text: 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.
target: 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.
feat_title: A bill to amend title XXI of the Social Security Act to expand the provision of child health assistance to children with family income up to 300 percent of poverty.