[Pages S3508-S3512]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

By Mr. ROCKEFELLER (for himself, Mr. Corzine, Mr. Inouye, Ms.
Landrieu, Mr. Levin, Mr. Reed, and Mr. Sarbanes):
S. 588. A bill to amend the Social Security Act to guarantee
comprehensive health care coverage for all children born after 2004; to
the Committee on Finance.
Mr. ROCKEFELLER. Mr. President, I am pleased and proud to introduce
the MediKids Health Insurance Act of 2003. Congressman Stark is
introducing a companion bill in the House.
This legislation is, without a doubt, ambitious. It is a deliberate
effort to try to ignite a national commitment to the goal of insuring
all of our children. For some, that is an idealistic proposition that
does not seem achievable. With this bill, I want to call on the public
and my colleagues to consider once again the clear and convincing case
for investing the necessary resources in the health of our children--
and therefore, in the well-being of their families and our entire
country. The President and Congress continue to talk about their
commitment to America's health. This bill challenges them to take
action on their rhetoric.
Our children are not only our future, they are also our present. What
we do for them today will greatly affect what happens tomorrow. Yet
even though we recognize these facts, we still have not found a way to
guarantee health coverage for children. Without health insurance, many
of these children go without health care all together.
Children are the least expensive segment of our population to insure.
They are also the least able to have control over whether or not they
have health insurance. Yet we now have over 9 million uninsured
children in this country. And with the downturn in the economy and the
rising costs of health care, this number will continue rising.
Our success in expanding Medicaid and passing the State Children's
Health Insurance Program was a meaningful, significant start at closing
the tragic gap represented by millions of uninsured children. However,
Congress cannot point to these programs and declare that our work is
done. We still have much more to do. The percent of children in low-
income families without health insurance has not changed in recent
years. Even with perfect enrollment in S-CHIP and Medicaid, there would
still be a great number of children without health insurance.
This is partially due to our increasingly mobile society, where
parents frequently change jobs and families often move from State to
State. When this occurs there is often a lapse in health coverage.
Also, families working their way out of welfare fluctuate between
eligibility and ineligibility for means-tested assistance programs.
Another reason for the number of uninsured children is that the cost of
health insurance continues to increase, leaving many working parents
unable to afford coverage for themselves or their families. All of this
adds up to the fact that many of our children do not have the
consistent and regular access to health care which they need to grow up
healthy.
That is why I am re-introducing the MediKids Health Insurance Act.
This bill would automatically enroll every child at birth into a new,
comprehensive Federal safety net health insurance program beginning in
2004. The benefits would be tailored to the needs of children and would
be similar to those currently available to children under Medicaid. A
small monthly premium would be collected from parents at tax filing,
with discounts to low-income families phasing out at 300 percent of
poverty. The children would remain enrolled in MediKids throughout
childhood. When they are covered by another health insurance program,
their parents would be exempt from the premium. The key to our program
is that whenever other sources of health insurance fail, MediKids would
stand ready to cover the health needs of our next generation. By the
year 2020, every child in America would be able to grow up with
consistent, continuous health insurance coverage.
Like Medicare, MediKids would be independently financed, would cover
benefits tailored to the needs of its target population, and would have
the goal of achieving nearly 100 percent health insurance coverage for
the children of this country--just as Medicare has done for our
Nation's seniors and disabled population. It's time we make this
investment in the future of America by guaranteeing all children the
health coverage they need to make a healthy start in life.
The MediKids Health Insurance Act would offer guaranteed, automatic
health coverage for every child with the simplest of enrollment
procedures and no challenging outreach, paperwork, or re-determination
hoops to jump through. It would be able to follow children across state
lines, or tide them over in a new location until their parents can
enroll them in a new insurance program. Between jobs or during family
crises such as divorce or the death of a parent, it would offer extra
security and ensure continuous health coverage to the Nation's
children. During that critical period when a family is just climbing
out of poverty and out of the eligibility range for means-tested
assistance programs, it would provide an extra boost with health
insurance for the children until the parents can move into jobs that
provide reliable health insurance coverage. And every child would
automatically be enrolled upon birth, along with the issuance of the
birth certificate or immigration card.
As we all know, an ounce of prevention is worth a pound of cure.
Providing health care coverage to children affects much more than their
health--it affects their ability to learn, their ability to thrive, and
their ability to become a productive member of society. I look forward
to working with my colleagues and supporting organizations for the
passage of the MediKids Health Insurance Act of 2003 to guarantee every
child in America the health coverage they need to grow up healthy.
I stand before you today to deliver a message. That it is time to
rekindle the discussion about how we are going to provide health
insurance for all Americans. The bill I am introducing today--the
MediKids Health Insurance Act of 2003--is a step toward eliminating the
irrational and tragic lack of health insurance for so many children and
adults in our country.
Partial solutions to America's ``uninsured crisis'' lie before
Congress, and I recognize the sense of realism and care that are the
basis for proposing incremental steps towards universal coverage. As
someone involved in the tough battles in years past to achieve
universal coverage, I will continue to do all I can to make whatever
progress can be made each and every year.
But I also believe it is important to not lose sight of the ideal--
and our capacity to reach that ideal--of the United States of America
joining every other industrialized nation by ensuring that its citizens
have basic health insurance. Until we succeed, millions of children and
adults will suffer human and financial costs that are preventable.
Therefore, I offer this legislation to both enlist my colleagues in
an effort to insist that all of our Nation's children are insured as
quickly as possible and to lay out the steps that would achieve that
goal. Some may say that we cannot afford this level of commitment to
America's children in a time of war and economic downturn. I strongly
disagree. We can fully fund MediKids with the more than $388 billion
the President's budget proposes to spend on the dividend tax cut. I
believe that choice is clear between providing 100 percent of our
children with health care coverage and giving tax breaks to the
wealthiest 2 percent of people in our country. I hope this bill will
help to build the will and momentum so desperately needed by our
children for action that will change their lives and

