article: SECTION 1. SHORT TITLE. This Act may be cited as the ``SCHIP Enhancement Act of 2001''. SEC. 2. FINDINGS. Congress makes the following findings: (1) The State children's health insurance program (SCHIP) established under title XXI of the Social Security Act (42 U.S.C. 1397aa et seq.) currently limits coverage of children under that program to children whose family income does not exceed 200 percent of the Federal poverty line or 50 percentage points above the State's medicaid applicable income level. (2) Three million uninsured children (over 1 of every 4 such children) have family incomes that exceed 200 percent of the Federal poverty line, and 1,400,000 of those uninsured children would be provided health insurance coverage if the income eligibility level for SCHIP were increased to 300 percent of the Federal poverty line. SEC. 3. STATE OPTION TO EXPAND INCOME ELIGIBILITY UNDER SCHIP. (a) Definition of Low-Income Child.--Section 2110(c)(4) of the Social Security Act (42 U.S.C. 42 U.S.C. 1397jj(c)(4)) is amended-- (1) by striking ``The term'' and inserting the following: ``(A) In general.--The term''; and (2) by adding at the end the following new subparagraph: ``(B) State option to expand eligibility.-- ``(i) In general.--A State may elect through a plan amendment to apply subparagraph (A) as if `300 percent' were substituted for `200 percent'. ``(ii) No effect on determination of section 2104 allotments.--An election under clause (i) shall have no effect on the determination of a State's allotment under subsection (b) or (c) of section 2104.''. (b) Effective Date.--The amendments made by subsection (a) apply to child health assistance provided on or after October 1, 2001. SEC. 4. ADDITIONAL ALLOTMENTS FOR STATES THAT EXPAND INCOME ELIGIBILITY UNDER SCHIP. (a) In General.--Title XXI of the Social Security Act (42 U.S.C. 1397aa et seq.) is amended by adding at the end the following new section: ``SEC. 2111. ADDITIONAL ALLOTMENTS FOR STATES THAT OPT TO EXPAND INCOME ELIGIBILITY. ``(a) Eligibility for Additional Allotments.--A State that, not later than December 31 of any fiscal year, meets the following requirements shall be eligible for the additional allotments determined for the State under subsection (b) for that fiscal year: ``(1) Increase in income eligibility.--The State submits to the Secretary a certification by the chief executive officer of the State that, during the fiscal year, the State child health plan (whether implemented under title XIX or under this title) will have an income standard for children that is at least-- ``(A) with respect to the additional allotment determined under subsection (b)(1), 250 percent of the poverty line; and ``(B) with respect to the additional allotment determined under subsection (b)(2), 300 percent of the poverty line. ``(2) Submission of information required for certain uses of the additional allotment.--In the case of a State that intends to use the additional allotment provided under subsection (b)(2) for the purpose described in subsection (c)(3), the State submits to the Secretary a description of the reasonable planning and implementation costs the State expects to incur in providing premium assistance for family coverage under an employer-sponsored group health plan in accordance with subsection (d). ``(b) Determination of Additional Allotments.-- ``(1) States that increase income standard to 250 percent.--With respect to $617,000,000 of the amount available for the additional allotments under subsection (e) for a fiscal year, the Secretary shall allot an amount to each State with a State child health plan approved under this title that satisfies the requirements of paragraph (1)(A) and, if applicable, paragraph (2) of subsection (a)-- ``(A) in the case of such a State other than a commonwealth or territory described in subparagraph (B), an amount determined to bear the same ratio to $617,000,000 as the State's allotment under section 2104(b) (determined without regard to section 2104(f)) bears to 98.95 percent of the total amount of the allotments determined under section 2104(b) for such States for such fiscal year; and ``(B) in the case of a commonwealth or territory described in section 2104(c)(3), determined to bear the same ratio to $617,000,000 as the commonwealth's or territory's allotment under section 2104(c) (determined without regard to section 2104(f)) bears to 1.05 percent of the total amount of the allotments determined under section 2104(c) for commonwealths and territories for such fiscal year. ``(2) States that increase income standard to 300 percent.-- ``(A) In general.--With respect to $383,000,000 of the amount available for the additional allotments under subsection (e) for a fiscal year, the Secretary shall allot an amount to each State with a State child health plan approved under this title that satisfies the requirements of paragraph (1)(B) and, if applicable, paragraph (2) of subsection (a) determined in the same manner as the additional allotments under paragraph (1). ``(B) Allotments in addition to 250 percent allotments.--The allotments provided under this paragraph to a State shall be in addition to the allotments provided to the State under paragraph (1). ``(3) Availability.-- ``(A) 3-year availability.--Except as provided in subparagraph (B), amounts allotted to a State under paragraph (1) and, if applicable, paragraph (2) for a fiscal year shall remain available for expenditure by the State through the end of the second succeeding fiscal year. ``(B) Return of unused allotments.--The allotments set-aside under paragraphs (1) and (2) for a fiscal year for any State that has not met the requirements of subsection (a) on January 1 of that fiscal year shall be returned to the Treasury. ``(c) Use of Additional Allotments.--The additional allotments provided under subsection (b) to a State for a fiscal year may be-- ``(1) combined with the State's allotment for the fiscal year determined under section 2104 and used to provide child health assistance to all targeted low-income children under the State child health plan; or ``(2) used for-- ``(A) a premium assistance program under which the State pays part of the premiums for coverage of a child who is eligible for child health assistance under group health insurance or a group health plan in accordance with subsection (d); and ``(B) reasonable planning and implementation costs specified by the State under subsection (a)(2) without regard to the limitation on such costs under section 2105(c)(2)(A). ``(d) Premium Assistance for Family Coverage Under an Employer- Sponsored Group Health Plan.--The additional allotments provided under subsection (b) to a State for a fiscal year may be used for a premium assistance program that meets the following requirements: ``(1) The premium assistance program is cost-effective. ``(2) The State provides assurances that a child provided such assistance will receive the minimum benefits and cost- sharing protections established under this title either through the employer-sponsored group health plan or as a supplement to such coverage. ``(3) Employees eligible for employer-sponsored health coverage apply for the full premium contribution available from the employer. ``(4) The State evaluates the amount of substitution that occurs as a result of the premium assistance program and the effect of the program on access to health coverage. ``(e) Appropriation.--For the purpose of providing additional allotments under this section to States that meet the requirements of subsection (a), there is appropriated, out of any money in the Treasury not otherwise appropriated, for each of fiscal years 2002 through 2011, $1,000,000,000.''. SEC. 5. EVALUATION AND REPORT ON PREMIUM ASSISTANCE FOR FAMILY COVERAGE. (a) In General.--The Secretary of Health and Human Services shall conduct an evaluation of any premium assistance programs conducted with the allotments provided to States under section 2111(b) of the Social Security Act (as added by section 4). Such evaluation shall identify any implementation problems with the provision of such assistance and whether the assistance has supplanted health insurance coverage that otherwise would be provided to such children. (b) Report.--Not later than January 1, 2006, the Secretary of Health and Human Services shall submit to Congress a report on the evaluation conducted under subsection (a), together with any recommendations for legislation that the Secretary determines to be appropriate as a result of such evaluation.
summary: SCHIP Enhancement Act of 2001 - Amends title XXI (State Children's Health Insurance Program) (SCHIP) of the Social Security Act (SSA) to give States the option to expand income eligibility under SCHIP to children whose family income totals up to 300 percent (currently only 200 percent) of the Federal poverty line. Provides for additional allotments for States that expand income eligibility under SCHIP, allowing such allotments to be used for premium assistance for family coverage under an employee-sponsored group health plan.