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‘‘(B) verifying the eligibility of individuals 
for medical assistance under the State plan. 
‘‘(3) An interagency or other agreement, con-
sistent with standards developed by the Secretary— 
‘‘(A) prevents the unauthorized use, disclo-
sure, or modification of such data and other-
wise meets applicable Federal requirements 
safeguarding privacy and data security; and 
‘‘(B) requires the State agency admin-
istering the State plan to use the data and in-
formation obtained under this section to seek to 
enroll individuals in the plan. 
‘‘(c) PENALTIES FOR IMPROPER DISCLOSURE.— 
‘‘(1) CIVIL MONEY PENALTY.—A private entity 
described in the subsection (a) that publishes, dis-
closes, or makes known in any manner, or to any ex-
tent not authorized by Federal law, any information 
obtained under this section is subject to a civil 
money penalty in an amount equal to $10,000 for 
each such unauthorized publication or disclosure. 
The provisions of section 1128A (other than sub-
sections (a) and (b) and the second sentence of sub-
section (f)) shall apply to a civil money penalty 
under this paragraph in the same manner as such 
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HR 3963 PCS 
provisions apply to a penalty or proceeding under 
section 1128A(a). 
‘‘(2) CRIMINAL PENALTY.—A private entity de-
scribed in the subsection (a) that willfully publishes, 
discloses, or makes known in any manner, or to any 
extent not authorized by Federal law, any informa-
tion obtained under this section shall be fined not 
more than $10,000 or imprisoned not more than 1 
year, or both, for each such unauthorized publication 
or disclosure. 
‘‘(d) RULE OF CONSTRUCTION.—The limitations and 
requirements that apply to disclosure pursuant to this sec-
tion shall not be construed to prohibit the conveyance or 
disclosure of data or information otherwise permitted 
under Federal law (without regard to this section).’’. 
(2) CONFORMING AMENDMENT TO TITLE XXI.— 
Section 2107(e)(1) (42 U.S.C. 1397gg(e)(1)), as 
amended by subsection (a)(2), is amended by adding 
at the end the following new subparagraph: 
‘‘(F) Section 1939 (relating to authoriza-
tion to receive data directly relevant to eligi-
bility determinations).’’. 
(3) CONFORMING AMENDMENT TO PROVIDE AC-
CESS TO DATA ABOUT ENROLLMENT IN INSURANCE 
FOR PURPOSES OF EVALUATING APPLICATIONS AND 
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HR 3963 PCS 
FOR
CHIP.—Section 1902(a)(25)(I)(i) (42 U.S.C. 
1396a(a)(25)(I)(i)) is amended— 
(A) by inserting ‘‘(and, at State option, in-
dividuals who apply or whose eligibility for med-
ical assistance is being evaluated in accordance 
with section 1902(e)(13)(D))’’ after ‘‘with re-
spect to individuals who are eligible’’; and 
(B) by inserting ‘‘under this title (and, at 
State option, child health assistance under title 
XXI)’’ after ‘‘the State plan’’. 
(e) AUTHORIZATION
FOR STATES ELECTING EX-
PRESS LANE OPTION TO RECEIVE CERTAIN DATA DI-
RECTLY RELEVANT TO DETERMINING ELIGIBILITY AND 
CORRECT AMOUNT OF ASSISTANCE.—The Secretary shall 
enter into such agreements as are necessary to permit a 
State that elects the Express Lane option under section 
1902(e)(13) of the Social Security Act to receive data di-
rectly relevant to eligibility determinations and deter-
mining the correct amount of benefits under a State child 
health plan under CHIP or a State plan under Medicaid 
from the following: 
(1) The National Directory of New Hires estab-
lished under section 453(i) of the Social Security 
Act (42 U.S.C. 653(i)). 
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HR 3963 PCS 
(2) Data regarding enrollment in insurance that 
may help to facilitate outreach and enrollment under 
the State Medicaid plan, the State CHIP plan, and 
such other programs as the Secretary may specify. 
(f) EFFECTIVE DATE.—The amendments made by 
this section are effective on January 1, 2008. 
Subtitle B—Reducing Barriers to 
Enrollment 
SEC. 211. VERIFICATION OF DECLARATION OF CITIZENSHIP 
OR NATIONALITY FOR PURPOSES OF ELIGI-
BILITY FOR MEDICAID AND CHIP. 
