‘‘(1) DESCRIPTION; GENERAL CONDITIONS.—An 
expansion phase (phase I) plan shall include a de-
scription, consistent with this subsection, of the 
amount (if any) of premiums, cost-sharing, or other 
similar charges imposed. Any such charges shall be 
imposed pursuant to a public schedule. 
‘‘(2) LIMITATIONS
ON
PREMIUMS
AND
COST- 
SHARING.— 
‘‘(A) INDIVIDUALS AND FAMILIES WITH IN-
COME
BELOW
150
PERCENT
OF
POVERTY 
LINE.—In the case of an individual or family 
whose income is at or below 150 percent of the 
poverty line— 
‘‘(i) the State plan may not impose a 
premium; and 
‘‘(ii) 
the 
total 
annual 
aggregate 
amount of cost-sharing imposed by a State 
with respect to all individuals in a family 
may not exceed 0.5 percent of the family’s 
income for the year involved. 
‘‘(B) INDIVIDUALS
AND
FAMILIES
WITH 
INCOME BETWEEN 150 AND 300 PERCENT OF 
POVERTY LINE.—In the case of an individual or 
family whose income exceeds 150 percent but
does not exceed 300 percent of the poverty 
line— 
‘‘(i) the State plan may not impose a 
premium that exceeds an amount that is 
equal to— 
‘‘(I) 20 percent of the average 
cost of providing benefits to an indi-
vidual (or a family) under this part in 
the year involved; or 
‘‘(II) 3 percent of the family’s in-
come for the year involved; and 
‘‘(ii) 
the 
total 
annual 
aggregate 
amount of premiums and cost-sharing 
(combined) imposed by a State with re-
spect to all individuals in a family may not 
exceed 5 percent of the family’s income for 
the year involved. 
‘‘(C) INDIVIDUALS AND FAMILIES WITH IN-
COME
ABOVE
300
PERCENT
OF
POVERTY 
LINE.—In the case of an individual or family 
whose income exceeds 300 percent of the pov-
erty line— 
‘‘(i) the State plan may not impose a 
premium that exceeds 20 percent of the 
average cost of providing benefits to an in-
dividual (or a family of the size involved) 
under this part in the year involved; and 
‘‘(ii) 
the 
total 
annual 
aggregate 
amount of premiums and cost-sharing 
(combined) imposed by a State with re-
spect to all individuals in a family may not 
exceed 7 percent of the family’s income for 
the year involved. 
‘‘(D) SELF-EMPLOYED INDIVIDUALS.—The 
State shall establish rules for self-employed in-
dividuals based on individual and family in-
come. 
‘‘(3) COLLECTION.—The State shall establish 
procedures for collecting any premiums, cost-shar-
ing, or other similar charges imposed under this 
part. Such procedures shall provide for annual rec-
onciliations and adjustments. 
‘‘(c) APPLICATION OF CERTAIN REQUIREMENTS.— 
‘‘(1) RESTRICTION ON APPLICATION OF PRE-
EXISTING CONDITION EXCLUSIONS.—The expansion 
phase (phase I) plan shall not permit the imposition 
of any preexisting condition exclusion for covered 
benefits under the plan. 
‘‘(2) CHOICE OF PLANS.—
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), the expansion phase (phase 
I) plan shall offer eligible individuals and fami-
lies a choice of qualified plans from which to re-
ceive benefits under this part. At least 1 plan 
shall be a preferred provider option plan. 
‘‘(B) WAIVER.—The Secretary— 
‘‘(i) may waive the requirement under 
subparagraph (A) if determined appro-
priate; and 
‘‘(ii) shall waive such requirement in 
the case of a State that establishes a single 
State plan. 
‘‘SEC. 2204. ALLOTMENTS. 
‘‘(a) STATE ALLOTMENTS.— 
‘‘(1) IN
GENERAL.—With respect to a fiscal 
year, the Secretary shall allot to each State with an 
expansion phase (phase I) plan approved under this 
part the amount determined under paragraph (2) for 
such State for such fiscal year. 
‘‘(2) DETERMINATION
OF
COST
OF
COV-
ERAGE.—The amount determined under this para-
graph is the amount equal to— 
‘‘(A) the product of—