[[Page S3509]]

strengthen our Nation. I ask my colleagues from both sides of the aisle
to join as co-sponsors.
I ask unanimous consent that the text of this bill be printed in the
Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:

S. 588

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS; FINDINGS.

(a) Short Title.--This Act may be cited as the ``MediKids
Health Insurance Act of 2003''.
(b) Table of Contents.--The table of contents of this Act
is as follows:

Sec. 1. Short title; table of contents; findings.
Sec. 2. Benefits for all children born after 2004.

``TITLE XXII--MEDIKIDS PROGRAM

``Sec. 2201. Eligibility.
``Sec. 2202. Benefits.
``Sec. 2203. Premiums.
``Sec. 2204. MediKids Trust Fund.
``Sec. 2205. Oversight and accountability.
``Sec. 2206. Addition of care coordination services.
``Sec. 2207. Administration and miscellaneous.
Sec. 3. MediKids premium.
Sec. 4. Refundable credit for cost-sharing expenses under MediKids
program.
Sec. 5. Report on long-term revenues.
(c) Findings.--Congress finds the following:
(1) More than 9 million American children are uninsured.
(2) Children who are uninsured receive less medical care
and less preventive care and have a poorer level of health,
which result in lifetime costs to themselves and to the
entire American economy.
(3) Although SCHIP and Medicaid are successfully extending
a health coverage safety net to a growing portion of the
vulnerable low-income population of uninsured children, they
alone cannot achieve 100 percent health insurance coverage
for our nation's children due to inevitable gaps during
outreach and enrollment, fluctuations in eligibility,
variations in access to private insurance at all income
levels, and variations in States' ability to provide required
matching funds.
(4) As all segments of society continue to become more
transient, with many changes in employment over the working
lifetime of parents, the need for a reliable safety net of
health insurance which follows children across State lines,
already a major problem for the children of migrant and
seasonal farmworkers, will become a major concern for all
families in the United States.
(5) The medicare program has successfully evolved over the
years to provide a stable, universal source of health
insurance for the nation's disabled and those over age 65,
and provides a tested model for designing a program to reach
out to America's children
(6) The problem of insuring 100 percent of all American
children could be gradually solved by automatically enrolling
all children born after December 31, 2004, in a program
modeled after Medicare (and to be known as ``MediKids''), and
allowing those children to be transferred into other
equivalent or better insurance programs, including either
private insurance, SCHIP, or Medicaid, if they are eligible
to do so, but maintaining the child's default enrollment in
MediKids for any times when the child's access to other
sources of insurance is lost.
(7) A family's freedom of choice to use other insurers to
cover children would not be interfered with in any way, and
children eligible for SCHIP and Medicaid would continue to be
enrolled in those programs, but the underlying safety net of
MediKids would always be available to cover any gaps in
insurance due to changes in medical condition, employment,
income, or marital status, or other changes affecting a
child's access to alternate forms of insurance.
(8) The MediKids program can be administered without
impacting the finances or status of the existing Medicare
program.
(9) The MediKids benefit package can be tailored to the
special needs of children and updated over time.
(10) The financing of the program can be administered
without difficulty by a yearly payment of affordable premiums
through a family's tax filing (or adjustment of a family's
earned income tax credit).
(11) The cost of the program will gradually rise as the
number of children using MediKids as the insurer of last
resort increases, and a future Congress always can accelerate
or slow down the enrollment process as desired, while the
societal costs for emergency room usage, lost productivity
and work days, and poor health status for the next generation
of Americans will decline.
(12) Over time 100 percent of American children will always
have basic health insurance, and we can therefore expect a
healthier, more equitable, and more productive society.