(a) 
ALTERNATIVE
STATE
PROCESS
FOR 
VERIFICATION OF DECLARATION OF CITIZENSHIP OR NA-
TIONALITY FOR PURPOSES OF ELIGIBILITY FOR MED-
ICAID.— 
(1) ALTERNATIVE
TO
DOCUMENTATION
RE-
QUIREMENT.— 
(A) IN
GENERAL.—Section 1902 (42 
U.S.C. 1396a), as amended by section 203(c), 
is amended— 
(i) in subsection (a)(46)— 
(I) by inserting ‘‘(A)’’ after 
‘‘(46)’’; 
(II) by adding ‘‘and’’ after the 
semicolon; and 
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HR 3963 PCS 
(III) by adding at the end the 
following new subparagraph: 
‘‘(B) provide, with respect to an individual de-
claring to be a citizen or national of the United 
States for purposes of establishing eligibility under 
this title, that the State shall satisfy the require-
ments of— 
‘‘(i) section 1903(x); or 
‘‘(ii) subsection (ee);’’; and 
(ii) by adding at the end the following 
new subsection: 
‘‘(ee)(1) For purposes of subsection (a)(46)(B)(ii), 
the requirements of this subsection with respect to an indi-
vidual declaring to be a citizen or national of the United 
States for purposes of establishing eligibility under this 
title, are, in lieu of requiring the individual to present sat-
isfactory documentary evidence of citizenship or nation-
ality under section 1903(x) (if the individual is not de-
scribed in paragraph (2) of that section), as follows: 
‘‘(A) The State submits the name and social se-
curity number of the individual to the Commissioner 
of Social Security as part of the program established 
under paragraph (2). 
‘‘(B) If the State receives notice from the Com-
missioner of Social Security that the name or social 
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132 
HR 3963 PCS 
security number, or the declaration of citizenship or 
nationality, of the individual is inconsistent with in-
formation in the records maintained by the Commis-
sioner— 
‘‘(i) the State makes a reasonable effort to 
identify and address the causes of such incon-
sistency, including through typographical or 
other clerical errors, by contacting the indi-
vidual to confirm the accuracy of the name or 
social security number submitted or declaration 
of citizenship or nationality and by taking such 
additional actions as the Secretary, through 
regulation or other guidance, or the State may 
identify, and continues to provide the individual 
with medical assistance while making such ef-
fort; and 
‘‘(ii) in the case such inconsistency is not 
resolved under clause (i), the State— 
‘‘(I) notifies the individual of such 
fact; 
‘‘(II) provides the individual with a 
period of 90 days from the date on which 
the notice required under subclause (I) is 
received by the individual to either present 
satisfactory documentary evidence of citi-
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133 
HR 3963 PCS 
zenship or nationality (as defined in sec-
tion 1903(x)(3)) or resolve the inconsist-
ency with the Commissioner of Social Se-
curity (and continues to provide the indi-
vidual with medical assistance during such 
90-day period); and 
‘‘(III) disenrolls the individual from 
the State plan under this title within 30 
days after the end of such 90-day period if 
no such documentary evidence is presented 
or if such inconsistency is not resolved. 
‘‘(2)(A) Each State electing to satisfy the require-
ments of this subsection for purposes of section 
1902(a)(46)(B) shall establish a program under which the 
State submits at least monthly to the Commissioner of So-
cial Security for comparison of the name and social secu-
rity number, of each individual newly enrolled in the State 
plan under this title that month who is not described in 
section 1903(x)(2) and who declares to be a United States 
citizen or national, with information in records maintained 
by the Commissioner. 
‘‘(B) In establishing the State program under this 
paragraph, the State may enter into an agreement with 
the Commissioner of Social Security— 
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HR 3963 PCS 
‘‘(i) to provide, through an on-line system or 
otherwise, for the electronic submission of, and re-
sponse to, the information submitted under subpara-
graph (A) for an individual enrolled in the State 
plan under this title who declares to be citizen or na-
tional on at least a monthly basis; or 
‘‘(ii) to provide for a determination of the con-
sistency of the information submitted with the infor-
mation maintained in the records of the Commis-
sioner through such other method as agreed to by 
the State and the Commissioner and approved by 
the Secretary, provided that such method is no more 
burdensome for individuals to comply with than any 
burdens that may apply under a method described in 
clause (i). 
‘‘(C) The program established under this paragraph 
shall provide that, in the case of any individual who is 
required to submit a social security number to the State 
under subparagraph (A) and who is unable to provide the 
State with such number, shall be provided with at least 
the reasonable opportunity to present satisfactory docu-
mentary evidence of citizenship or nationality (as defined 
in section 1903(x)(3)) as is provided under clauses (i) and 
(ii) of section 1137(d)(4)(A) to an individual for the sub-
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135 
HR 3963 PCS 
mittal to the State of evidence indicating a satisfactory 
immigration status. 
