501A-402.)


                               Amendments

    1999--Subsec. (d)(2)(B)(iii). Pub. L. 106-113 inserted ``in'' after 
``described''.
    1997--Subsec. (c)(2)(A). Pub. L. 105-100, Sec. 162(5), reenacted 
heading without change and amended text generally. Prior to amendment, 
text read as follows: ``Except as provided in this paragraph, payment 
shall not be made under subsection (a) of this section for expenditures 
for items described in subsection (a) of this section (other than 
paragraph (1)) for a quarter in a fiscal year to the extent the total of 
such expenditures exceeds 10 percent of the sum of--
        ``(i) the total Federal payments made under subsection (a) of 
    this section for such quarter in the fiscal year, and
        ``(ii) the total Federal payments made under section 1396b(a)(1) 
    of this title based on an enhanced FMAP described in section 
    1396d(u)(2) of this title for such quarter.''
    Subsec. (f). Pub. L. 105-100, Sec. 162(7), added subsec. (f).


                    Effective Date of 1997 Amendment

    Section 162 of Pub. L. 105-100 provided in part that the amendment 
made by that section is effective as if included in the enactment of 
subtitle J (Secs. 4901-4923) of title IV of the Balanced Budget Act of 
1997, Pub. L. 105-33.

                  Section Referred to in Other Sections

    This section is referred to in sections 1396d, 1397aa, 1397ff, 
1397ii, 1397jj of this title.
