FamilyCare Act of 2001

FamilyCare Act of 2001 - Renames the State Children's Health Insurance program (SCHIP) under title XXI of the Social Security Act (SSA) as the FamilyCare program to provide for: (1) FamilyCare coverage of parents under Medicaid (SSA title XIX) as well as under new SSA title XXI; (2) optional FamilyCare coverage of parents of targeted low-income children; (3) automatic eligibility for FamilyCare coverage of children born to a parent on Family Care assistance; (4) optional coverage of legal immigrants and of children through age 20 under Medicaid and FamilyCare; (5) application of simplified FamilyCare procedures under Medicaid; (6) increased welfare-to-work transition (from six to 12 months) under Medicaid; (7) elimination of the 100 hour rule and other SSA title IV part A (Temporary Assistance for Needy Families) (TANF) related eligibility restrictions under Medicaid; (8) limitations on specified conflicts of interests under Medicaid and FamilyCare; (9) increased FamilyCare allotment for FY 2002 through 2004; and (10) authority to pay Medicaid expansion costs from the FamilyCare appropriation.

Directs the Secretary of Health and Human Services to establish a program to award demonstration grants to States to allow them to demonstrate the effectiveness of innovative ways to increase access to health insurance through market reforms and other innovative means.

Authorizes the Secretary to award demonstration grants to a limited number of States to conduct innovative programs designed to improve outreach to homeless individuals and families under specified programs for the homeless (including Medicaid and FamilyCare) with respect to enrollment of such individuals and families and the provision of services under such programs.