‘‘(3)(A) The State agency implementing the plan ap-
proved under this title shall, at such times and in such 
form as the Secretary may specify, provide information on 
the percentage each month that the inconsistent submis-
sions bears to the total submissions made for comparison 
for such month. For purposes of this subparagraph, a 
name, social security number, or declaration of citizenship 
or nationality of an individual shall be treated as incon-
sistent and included in the determination of such percent-
age only if— 
‘‘(i) the information submitted by the individual 
is not consistent with information in records main-
tained by the Commissioner of Social Security; 
‘‘(ii) the inconsistency is not resolved by the 
State; 
‘‘(iii) the individual was provided with a reason-
able period of time to resolve the inconsistency with 
the Commissioner of Social Security or provide satis-
factory documentation of citizenship status and did 
not successfully resolve such inconsistency; and 
‘‘(iv) payment has been made for an item or 
service furnished to the individual under this title. 
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136 
HR 3963 PCS 
‘‘(B) If, for any fiscal year, the average monthly per-
centage determined under subparagraph (A) is greater 
than 3 percent— 
‘‘(i) the State shall develop and adopt a correc-
tive plan to review its procedures for verifying the 
identities of individuals seeking to enroll in the State 
plan under this title and to identify and implement 
changes in such procedures to improve their accu-
racy; and 
‘‘(ii) pay to the Secretary an amount equal to 
the amount which bears the same ratio to the total 
payments under the State plan for the fiscal year for 
providing medical assistance to individuals who pro-
vided inconsistent information as the number of in-
dividuals with inconsistent information in excess of 
3 percent of such total submitted bears to the total 
number of individuals with inconsistent information. 
‘‘(C) The Secretary may waive, in certain limited 
cases, all or part of the payment under subparagraph 
(B)(ii) if the State is unable to reach the allowable error 
rate despite a good faith effort by such State. 
‘‘(D) Subparagraphs (A) and (B) shall not apply to 
a State for a fiscal year if there is an agreement described 
in paragraph (2)(B) in effect as of the close of the fiscal 
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137 
HR 3963 PCS 
year that provides for the submission on a real-time basis 
of the information described in such paragraph. 
‘‘(4) Nothing in this subsection shall affect the rights 
of any individual under this title to appeal any 
disenrollment from a State plan.’’. 
(B) COSTS OF IMPLEMENTING AND MAIN-
TAINING
SYSTEM.—Section 
1903(a)(3) 
(42 
U.S.C. 1396b(a)(3)) is amended— 
(i) by striking ‘‘plus’’ at the end of 
subparagraph (E) and inserting ‘‘and’’, 
and 
(ii) by adding at the end the following 
new subparagraph: 
‘‘(F)(i) 90 percent of the sums expended 
during the quarter as are attributable to the de-
sign, development, or installation of such 
mechanized verification and information re-
trieval systems as the Secretary determines are 
necessary to implement section 1902(ee) (in-
cluding a system described in paragraph (2)(B) 
thereof), and 
‘‘(ii) 75 percent of the sums expended dur-
ing the quarter as are attributable to the oper-
ation of systems to which clause (i) applies, 
plus’’. 
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138 
HR 3963 PCS 
(2) LIMITATION ON WAIVER AUTHORITY.—Not-
withstanding any provision of section 1115 of the 
Social Security Act (42 U.S.C. 1315), or any other 
provision of law, the Secretary may not waive the re-
quirements of section 1902(a)(46)(B) of such Act 
(42 U.S.C. 1396a(a)(46)(B)) with respect to a 
State. 
(3) CONFORMING AMENDMENTS.—Section 1903 
(42 U.S.C. 1396b) is amended— 
(A) in subsection (i)(22), by striking ‘‘sub-
section 
(x)’’ 
and 
inserting 
‘‘section 
1902(a)(46)(B)’’; and 
(B) in subsection (x)(1), by striking ‘‘sub-
section 
(i)(22)’’ 
and 
inserting 
‘‘section 
1902(a)(46)(B)(i)’’. 
(4) APPROPRIATION.—Out of any money in the 
Treasury of the United States not otherwise appro-
priated, there are appropriated to the Commissioner 
of Social Security $5,000,000 to remain available 
until expended to carry out the Commissioner’s re-
sponsibilities under section 1902(ee) of the Social 
Security Act, as added by subsection (a). 
(b) CLARIFICATION OF REQUIREMENTS RELATING 
TO PRESENTATION
OF SATISFACTORY DOCUMENTARY 
EVIDENCE OF CITIZENSHIP OR NATIONALITY.— 
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139 
HR 3963 PCS 
(1) ACCEPTANCE OF DOCUMENTARY EVIDENCE 
ISSUED
BY
A
FEDERALLY
RECOGNIZED
INDIAN 
TRIBE.—Section 
1903(x)(3)(B) 
(42 
U.S.C. 
1396b(x)(3)(B)) is amended— 
(A) by redesignating clause (v) as clause 
(vi); and 
(B) by inserting after clause (iv), the fol-
lowing new clause: 
‘‘(v)(I) Except as provided in subclause (II), a 
document issued by a federally recognized Indian 
tribe evidencing membership or enrollment in, or af-
filiation with, such tribe (such as a tribal enrollment 
card or certificate of degree of Indian blood). 