SEC. 2. BENEFITS FOR ALL CHILDREN BORN AFTER 2004.

(a) In General.--The Social Security Act is amended by
adding at the end the following new title:

``TITLE XXII--MEDIKIDS PROGRAM

``SEC. 2201. ELIGIBILITY.

``(a) Eligibility of Individuals Born After December 31,
2004; All Children Under 23 Years of Age in Sixth Year.--An
individual who meets the following requirements with respect
to a month is eligible to enroll under this title with
respect to such month:
``(1) Age.--
``(A) First year.--During the first year in which this
title is effective, the individual has not attained 6 years
of age.
``(B) Second year.--During the second year in which this
title is effective, the individual has not attained 11 years
of age.
``(C) Third year.--During the third year in which this
title is effective, the individual has not attained 16 years
of age.
``(D) Fourth year.--During the fourth year in which this
title is effective, the individual has not attained 21 years
of age.
``(E) Fifth and subsequent years.--During the fifth year in
which this title is effective and each subsequent year, the
individual has not attained 23 years of age.
``(2) Citizenship.--The individual is a citizen or national
of the United States or is permanently residing in the United
States under color of law.
``(b) Enrollment Process.--An individual may enroll in the
program established under this title only in such manner and
form as may be prescribed by regulations, and only during an
enrollment period prescribed by the Secretary consistent with
the provisions of this section. Such regulations shall
provide a process under which--
``(1) individuals who are born in the United States after
December 31, 2004, are deemed to be enrolled at the time of
birth and a parent or guardian of such an individual is
permitted to pre-enroll in the month prior to the expected
month of birth;
``(2) individuals who are born outside the United States
after such date and who become eligible to enroll by virtue
of immigration into (or an adjustment of immigration status
in) the United States are deemed enrolled at the time of
entry or adjustment of status;
``(3) eligible individuals may otherwise be enrolled at
such other times and manner as the Secretary shall specify,
including the use of outstationed eligibility sites as
described in section 1902(a)(55)(A) and the use of
presumptive eligibility provisions like those described in
section 1920A; and
``(4) at the time of automatic enrollment of a child, the
Secretary provides for issuance to a parent or custodian of
the individual a card evidencing coverage under this title
and for a description of such coverage.
The provisions of section 1837(h) apply with respect to
enrollment under this title in the same manner as they apply
to enrollment under part B of title XVIII.
``(c) Date Coverage Begins.--
``(1) In general.--The period during which an individual is
entitled to benefits under this title shall begin as follows,
but in no case earlier than January 1, 2005:
``(A) In the case of an individual who is enrolled under
paragraph (1) or (2) of subsection (b), the date of birth or
date of obtaining appropriate citizenship or immigration
status, as the case may be.
``(B) In the case of an another individual who enrolls
(including pre-enrolls) before the month in which the
individual satisfies eligibility for enrollment under
subsection (a), the first day of such month of eligibility.
``(C) In the case of an another individual who enrolls
during or after the month in which the individual first
satisfies eligibility for enrollment under such subsection,
the first day of the following month.
``(2) Authority to provide for partial months of
coverage.--Under regulations, the Secretary may, in the
Secretary's discretion, provide for coverage periods that
include portions of a month in order to avoid lapses of
coverage.
``(3) Limitation on payments.--No payments may be made
under this title with respect to the expenses of an
individual enrolled under this title unless such expenses
were incurred by such individual during a period which, with
respect to the individual, is a coverage period under this
section.
``(d) Expiration of Eligibility.--An individual's coverage
period under this part shall continue until the individual's
enrollment has been terminated because the individual no
longer meets the requirements of subsection (a) (whether
because of age or change in immigration status).
``(e) Entitlement to MediKids Benefits For Enrolled
Individuals.--An individual enrolled under this section is
entitled to the benefits described in section 2202.
``(f) Low-Income Information.--At the time of enrollment of
a child under this title, the Secretary shall make an inquiry
as to whether or not the family income of the family that
includes the child is less than 150 percent of the poverty
line for a family of the size involved. If the family income
is below such level, the Secretary shall encode in the
identification card issued in connection with eligibility
under this title a code indicating such fact. The Secretary
also shall provide for a toll-free telephone line at which
providers can verify whether or not such a child is in a
family the income of which is below such level.
``(g) Construction.--Nothing in this title shall be
construed as requiring (or preventing) an individual who is
enrolled under this section from seeking medical assistance
under a State medicaid plan under title XIX or child health
assistance under a State child health plan under title XXI.

