Title I — Medicaid

“(g) Comprehensive Medicaid Waivers

“(1) Authority

“(A) In general—A State may elect to provide medical assistance under title XIX, directly or by contract, to eligible individuals pursuant to a comprehensive Medicaid waiver under this subsection in lieu of providing such assistance under a State plan approved under title XIX or a waiver approved under subsection (d) or extended under subsection (e). A State shall make such an election by submitting a waiver application to the Secretary for certification that the application satisfies the requirements of paragraph (2).

“(B) Waiver of State Medicaid program requirements—Any requirements applicable under this title or title XIX that would prevent a State from carrying out a comprehensive Medicaid waiver in accordance with the State's certified application and the requirements of this subsection are deemed waived.

“(C) Shared savings bonus—A State conducting a comprehensive Medicaid waiver under this subsection shall be eligible for a shared savings bonus in accordance with paragraph (4).

“(D) Option to include CHIP-eligible individuals—A State may elect to treat individuals eligible for child health assistance under the State child health plan under title XXI as eligible individuals under a comprehensive Medicaid waiver. The waiver application and determination of the aggregate spending cap for the State for the waiver period shall take into account the inclusion of such individuals in the comprehensive Medicaid waiver. Any requirements applicable under this title, title XIX, or title XXI that would prevent a State from including such individuals in the comprehensive Medicaid waiver in accordance with the State's certified application and the requirements of this subsection are deemed waived.

“(2) Comprehensive Medicaid waiver application—An application for a comprehensive Medicaid waiver under this subsection shall contain the following:

“(A) General description of proposed benefit delivery models, eligibility criteria, and benefits—A brief description, which may be in outline form, of the eligibility criteria and medical assistance to be provided that includes the methods for delivery of such assistance, the criteria for the determination of eligibility for such assistance, and the amount, duration, and scope of such assistance, including a description of the amount (if any) of premiums, deductibles, coinsurance, or other cost-sharing.

“(B) HEDIS measures to evaluate performance

“(i) In general—A description of not less than 20 of the standard Medicaid Healthcare Effectiveness Data and Information Set (HEDIS) measures established by the National Committee for Quality Assurance selected by the State to annually evaluate the quality and cost-effectiveness of the medical assistance provided under the waiver, and for each such measure (and, if applicable, the distinct rates associated with the measure), the baseline data and the target performance goal applicable for each such measure or rate. The State shall select HEDIS measures that are closely aligned with the health care items and services that are provided to eligible individuals as medical assistance under the waiver.

“(ii) Evaluation—The description under this subparagraph shall specify the independent entity that the State will use to evaluate the waiver. The State shall provide an assurance that the State will submit a copy of the annual evaluation to the Secretary.

“(C) Program integrity—A brief description of the State's program to prevent waste, fraud, and abuse under the waiver.

“(D) Aggregate spending cap—An assurance that the State agrees—

“(i) to establish categories that accurately account for each of the distinct population groups that will qualify as eligible individuals under the waiver (such as children, parents, pregnant women, and the blind or disabled) based on such criteria as are determined appropriate by the State (referred to in this subsection as a population category);

“(ii) to provide the Secretary with all data relevant to the determination of the aggregate spending cap for the State for the waiver period, as determined by the Secretary under paragraph (3)(B); and

“(iii) with respect to each period for which the waiver is approved, to not receive any Federal payments from the Secretary for amounts expended during such period that exceed the aggregate spending cap.

“(3) Determination of aggregate spending cap

“(A) Establishment of spending template

“(i) In general—The Secretary, in coordination with the Director of the Office of Management and Budget (referred to in this subsection as the Director), shall establish a template for determining, with respect to each State, the aggregate spending cap for each period for which the State conducts a comprehensive Medicaid waiver under this subsection. The Secretary shall—

“(I) publish a proposed template not later than 60 days after the date of enactment of this subsection;

“(II) provide for a period for public comment on the proposed template; and

“(III) promulgate a final template not later than 120 days after such date of enactment.

“(ii) Revisions

“(I) In general—Subject to subclause (II), the Secretary, in coordination with the Director, shall revise the template, as appropriate, not less than every 5 years pursuant to a process that allows for public comment prior to publication of the revised template.

“(II) Technical changes—The Secretary or the Director may make any necessary technical or conforming changes to the template at such times and in such manner as is determined appropriate.

“(B) Determination of aggregate spending cap for each State

“(i) In general—Subject to subparagraph (C), the aggregate spending cap applicable to a State for a waiver period shall be equal to 99 percent of the amount determined under clause (ii).

“(ii) Total amount of projected Federal payments—The amount described in this clause is equal to the sum of—

“(I) the total amount of Federal payments that would otherwise be made to the State during the waiver period with respect to any disproportionate share payment adjustment made under section 1923; and

“(II) the sum of the amounts determined under clause (iii) for each population category.