‘‘(II) With respect to those federally recognized 
Indian tribes located within States having an inter-
national border whose membership includes individ-
uals who are not citizens of the United States, the 
Secretary shall, after consulting with such tribes, 
issue regulations authorizing the presentation of 
such other forms of documentation (including tribal 
documentation, if appropriate) that the Secretary 
determines to be satisfactory documentary evidence 
of citizenship or nationality for purposes of satis-
fying the requirement of this subsection.’’. 
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140 
HR 3963 PCS 
(2) REQUIREMENT
TO
PROVIDE
REASONABLE 
OPPORTUNITY
TO
PRESENT
SATISFACTORY
DOCU-
MENTARY EVIDENCE.—Section 1903(x) (42 U.S.C. 
1396b(x)) is amended by adding at the end the fol-
lowing new paragraph: 
‘‘(4) In the case of an individual declaring to be a 
citizen or national of the United States with respect to 
whom a State requires the presentation of satisfactory 
documentary evidence of citizenship or nationality under 
section 1902(a)(46)(B)(i), the individual shall be provided 
at least the reasonable opportunity to present satisfactory 
documentary evidence of citizenship or nationality under 
this subsection as is provided under clauses (i) and (ii) 
of section 1137(d)(4)(A) to an individual for the submittal 
to the State of evidence indicating a satisfactory immigra-
tion status.’’. 
(3) CHILDREN BORN IN THE UNITED STATES 
TO MOTHERS ELIGIBLE FOR MEDICAID.— 
(A) CLARIFICATION
OF
RULES.—Section 
1903(x) (42 U.S.C. 1396b(x)), as amended by 
paragraph (2), is amended— 
(i) in paragraph (2)— 
(I) in subparagraph (C), by strik-
ing ‘‘or’’ at the end; 
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141 
HR 3963 PCS 
(II) by redesignating subpara-
graph (D) as subparagraph (E); and 
(III) by inserting after subpara-
graph (C) the following new subpara-
graph: 
‘‘(D) pursuant to the application of section 
1902(e)(4) (and, in the case of an individual who is 
eligible for medical assistance on such basis, the in-
dividual shall be deemed to have provided satisfac-
tory documentary evidence of citizenship or nation-
ality and shall not be required to provide further 
documentary evidence on any date that occurs dur-
ing or after the period in which the individual is eli-
gible for medical assistance on such basis); or’’; and 
(ii) by adding at the end the following 
new paragraph: 
‘‘(5) Nothing in subparagraph (A) or (B) of section 
1902(a)(46), the preceding paragraphs of this subsection, 
or the Deficit Reduction Act of 2005, including section 
6036 of such Act, shall be construed as changing the re-
quirement of section 1902(e)(4) that a child born in the 
United States to an alien mother for whom medical assist-
ance for the delivery of such child is available as treatment 
of an emergency medical condition pursuant to subsection 
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142 
HR 3963 PCS 
(v) shall be deemed eligible for medical assistance during 
the first year of such child’s life.’’. 
(B) STATE REQUIREMENT TO ISSUE SEPA-
RATE
IDENTIFICATION
NUMBER.—Section 
1902(e)(4) (42 U.S.C. 1396a(e)(4)) is amended 
by adding at the end the following new sen-
tence: ‘‘Notwithstanding the preceding sentence, 
in the case of a child who is born in the United 
States to an alien mother for whom medical as-
sistance for the delivery of the child is made 
available pursuant to section 1903(v), the State 
immediately shall issue a separate identification 
number for the child upon notification by the 
facility at which such delivery occurred of the 
child’s birth.’’. 
(4) 
TECHNICAL
AMENDMENTS.—Section 
1903(x)(2) (42 U.S.C. 1396b(x)) is amended— 
(A) in subparagraph (B)— 
(i) by realigning the left margin of the 
matter preceding clause (i) 2 ems to the 
left; and 
(ii) by realigning the left margins of 
clauses (i) and (ii), respectively, 2 ems to 
the left; and 
(B) in subparagraph (C)— 
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143 
HR 3963 PCS 
(i) by realigning the left margin of the 
matter preceding clause (i) 2 ems to the 
left; and 
(ii) by realigning the left margins of 
clauses (i) and (ii), respectively, 2 ems to 
the left. 
(c) APPLICATION OF DOCUMENTATION SYSTEM TO 
CHIP.— 
(1) IN GENERAL.—Section 2105(c) (42 U.S.C. 
1397ee(c)), as amended by sections 114(a) and 
116(c), is amended by adding at the end the fol-
lowing new paragraph: 
‘‘(10) CITIZENSHIP DOCUMENTATION REQUIRE-
MENTS.— 
‘‘(A) IN GENERAL.—No payment may be 
made under this section with respect to an indi-
vidual who has, or is, declared to be a citizen 
or national of the United States for purposes of 
establishing eligibility under this title unless the 
State meets the requirements of section 
1902(a)(46)(B) with respect to the individual. 