[[Page S3510]]

``SEC. 2202. BENEFITS.

``(a) Secretarial Specification of Benefit Package.--
``(1) In general.--The Secretary shall specify the benefits
to be made available under this title consistent with the
provisions of this section and in a manner designed to meet
the health needs of enrollees.
``(2) Updating.--The Secretary shall update the
specification of benefits over time to ensure the inclusion
of age-appropriate benefits to reflect the enrollee
population.
``(3) Annual updating.--The Secretary shall establish
procedures for the annual review and updating of such
benefits to account for changes in medical practice, new
information from medical research, and other relevant
developments in health science.
``(4) Input.--The Secretary shall seek the input of the
pediatric community in specifying and updating such benefits.
``(5) Limitation on updating.--In no case shall updating of
benefits under this subsection result in a failure to provide
benefits required under subsection (b).
``(b) Inclusion of Certain Benefits.--
``(1) Medicare core benefits.--Such benefits shall include
(to the extent consistent with other provisions of this
section) at least the same benefits (including coverage,
access, availability, duration, and beneficiary rights) that
are available under parts A and B of title XVIII.
``(2) All required medicaid benefits.--Such benefits shall
also include all items and services for which medical
assistance is required to be provided under section
1902(a)(10)(A) to individuals described in such section,
including early and periodic screening, diagnostic services,
and treatment services.
``(3) Inclusion of prescription drugs.--Such benefits also
shall include (as specified by the Secretary) prescription
drugs and biologicals.
``(4) Cost-sharing.--
``(A) In general.--Subject to subparagraph (B), such
benefits also shall include the cost-sharing (in the form of
deductibles, coinsurance, and copayments) applicable under
title XVIII with respect to comparable items and services,
except that no cost-sharing shall be imposed with respect to
early and periodic screening and diagnostic services included
under paragraph (2).
``(B) No cost-sharing for lowest income children.--Such
benefits shall not include any cost-sharing for children in
families the income of which (as determined for purposes of
section 1905(p)) does not exceed 150 percent of the official
income poverty line (referred to in such section) applicable
to a family of the size involved.
``(C) Refundable credit for cost-sharing for other low-
income children.--For a refundable credit for cost-sharing in
the case of children in certain families, see section 35 of
the Internal Revenue Code of 1986.
``(c) Payment Schedule.--The Secretary, with the assistance
of the Medicare Payment Advisory Commission, shall develop
and implement a payment schedule for benefits covered under
this title. To the extent feasible, such payment schedule
shall be consistent with comparable payment schedules and
reimbursement methodologies applied under parts A and B of
title XVIII.
``(d) Input.--The Secretary shall specify such benefits and
payment schedules only after obtaining input from appropriate
child health providers and experts.
``(e) Enrollment in Health Plans.--The Secretary shall
provide for the offering of benefits under this title through
enrollment in a health benefit plan that meets the same (or
similar) requirements as the requirements that apply to
Medicare+Choice plans under part C of title XVIII. In the
case of individuals enrolled under this title in such a plan,
the Medicare+Choice capitation rate described in section
1853(c) shall be adjusted in an appropriate manner to reflect
differences between the population served under this title
and the population under title XVIII.

``SEC. 2203. PREMIUMS.

``(a) Amount of Monthly Premiums.--
``(1) In general.--The Secretary shall, during September of
each year (beginning with 2004), establish a monthly MediKids
premium for the following year. Subject to paragraph (2), the
monthly MediKids premium for a year is equal to \1/12\ of the
annual premium rate computed under subsection (b).
``(2) Elimination of monthly premium for demonstration of
equivalent coverage (including coverage under low-income
programs).--The amount of the monthly premium imposed under
this section for an individual for a month shall be zero in
the case of an individual who demonstrates to the
satisfaction of the Secretary that the individual has basic
health insurance coverage for that month. For purposes of the
previous sentence enrollment in a medicaid plan under title
XIX, a State child health insurance plan under title XXI, or
under the medicare program under title XVIII is deemed to
constitute basic health insurance coverage described in such
sentence.
``(b) Annual Premium.--
``(1) National, per capita average.--The Secretary shall
estimate the average, annual per capita amount that would be
payable under this title with respect to individuals residing
in the United States who meet the requirement of section
2201(a)(1) as if all such individuals were eligible for (and
enrolled) under this title during the entire year (and
assuming that section 1862(b)(2)(A)(i) did not apply).
``(2) Annual premium.--Subject to subsection (d), the
annual premium under this subsection for months in a year is
equal to 25 percent of the average, annual per capita amount
estimated under paragraph (1) for the year.
``(c) Payment of Monthly Premium.--
``(1) Period of payment.--In the case of an individual who
participates in the program established by this title,
subject to subsection (d), the monthly premium shall be
payable for the period commencing with the first month of the
individual's coverage period and ending with the month in
which the individual's coverage under this title terminates.
``(2) Collection through tax return.--For provisions
providing for the payment of monthly premiums under this
subsection, see section 59B of the Internal Revenue Code of
1986.
``(3) Protections against fraud and abuse.--The Secretary
shall develop, in coordination with States and other health
insurance issuers, administrative systems to ensure that
claims which are submitted to more than one payor are
coordinated and duplicate payments are not made.
``(d) Reduction in Premium for Certain Low-Income
Families.--For provisions reducing the premium under this
section for certain low-income families, see section 59B(c)
of the Internal Revenue Code of 1986.