“(iii) Projected Federal payments for medical assistance provided to population categories—For purposes of clause (ii)(II), the Secretary and the Director shall calculate the amount of projected expenditures for the provision of medical assistance to eligible individuals in each population category during the waiver period (as determined based upon the population categories established and the data provided by the State pursuant to paragraph (2)(D), as well as the annual baseline estimates supplied by the Director and such other data as is determined appropriate by the Secretary), which shall be equal to the product of—

“(I) subject to clause (iv), the monthly per capita amount of Federal payments that were made to the State under the State plan under title XIX (or under a waiver approved under subsection (d) or extended under subsection (e)) for an individual in such population category during the fiscal year prior to the State application for the waiver (referred to in this paragraph as the population category per capita baseline);

“(II) the number of individuals within such population category that are projected to be eligible to receive medical assistance during the waiver period; and

“(III) the number of months in the waiver period.

“(iv) Population categories with no baseline data—For purposes of any determination under clause (iii)(I) for a population category that lacks sufficient data to calculate the population category per capita baseline and that consists of individuals for which the State would otherwise be required to provide medical assistance to pursuant to section 1902(a)(10)(A)(i)(VIII), the population category per capita baseline shall be equal to the monthly per capita amount of Federal payments that would otherwise have been made to the State under the State plan under title XIX (or under a waiver approved under subsection (d) or extended under subsection (e)) during the preceding fiscal year for an individual who is under 65 years of age, not pregnant, not entitled to, or enrolled for, benefits under part A of title XVIII, or enrolled for benefits under part B of title XVIII.

“(v) Budget neutrality—In no event shall the aggregate spending cap established for a State for a waiver period allow for Federal payments to the State during the waiver period that exceed the amount of Federal payments to the State that would have been made during that period if the State had not elected to conduct a comprehensive Medicaid waiver under this subsection during the period.

“(C) Adjustment of aggregate spending cap for high unemployment—For purposes of subparagraph (B)(i), if the average monthly unemployment rate (as defined in paragraph (8)(A)) for a State exceeds 10 percent for any consecutive period of at least 6 months occurring during the waiver period, the aggregate spending cap applicable to the State for such waiver period shall be equal to 100 percent of the amount determined under subparagraph (B)(ii).

“(4) Shared savings bonuses

“(A) In general—The Secretary shall annually pay each State conducting a comprehensive Medicaid waiver under this subsection an amount equal to 25 percent of the waiver savings determined with respect to a State and a waiver period under subparagraph (C).

“(B) Dedicated to health care—A State that receives a payment under this paragraph shall spend not less than 80 percent of the payment on health care services or health-related activities for eligible individuals.

“(C) Determination of waiver savings—The Secretary and the Director shall establish a process for determining with respect to a State and a waiver period the amount of savings achieved by a State for the period. The process shall take into account the difference between the aggregate spending cap applicable to the State for the waiver period and the total amount expended by the State under the waiver for the period.

“(D) Payment; retrospective adjustment—The Secretary shall make annual payments under this paragraph on the basis of claims submitted by the State for expenses paid by the State for medical assistance provided under the waiver, and such other investigation as the Secretary or the Director may find necessary, and may reduce or increase the payments as necessary to adjust for prior overpayments or under payments under this paragraph.

“(5) Duration

“(A) In general—A State shall conduct a comprehensive Medicaid waiver under this subsection for a 5-year period. Subject to subparagraph (B), a comprehensive Medicaid waiver may be renewed for additional 3-year periods upon the request of the State, unless within 90 days after receipt of a State request for a renewal of a waiver, the Secretary and the Director determine, based on the State evaluations required under paragraph (2)(B), that the waiver should not be renewed.

“(B) State evaluations and target performance goals—For purposes of subparagraph (A), the Secretary and the Director may not renew a waiver unless each of the measures or rates selected by the State pursuant to paragraph (2)(B) has improved or remained constant during the waiver period.

“(6) Limited Secretarial authority; administrative and judicial review

“(A) Certification of waiver applications

“(i) In general—Except as provided under clause (ii), the Secretary and the Director shall have 90 days from receipt of an application by a State for a comprehensive Medicaid waiver to certify the application as satisfying the requirements of paragraph (2).

“(ii) Inquiries—The Secretary and the Director may submit a single set of inquiries for additional information to the State during the initial 90-day period described under clause (i). If a State receives a set of inquires, the State shall have up to 60 days to respond. The Secretary and the Director shall have an additional 30-day period, starting on the date the Secretary receives a State response to a set of inquiries, to make a final determination as to whether the State's waiver application may be certified as complying with the requirements of paragraph (2).

“(iii) Failure to respond by the Secretary—An application by a State for a comprehensive Medicaid waiver shall be deemed certified by the Secretary if the Secretary does not submit any inquiries during the initial 90-day review period.