‘‘(B) ENHANCED
PAYMENTS.—Notwith-
standing subsection (b), the enhanced FMAP 
with respect to payments under subsection (a) 
for expenditures described in clause (i) or (ii) of 
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145 
HR 3963 PCS 
the Deficit Reduction Act of 2005 (Public 
Law 109–171; 120 Stat. 80); and 
(ii) paragraph (4) of subsection (b) 
shall take effect as if included in the enact-
ment of section 405 of division B of the 
Tax Relief and Health Care Act of 2006 
(Public Law 109–432; 120 Stat. 2996). 
(2) RESTORATION
OF
ELIGIBILITY.—In the 
case of an individual who, during the period that 
began on July 1, 2006, and ends on October 1, 
2008, was determined to be ineligible for medical as-
sistance under a State Medicaid plan, including any 
waiver of such plan, solely as a result of the applica-
tion of subsections (i)(22) and (x) of section 1903 
of the Social Security Act (as in effect during such 
period), but who would have been determined eligible 
for such assistance if such subsections, as amended 
by subsection (b), had applied to the individual, a 
State may deem the individual to be eligible for such 
assistance as of the date that the individual was de-
termined to be ineligible for such medical assistance 
on such basis. 
(3) SPECIAL TRANSITION RULE FOR INDIANS.— 
During the period that begins on July 1, 2006, and 
ends on the effective date of final regulations issued 
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146 
HR 3963 PCS 
under subclause (II) of section 1903(x)(3)(B)(v) of 
the 
Social 
Security 
Act 
(42 
U.S.C. 
1396b(x)(3)(B)(v)) 
(as 
added 
by 
subsection 
(b)(1)(B)), an individual who is a member of a fed-
erally-recognized Indian tribe described in subclause 
(II) of that section who presents a document de-
scribed in subclause (I) of such section that is issued 
by such Indian tribe, shall be deemed to have pre-
sented satisfactory evidence of citizenship or nation-
ality for purposes of satisfying the requirement of 
subsection (x) of section 1903 of such Act. 
SEC. 212. REDUCING ADMINISTRATIVE BARRIERS TO EN-
ROLLMENT. 
Section 2102(b) (42 U.S.C. 1397bb(b)) is amended— 
(1) by redesignating paragraph (4) as para-
graph (5); and 
(2) by inserting after paragraph (3) the fol-
lowing new paragraph: 
‘‘(4) REDUCTION
OF
ADMINISTRATIVE
BAR-
RIERS TO ENROLLMENT.— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), the plan shall include a description 
of the procedures used to reduce administrative 
barriers to the enrollment of children and preg-
nant women who are eligible for medical assist-
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HR 3963 PCS 
ance under title XIX or for child health assist-
ance or health benefits coverage under this title. 
Such procedures shall be established and re-
vised as often as the State determines appro-
priate to take into account the most recent in-
formation available to the State identifying 
such barriers. 
‘‘(B) DEEMED COMPLIANCE IF JOINT AP-
PLICATION AND RENEWAL PROCESS THAT PER-
MITS APPLICATION OTHER THAN IN PERSON.— 
A State shall be deemed to comply with sub-
paragraph (A) if the State’s application and re-
newal forms and supplemental forms (if any) 
and information verification process is the same 
for purposes of establishing and renewing eligi-
bility for children and pregnant women for 
medical assistance under title XIX and child 
health assistance under this title, and such 
process does not require an application to be 
made in person or a face-to-face interview.’’. 
SEC. 213. MODEL OF INTERSTATE COORDINATED ENROLL-
MENT AND COVERAGE PROCESS. 
(a) IN GENERAL.—In order to assure continuity of 
coverage of low-income children under the Medicaid pro-
gram and the State Children’s Health Insurance Program 
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(CHIP), not later than 18 months after the date of the 
enactment of this Act, the Secretary of Health and 
Human Services, in consultation with State Medicaid and 
CHIP directors and organizations representing program 
beneficiaries, shall develop a model process for the coordi-
nation of the enrollment, retention, and coverage under 
such programs of children who, because of migration of 
families, emergency evacuations, natural or other disas-
ters, public health emergencies, educational needs, or oth-
erwise, frequently change their State of residency or other-
wise are temporarily located outside of the State of their 
residency. 
(b) REPORT TO CONGRESS.—After development of 
such model process, the Secretary of Health and Human 
Services shall submit to Congress a report describing addi-
tional steps or authority needed to make further improve-
ments to coordinate the enrollment, retention, and cov-
erage under CHIP and Medicaid of children described in 
subsection (a). 