``SEC. 2204. MEDIKIDS TRUST FUND.

``(a) Establishment of Trust Fund.--
``(1) In general.--There is hereby created on the books of
the Treasury of the United States a trust fund to be known as
the `MediKids Trust Fund' (in this section referred to as the
`Trust Fund'). The Trust Fund shall consist of such gifts and
bequests as may be made as provided in section 201(i)(1) and
such amounts as may be deposited in, or appropriated to, such
fund as provided in this title.
``(2) Premiums.--Premiums collected under section 2203
shall be transferred to the Trust Fund.
``(b) Incorporation of Provisions.--
``(1) In general.--Subject to paragraph (2), subsections
(b) through (i) of section 1841 shall apply with respect to
the Trust Fund and this title in the same manner as they
apply with respect to the Federal Supplementary Medical
Insurance Trust Fund and part B, respectively.
``(2) Miscellaneous references.--In applying provisions of
section 1841 under paragraph (1)--
``(A) any reference in such section to `this part' is
construed to refer to title XXII;
``(B) any reference in section 1841(h) to section 1840(d)
and in section 1841(i) to sections 1840(b)(1) and 1842(g) are
deemed references to comparable authority exercised under
this title;
``(C) payments may be made under section 1841(g) to the
Trust Funds under sections 1817 and 1841 as reimbursement to
such funds for payments they made for benefits provided under
this title; and
``(D) the Board of Trustees of the MediKids Trust Fund
shall be the same as the Board of Trustees of the Federal
Supplementary Medical Insurance Trust Fund.

``SEC. 2205. OVERSIGHT AND ACCOUNTABILITY.

``(a) Through Annual Reports of Trustees.--The Board of
Trustees of the MediKids Trust Fund under section 2204(b)(1)
shall report on an annual basis to Congress concerning the
status of the Trust Fund and the need for adjustments in the
program under this title to maintain financial solvency of
the program under this title.
``(b) Periodic GAO Reports.--The Comptroller General of the
United States shall periodically submit to Congress reports
on the adequacy of the financing of coverage provided under
this title. The Comptroller General shall include in such
report such recommendations for adjustments in such financing
and coverage as the Comptroller General deems appropriate in
order to maintain financial solvency of the program under
this title.

``SEC. 2206. INCLUSION OF CARE COORDINATION SERVICES.

``(a) In General.--
``(1) Program authority.--The Secretary, beginning in 2005,
may implement a care coordination services program in
accordance with the provisions of this section under which,
in appropriate circumstances, eligible individuals may elect
to have health care services covered under this title managed
and coordinated by a designated care coordinator.
``(2) Administration by contract.--The Secretary may
administer the program under this section through a contract
with an appropriate program administrator.
``(3) Coverage.--Care coordination services furnished in
accordance with this section shall be treated under this
title as if they were included in the definition of medical
and other health services under section 1861(s) and benefits
shall be available under this title with respect to such
services without the application of any deductible or
coinsurance.
``(b) Eligibility Criteria; Identification and Notification
of Eligible Individuals.--
``(1) Individual eligibility criteria.--The Secretary shall
specify criteria to be used in making a determination as to
whether an individual may appropriately be enrolled in the
care coordination services program under this section, which
shall include at least a finding by the Secretary that for
cohorts of individuals with characteristics