“(iv) Effective date—A waiver that has been certified by the Secretary (or deemed to be certified) may be effective, at the discretion of the State, as of the first day of the calendar quarter in which the application for the waiver was submitted by the State.

“(B) Denial of waiver applications or renewal requests

“(i) In general—If the Secretary and the Director determine that an application for a comprehensive Medicaid waiver, or a request for extension of an existing comprehensive Medicaid waiver, does not satisfy the requirements of paragraph (2), the Secretary shall notify the State of the disapproval by written notification, not later than 10 days following the issuance of such determination and shall provide a detailed description of the reasons for the denial of the waiver to—

“(I) the State that submitted the waiver application or extension request;

“(II) the members of Congress representing such State; and

“(III) the Committee on Finance of the Senate and the Committee on Energy and Commerce of the House of Representatives.

“(ii) Administrative and judicial review

“(I) Administrative review—Within 60 days after the date that a State receives notice of the denial of a waiver application or extension request, the State may appeal the determination to the Departmental Appeals Board established in the Department of Health and Human Services. The Departmental Appeals Board shall make a final determination with respect to an appeal filed under this subparagraph not less than 60 days after the date on which the appeal is filed.

“(II) Judicial review—Within 60 days after the date of a final decision by the Board under subclause (I) that is adverse to a State, the State may obtain judicial review of the final decision by filing an action in the district court of the United States for the judicial district in which the principal or headquarters office of the State agency responsible for administering the State Medicaid program is located or the United States District Court for the District of Columbia.

“(C) Reports

“(i) In general—Not later than 2 years after the date on which the Secretary and the Director first approve an application for a comprehensive Medicaid waiver under this subsection and every 3 years thereafter, the Comptroller General of the United States (referred to in this subparagraph as the Comptroller) shall submit to the Committee on Finance of the Senate and the Committee on Energy and Commerce of the House of Representatives a report on the waivers certified as of the date of such report. Each report shall include an evaluation of the quality and cost-effectiveness of the comprehensive Medicaid waivers in effect during the reporting period in providing medical assistance to eligible individuals, as well as the financial effort of the waiver on State and Federal budgets.

“(ii) Reporting of information—A State with a comprehensive Medicaid waiver under this subsection shall provide the Comptroller, in such form and manner as the Comptroller may require, with any relevant information regarding the waiver, including total expenditures by the State under the waiver, the number of individuals provided medical assistance under the waiver, and such other information as the Comptroller may require for purposes of preparing the reports required under this subparagraph.

“(7) Non-applications—A comprehensive Medicaid waiver shall not apply to—

“(A) the pediatric vaccine program under section 1928; and

“(B) limitations on total payments to territories under section 1108.

“(8) Outreach and education

“(A) State awareness—Not later than 30 days after the date of enactment of this subsection, the Secretary shall conduct an outreach and education campaign to States regarding the availability of comprehensive Medicaid waivers under this subsection.

“(B) Public notice and comment—Before submitting an application for a comprehensive Medicaid waiver, a State shall make the proposed application available to the public through such means as the State determines appropriate and allow for a reasonable public comment period of not greater than 30 days.

“(C) Public awareness of approved waiver—A State that has been certified for a comprehensive Medicaid waiver shall conduct an outreach and education campaign to ensure that health care providers and eligible individuals within the State are provided with adequate notice regarding the methods and criteria through which the State intends to provide medical assistance under the waiver.

“(9) Definitions—In this subsection:

“(A) Average monthly unemployment rate—The term average monthly unemployment rate means the average of the monthly number unemployed in the State, divided by the average of the monthly civilian labor force in the State, seasonally adjusted, as determined based on the most recent monthly publications of the Bureau of Labor Statistics of the Department of Labor.

“(B) Eligible individual—The term eligible individual means, for each year during the waiver period—

“(i) any individual who, for such year, the State would otherwise be required to provide medical assistance to pursuant to—

“(I) section 1902(a)(10)(A)(i);

“(II) paragraphs (1) or (4) of section 1902(e);

“(III) section 1925; or

“(IV) section 1931; and

“(ii) at the option of the State, any individual who, for such year, the State would otherwise provide child health assistance to under the State child health plan under title XXI; and

“(iii) at the option of the State, any individual who is not described in clause (i) or (ii) and who satisfies such income, resources, health status, or other criteria as the State may establish.

“(C) Medical assistance—The term medical assistance means—

“(i) health care coverage (as determined by the State); and

“(ii) rehabilitation and other services to help eligible individuals attain or retain capability for independence or self-care, such as home and community-based services.

“(D) State Medicaid program—The term State Medicaid program means the State program for medical assistance provided under a State plan under title XIX, including any waiver that has been approved with respect to a State plan prior to an application by the State for a comprehensive Medicaid waiver under this subsection.”