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TITLE III—REDUCING BARRIERS 
TO PROVIDING PREMIUM AS-
SISTANCE 
Subtitle A—Additional State Op-
tion for Providing Premium As-
sistance 
SEC. 301. ADDITIONAL STATE OPTION FOR PROVIDING 
PREMIUM ASSISTANCE. 
(a) CHIP.— 
(1) IN GENERAL.—Section 2105(c) (42 U.S.C. 
1397ee(c)), as amended by sections 114(a), 116(c), 
and 211(c), is amended by adding at the end the fol-
lowing: 
‘‘(11) STATE OPTION TO OFFER PREMIUM AS-
SISTANCE.— 
‘‘(A) IN GENERAL.—A State may elect to 
offer a premium assistance subsidy (as defined 
in subparagraph (C)) for qualified employer- 
sponsored coverage (as defined in subparagraph 
(B)) to all targeted low-income children who are 
eligible for child health assistance under the 
plan and have access to such coverage in ac-
cordance with the requirements of this para-
graph. No subsidy shall be provided to a tar-
geted low-income child under this paragraph 
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unless the child (or the child’s parent) volun-
tarily elects to receive such a subsidy. A State 
may not require such an election as a condition 
of receipt of child health assistance. 
‘‘(B) QUALIFIED
EMPLOYER-SPONSORED 
COVERAGE.— 
‘‘(i) IN GENERAL.—Subject to clause 
(ii), in this paragraph, the term ‘qualified 
employer-sponsored coverage’ means a 
group health plan or health insurance cov-
erage offered through an employer— 
‘‘(I) that qualifies as creditable 
coverage as a group health plan under 
section 2701(c)(1) of the Public 
Health Service Act; 
‘‘(II) for which the employer con-
tribution toward any premium for 
such coverage is at least 40 percent; 
and 
‘‘(III) that is offered to all indi-
viduals in a manner that would be 
considered a nondiscriminatory eligi-
bility classification for purposes of 
paragraph (3)(A)(ii) of section 105(h) 
of the Internal Revenue Code of 1986 
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(but determined without regard to 
clause (i) of subparagraph (B) of such 
paragraph). 
‘‘(ii) EXCEPTION.—Such term does 
not include coverage consisting of— 
‘‘(I) benefits provided under a 
health flexible spending arrangement 
(as defined in section 106(c)(2) of the 
Internal Revenue Code of 1986); or 
‘‘(II) a high deductible health 
plan (as defined in section 223(c)(2) 
of such Code), without regard to 
whether the plan is purchased in con-
junction with a health savings account 
(as defined under section 223(d) of 
such Code). 
‘‘(C) PREMIUM ASSISTANCE SUBSIDY.— 
‘‘(i) IN GENERAL.—In this paragraph, 
the term ‘premium assistance subsidy’ 
means, with respect to a targeted low-in-
come child, the amount equal to the dif-
ference between the employee contribution 
required for enrollment only of the em-
ployee under qualified employer-sponsored 
coverage and the employee contribution re-
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quired for enrollment of the employee and 
the child in such coverage, less any appli-
cable premium cost-sharing applied under 
the State child health plan (subject to the 
limitations imposed under section 2103(e), 
including the requirement to count the 
total amount of the employee contribution 
required for enrollment of the employee 
and the child in such coverage toward the 
annual aggregate cost-sharing limit applied 
under paragraph (3)(B) of such section). 
‘‘(ii) STATE
PAYMENT
OPTION.—A 
State may provide a premium assistance 
subsidy either as reimbursement to an em-
ployee for out-of-pocket expenditures or, 
subject to clause (iii), directly to the em-
ployee’s employer. 
‘‘(iii) EMPLOYER OPT-OUT.—An em-
ployer may notify a State that it elects to 
opt-out of being directly paid a premium 
assistance subsidy on behalf of an em-
ployee. In the event of such a notification, 
an employer shall withhold the total 
amount of the employee contribution re-
quired for enrollment of the employee and 
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HR 3963 PCS 
the child in the qualified employer-spon-
sored coverage and the State shall pay the 
premium assistance subsidy directly to the 
employee. 
‘‘(iv) TREATMENT AS CHILD HEALTH 
ASSISTANCE.—Expenditures for the provi-
sion of premium assistance subsidies shall 
be considered child health assistance de-
scribed in paragraph (1)(C) of subsection 
(a) for purposes of making payments 
under that subsection. 
‘‘(D) APPLICATION OF SECONDARY PAYOR 
RULES.—The State shall be a secondary payor 
for any items or services provided under the 
qualified employer-sponsored coverage for which 
the State provides child health assistance under 
the State child health plan. 