[[Page S3511]]

identified by the Secretary, professional management and
coordination of care can reasonably be expected to improve
processes or outcomes of health care and to reduce aggregate
costs to the programs under this title.
``(2) Procedures to facilitate enrollment.--The Secretary
shall develop and implement procedures designed to facilitate
enrollment of eligible individuals in the program under this
section.
``(c) Enrollment of Individuals.--
``(1) Secretary's determination of eligibility.--The
Secretary shall determine the eligibility for services under
this section of individuals who are enrolled in the program
under this section and who make application for such services
in such form and manner as the Secretary may prescribe.
``(2) Enrollment period.--
``(A) Effective date and duration.--Enrollment of an
individual in the program under this section shall be
effective as of the first day of the month following the
month in which the Secretary approves the individual's
application under paragraph (1), shall remain in effect for
one month (or such longer period as the Secretary may
specify), and shall be automatically renewed for additional
periods, unless terminated in accordance with such procedures
as the Secretary shall establish by regulation. Such
procedures shall permit an individual to disenroll for cause
at any time and without cause at re-enrollment intervals.
``(B) Limitation on reenrollment.--The Secretary may
establish limits on an individual's eligibility to reenroll
in the program under this section if the individual has
disenrolled from the program more than once during a
specified time period.
``(d) Program.--The care coordination services program
under this section shall include the following elements:
``(1) Basic care coordination services.--
``(A) In general.--Subject to the cost-effectiveness
criteria specified in subsection (b)(1), except as otherwise
provided in this section, enrolled individuals shall receive
services described in section 1905(t)(1) and may receive
additional items and services as described in subparagraph
(B).
``(B) Additional benefits.--The Secretary may specify
additional benefits for which payment would not otherwise be
made under this title that may be available to individuals
enrolled in the program under this section (subject to an
assessment by the care coordinator of an individual's
circumstance and need for such benefits) in order to
encourage enrollment in, or to improve the effectiveness of,
such program.
``(2) Care coordination requirement.--Notwithstanding any
other provision of this title, the Secretary may provide that
an individual enrolled in the program under this section may
be entitled to payment under this title for any specified
health care items or services only if the items or services
have been furnished by the care coordinator, or coordinated
through the care coordination services program. Under such
provision, the Secretary shall prescribe exceptions for
emergency medical services as described in section
1852(d)(3), and other exceptions determined by the Secretary
for the delivery of timely and needed care.
``(e) Care Coordinators.--
``(1) Conditions of participation.--In order to be
qualified to furnish care coordination services under this
section, an individual or entity shall--
``(A) be a health care professional or entity (which may
include physicians, physician group practices, or other
health care professionals or entities the Secretary may find
appropriate) meeting such conditions as the Secretary may
specify;
``(B) have entered into a care coordination agreement; and
``(C) meet such criteria as the Secretary may establish
(which may include experience in the provision of care
coordination or primary care physician's services).
``(2) Agreement term; payment.--
``(A) Duration and renewal.--A care coordination agreement
under this subsection shall be for one year and may be
renewed if the Secretary is satisfied that the care
coordinator continues to meet the conditions of participation
specified in paragraph (1).
``(B) Payment for services.--The Secretary may negotiate or
otherwise establish payment terms and rates for services
described in subsection (d)(1).
``(C) Liability.--Case coordinators shall be subject to
liability for actual health damages which may be suffered by
recipients as a result of the care coordinator's decisions,
failure or delay in making decisions, or other actions as a
care coordinator.
``(D) Terms.--In addition to such other terms as the
Secretary may require, an agreement under this section shall
include the terms specified in subparagraphs (A) through (C)
of section 1905(t)(3).

``SEC. 2207. ADMINISTRATION AND MISCELLANEOUS.

``(a) In General.--Except as otherwise provided in this
title--
``(1) the Secretary shall enter into appropriate contracts
with providers of services, other health care providers,
carriers, and fiscal intermediaries, taking into account the
types of contracts used under title XVIII with respect to
such entities, to administer the program under this title;
``(2) individuals enrolled under this title shall be
treated for purposes of title XVIII as though the individual
were entitled to benefits under part A and enrolled under
part B of such title;
``(3) benefits described in section 2202 that are payable
under this title to such individuals shall be paid in a
manner specified by the Secretary (taking into account, and
based to the greatest extent practicable upon, the manner in
which they are provided under title XVIII);
``(4) provider participation agreements under title XVIII
shall apply to enrollees and benefits under this title in the
same manner as they apply to enrollees and benefits under
title XVIII; and
``(5) individuals entitled to benefits under this title may
elect to receive such benefits under health plans in a
manner, specified by the Secretary, similar to the manner
provided under part C of title XVIII.
``(b) Coordination With Medicaid and SCHIP.--
Notwithstanding any other provision of law, individuals
entitled to benefits for items and services under this title
who also qualify for benefits under title XIX or XXI or any
other Federally funded program may continue to qualify and
obtain benefits under such other title or program, and in
such case such an individual shall elect either--
``(1) such other title or program to be primary payor to
benefits under this title, in which case no benefits shall be
payable under this title and the monthly premium under
section 2203 shall be zero; or
``(2) benefits under this title shall be primary payor to
benefits provided under such program or title, in which case
the Secretary shall enter into agreements with States as may
be appropriate to provide that, in the case of such
individuals, the benefits under titles XIX and XXI or such
other program (including reduction of cost-sharing) are
provided on a `wrap-around' basis to the benefits under this
title.''.
(b) Conforming Amendments to Social Security Act
Provisions.--
(1) Section 201(i)(1) of the Social Security Act (42 U.S.C.
401(i)(1)) is amended by striking ``or the Federal
Supplementary Medical Insurance Trust Fund'' and inserting
``the Federal Supplementary Medical Insurance Trust Fund, and
the MediKids Trust Fund''.
(2) Section 201(g)(1)(A) of such Act (42 U.S.C.
401(g)(1)(A)) is amended by striking `` and the Federal
Supplementary Medical Insurance Trust Fund established by
title XVIII'' and inserting ``, the Federal Supplementary
Medical Insurance Trust Fund, and the MediKids Trust Fund
established by title XVIII''.
(3) Section 1853(c) of such Act (42 U.S.C. 1395w-23(c)) is
amended--
(A) in paragraph (1), by striking ``or (7)'' and inserting
``, (7), or (8)'', and
(B) by adding at the end the following:
``(8) Adjustment for medikids.--In applying this subsection
with respect to individuals entitled to benefits under title
XXII, the Secretary shall provide for an appropriate
adjustment in the Medicare+Choice capitation rate as may be
appropriate to reflect differences between the population
served under such title and the population under parts A and
B.''.
(c) Maintenance of Medicaid Eligibility and Benefits for
Children.--
(1) In general.--In order for a State to continue to be
eligible for payments under section 1903(a) of the Social
Security Act (42 U.S.C. 1396b(a))--
(A) the State may not reduce standards of eligibility, or
benefits, provided under its State medicaid plan under title
XIX of the Social Security Act or under its State child
health plan under title XXI of such Act for individuals under
23 years of age below such standards of eligibility, and
benefits, in effect on the date of the enactment of this Act;
and
(B) the State shall demonstrate to the satisfaction of the
Secretary of Health and Human Services that any savings in
State expenditures under title XIX or XXI of the Social
Security Act that results from children from enrolling under
title XXII of such Act shall be used in a manner that
improves services to beneficiaries under title XIX of such
Act, such as through increases in provider payment rates,
expansion of eligibility, improved nurse and nurse aide
staffing and improved inspections of nursing facilities, and
coverage of additional services.
(2) Medikids as primary payor.--In applying title XIX of
the Social Security Act, the MediKids program under title
XXII of such Act shall be treated as a primary payor in cases
in which the election described in section 2207(b)(2) of such
Act, as added by subsection (a), has been made.
(d) Expansion of MedPAC Membership to 19.--
(1) In general.--Section 1805(c) of the Social Security Act
(42 U.S.C. 1395b-6(c)) is amended--
(A) in paragraph (1), by striking ``17'' and inserting
``19''; and
(B) in paragraph (2)(B), by inserting ``experts in
children's health,'' after ``other health professionals,''.
(2) Initial terms of additional members.--
(A) In general.--For purposes of staggering the initial
terms of members of the Medicare Payment Advisory Commission
under section 1805(c)(3) of the Social Security Act (42
U.S.C. 1395b-6(c)(3)), the initial terms of the 2 additional
members of the Commission provided for by the amendment under
subsection (a)(1) are as follows:
(i) One member shall be appointed for 1 year.
(ii) One member shall be appointed for 2 years.

[[Page S3512]]

(B) Commencement of terms.--Such terms shall begin on
January 1, 2004.

SEC. 3. MEDIKIDS PREMIUM.

(a) General Rule.--Subchapter A of chapter 1 of the
Internal Revenue Code of 1986 (relating to determination of
tax liability) is amended by adding at the end the following
new part:

``PART VIII--MEDIKIDS PREMIUM

``Sec. 59B. MediKids premium.

``SEC. 59B. MEDIKIDS PREMIUM.