‘‘(E) REQUIREMENT TO PROVIDE SUPPLE-
MENTAL COVERAGE FOR BENEFITS AND COST- 
SHARING PROTECTION PROVIDED UNDER THE 
STATE CHILD HEALTH PLAN.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
section 2110(b)(1)(C), the State shall pro-
vide for each targeted low-income child en-
rolled in qualified employer-sponsored cov-
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erage, supplemental coverage consisting 
of— 
‘‘(I) items or services that are 
not covered, or are only partially cov-
ered, under the qualified employer- 
sponsored coverage; and 
‘‘(II) cost-sharing protection con-
sistent with section 2103(e). 
‘‘(ii) RECORD
KEEPING
REQUIRE-
MENTS.—For purposes of carrying out 
clause (i), a State may elect to directly pay 
out-of-pocket expenditures for cost-sharing 
imposed under the qualified employer-spon-
sored coverage and collect or not collect all 
or any portion of such expenditures from 
the parent of the child. 
‘‘(F) APPLICATION
OF
WAITING
PERIOD 
IMPOSED UNDER THE STATE.—Any waiting pe-
riod imposed under the State child health plan 
prior to the provision of child health assistance 
to a targeted low-income child under the State 
plan shall apply to the same extent to the provi-
sion of a premium assistance subsidy for the 
child under this paragraph. 
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HR 3963 PCS 
‘‘(G) 
OPT-OUT
PERMITTED
FOR
ANY 
MONTH.—A State shall establish a process for 
permitting the parent of a targeted low-income 
child receiving a premium assistance subsidy to 
disenroll the child from the qualified employer- 
sponsored coverage and enroll the child in, and 
receive child health assistance under, the State 
child health plan, effective on the first day of 
any month for which the child is eligible for 
such assistance and in a manner that ensures 
continuity of coverage for the child. 
‘‘(H) APPLICATION
TO
PARENTS.—If a 
State provides child health assistance or health 
benefits coverage to parents of a targeted low- 
income 
child 
in 
accordance 
with 
section 
2111(b), the State may elect to offer a pre-
mium assistance subsidy to a parent of a tar-
geted low-income child who is eligible for such 
a subsidy under this paragraph in the same 
manner as the State offers such a subsidy for 
the enrollment of the child in qualified em-
ployer-sponsored coverage, except that— 
‘‘(i) the amount of the premium as-
sistance subsidy shall be increased to take 
into account the cost of the enrollment of 
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HR 3963 PCS 
the parent in the qualified employer-spon-
sored coverage or, at the option of the 
State if the State determines it cost-effec-
tive, the cost of the enrollment of the 
child’s family in such coverage; and 
‘‘(ii) any reference in this paragraph 
to a child is deemed to include a reference 
to the parent or, if applicable under clause 
(i), the family of the child. 
‘‘(I) ADDITIONAL STATE OPTION FOR PRO-
VIDING PREMIUM ASSISTANCE.— 
‘‘(i) IN GENERAL.—A State may es-
tablish an employer-family premium assist-
ance purchasing pool for employers with 
less than 250 employees who have at least 
1 employee who is a pregnant woman eligi-
ble for assistance under the State child 
health plan (including through the applica-
tion of an option described in section 
2112(f)) or a member of a family with at 
least 1 targeted low-income child and to 
provide a premium assistance subsidy 
under this paragraph for enrollment in 
coverage made available through such pool. 
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HR 3963 PCS 
‘‘(ii) ACCESS
TO
CHOICE
OF
COV-
ERAGE.—A State that elects the option 
under clause (i) shall identify and offer ac-
cess to not less than 2 private health plans 
that are health benefits coverage that is 
equivalent to the benefits coverage in a 
benchmark benefit package described in 
section 2103(b) or benchmark-equivalent 
coverage that meets the requirements of 
section 2103(a)(2) for employees described 
in clause (i). 
‘‘(iii) CLARIFICATION
OF
PAYMENT 
FOR
ADMINISTRATIVE
EXPENDITURES.— 
Nothing in this subparagraph shall be con-
strued as permitting payment under this 
section for administrative expenditures at-
tributable to the establishment or oper-
ation of such pool, except to the extent 
that such payment would otherwise be per-
mitted under this title. 
‘‘(J) NO EFFECT ON PREMIUM ASSISTANCE 
WAIVER
PROGRAMS.—Nothing in this para-
graph shall be construed as limiting the author-
ity of a State to offer premium assistance under 
section 1906 or 1906A, a waiver described in 
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paragraph (2)(B) or (3), a waiver approved 
under section 1115, or other authority in effect 
prior to the date of enactment of the Children’s 
Health Insurance Program Reauthorization Act 
of 2007. 