``(a) Imposition of Tax.--In the case of an individual to
whom this section applies, there is hereby imposed (in
addition to any other tax imposed by this subtitle) a
MediKids premium for the taxable year.
``(b) Individuals Subject to Premium.--
``(1) In general.--This section shall apply to an
individual if the taxpayer has a MediKid at any time during
the taxable year.
``(2) Medikid.--For purposes of this section, the term
`MediKid' means, with respect to a taxpayer, any individual
with respect to whom the taxpayer is required to pay a
premium under section 2203(c) of the Social Security Act for
any month of the taxable year.
``(c) Amount of Premium.--For purposes of this section, the
MediKids premium for a taxable year is the sum of the monthly
premiums under section 2203 of the Social Security Act for
months in the taxable year.
``(d) Exceptions Based on Adjusted Gross Income.--
``(1) Exemption for very low-income taxpayers.--
``(A) In general.--No premium shall be imposed by this
section on any taxpayer having an adjusted gross income not
in excess of the exemption amount.
``(B) Exemption amount.--For purposes of this paragraph,
the exemption amount is--
``(i) $17,910 in the case of a taxpayer having 1 MediKid,
``(ii) $22,530 in the case of a taxpayer having 2 MediKids,
``(iii) $27,150 in the case of a taxpayer having 3
MediKids, and
``(iv) $31,770 in the case of a taxpayer having 4 or more
MediKids.
``(C) Phaseout of exemption.--In the case of a taxpayer
having an adjusted gross income which exceeds the exemption
amount but does not exceed twice the exemption amount, the
premium shall be the amount which bears the same ratio to the
premium which would (but for this subparagraph) apply to the
taxpayer as such excess bears to the exemption amount.
``(D) Inflation adjustment of exemption amounts.--In the
case of any taxable year beginning in a calendar year after
2002, each dollar amount contained in subparagraph (C) shall
be increased by an amount equal to the product of--
``(i) such dollar amount, and
``(ii) the cost-of-living adjustment determined under
section 1(f)(3) for the calendar year in which the taxable
year begins, determined by substituting `calendar year 2001'
for `calendar year 1992' in subparagraph (B) thereof.
If any increase determined under the preceding sentence is
not a multiple of $50, such increase shall be rounded to the
nearest multiple of $50.
``(2) Premium limited to 5 percent of adjusted gross
income.--In no event shall any taxpayer be required to pay a
premium under this section in excess of an amount equal to 5
percent of the taxpayer's adjusted gross income.
``(e) Coordination With Other Provisions.--
``(1) Not treated as medical expense.--For purposes of this
chapter, any premium paid under this section shall not be
treated as expense for medical care.
``(2) Not treated as tax for certain purposes.--The premium
paid under this section shall not be treated as a tax imposed
by this chapter for purposes of determining--
``(A) the amount of any credit allowable under this
chapter, or
``(B) the amount of the minimum tax imposed by section 55.
``(3) Treatment under subtitle f.--For purposes of subtitle
F, the premium paid under this section shall be treated as if
it were a tax imposed by section 1.''.
(b) Technical Amendments.--
(1) Subsection (a) of section 6012 of such Code is amended
by inserting after paragraph (9) the following new paragraph:
``(10) Every individual liable for a premium under section
59B.''.
(2) The table of parts for subchapter A of chapter 1 of
such Code is amended by adding at the end the following new
item:

``Part VIII. MediKids premium.''.
(c) Effective Date.--The amendments made by this section
shall apply to months beginning after December 2004, in
taxable years ending after such date.

SEC. 4. REFUNDABLE CREDIT FOR COST-SHARING EXPENSES UNDER
MEDIKIDS PROGRAM.

(a) In General.--Subpart C of part IV of subchapter A of
chapter 1 of the Internal Revenue Code of 1986 (relating to
refundable credits) is amended by redesignating section 36 as
section 37 and by inserting after section 35 the following
new section:

``SEC. 36. COST-SHARING EXPENSES UNDER MEDIKIDS PROGRAM.

``(a) Allowance of Credit.--In the case of an individual
who has a MediKid (as defined in section 59B) at any time
during the taxable year, there shall be allowed as a credit
against the tax imposed by this subtitle an amount equal to
50 percent of the amount paid by the taxpayer during the
taxable year as cost-sharing under section 2202(b)(4) of the
Social Security Act.
``(b) Limitation Based on Adjusted Gross Income.--The
amount of the credit which would (but for this subsection) be
allowed under this section for the taxable year shall be
reduced (but not below zero) by an amount which bears the
same ratio to such amount of credit as the excess of the
taxpayer's adjusted gross income for such taxable year over
the exemption amount (as defined in section 59B(d)) bears to
such exemption amount.''.
(b) Technical Amendments.--
(1) Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting before the period ``or
from section 36 of such Code''.
(2) The table of sections for subpart C of part IV of
subchapter A of chapter 1 of such Code is amended by striking
the last item and inserting the following new items:

``Sec. 36. Cost-sharing expenses under MediKids program.
``Sec. 37. Overpayments of tax.''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2004.

SEC. 5. REPORT ON LONG-TERM REVENUES.

Within one year after the date of the enactment of this
Act, the Secretary of the Treasury shall propose a gradual
schedule of progressive tax changes to fund the program under
title XXII of the Social Security Act, as the number of
enrollees grows in the out-years.
______