‘‘(K) NOTICE
OF
AVAILABILITY.—If a 
State elects to provide premium assistance sub-
sidies in accordance with this paragraph, the 
State shall— 
‘‘(i) include on any application or en-
rollment form for child health assistance a 
notice of the availability of premium assist-
ance subsidies for the enrollment of tar-
geted low-income children in qualified em-
ployer-sponsored coverage; 
‘‘(ii) provide, as part of the applica-
tion and enrollment process under the 
State child health plan, information de-
scribing the availability of such subsidies 
and how to elect to obtain such a subsidy; 
and 
‘‘(iii) establish such other procedures 
as the State determines necessary to en-
sure that parents are fully informed of the 
choices for receiving child health assistance 
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HR 3963 PCS 
under the State child health plan or 
through the receipt of premium assistance 
subsidies. 
‘‘(L) APPLICATION
TO
QUALIFIED
EM-
PLOYER-SPONSORED BENCHMARK COVERAGE.— 
If a group health plan or health insurance cov-
erage offered through an employer is certified 
by an actuary as health benefits coverage that 
is equivalent to the benefits coverage in a 
benchmark benefit package described in section 
2103(b) or benchmark-equivalent coverage that 
meets the requirements of section 2103(a)(2), 
the State may provide premium assistance sub-
sidies for enrollment of targeted low-income 
children in such group health plan or health in-
surance coverage in the same manner as such 
subsidies are provided under this paragraph for 
enrollment in qualified employer-sponsored cov-
erage, but without regard to the requirement to 
provide supplemental coverage for benefits and 
cost-sharing protection provided under the 
State child health plan under subparagraph 
(E). 
‘‘(M) SATISFACTION OF COST-EFFECTIVE-
NESS TEST.—Premium assistance subsidies for 
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qualified employer-sponsored coverage offered 
under this paragraph shall be deemed to meet 
the requirement of subparagraph (A) of para-
graph (3). 
‘‘(N) COORDINATION WITH MEDICAID.—In 
the case of a targeted low-income child who re-
ceives child health assistance through a State 
plan under title XIX and who voluntarily elects 
to receive a premium assistance subsidy under 
this section, the provisions of section 1906A 
shall apply and shall supersede any other provi-
sions of this paragraph that are inconsistent 
with such section.’’. 
(2) DETERMINATION OF COST-EFFECTIVENESS 
FOR PREMIUM ASSISTANCE OR PURCHASE OF FAM-
ILY COVERAGE.— 
(A) IN GENERAL.—Section 2105(c)(3)(A) 
(42 U.S.C. 1397ee(c)(3)(A)) is amended by 
striking ‘‘relative to’’ and all that follows 
through the comma and inserting ‘‘relative to 
‘‘(i) the amount of expenditures under 
the State child health plan, including ad-
ministrative expenditures, that the State 
would have made to provide comparable 
coverage of the targeted low-income child 
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involved or the family involved (as applica-
ble); or 
‘‘(ii) the aggregate amount of expendi-
tures that the State would have made 
under the State child health plan, includ-
ing administrative expenditures, for pro-
viding coverage under such plan for all 
such children or families.’’. 
(B) NONAPPLICATION TO PREVIOUSLY AP-
PROVED COVERAGE.—The amendment made by 
subparagraph (A) shall not apply to coverage 
the purchase of which has been approved by the 
Secretary under section 2105(c)(3) of the Social 
Security Act prior to the date of enactment of 
this Act. 
(b) MEDICAID.—Title XIX is amended by inserting 
after section 1906 the following new section: 
‘‘PREMIUM ASSISTANCE OPTION FOR CHILDREN 
‘‘SEC. 1906A. (a) IN GENERAL.—A State may elect 
to offer a premium assistance subsidy (as defined in sub-
section (c)) for qualified employer-sponsored coverage (as 
defined in subsection (b)) to all individuals under age 19 
who are entitled to medical assistance under this title (and 
to the parent of such an individual) who have access to 
such coverage if the State meets the requirements of this 
section. 
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‘‘(b) 
QUALIFIED
EMPLOYER-SPONSORED
COV-
ERAGE.— 
‘‘(1) IN GENERAL.—Subject to paragraph (2)), 
in this paragraph, the term ‘qualified employer-spon-
sored coverage’ means a group health plan or health 
insurance coverage offered through an employer— 
‘‘(A) that qualifies as creditable coverage 
as a group health plan under section 2701(c)(1) 
of the Public Health Service Act; 
‘‘(B) for which the employer contribution 
toward any premium for such coverage is at 
least 40 percent; and 
‘‘(C) that is offered to all individuals in a 
manner that would be considered a nondiscrim-
inatory eligibility classification for purposes of 
paragraph (3)(A)(ii) of section 105(h) of the 
Internal Revenue Code of 1986 (but determined 
without regard to clause (i) of subparagraph 
(B) of such paragraph). 
‘‘(2) EXCEPTION.—Such term does not include 
coverage consisting of— 
‘‘(A) benefits provided under a health flexi-
ble spending arrangement (as defined in section 
106(c)(2) of the Internal Revenue Code of 
1986); or 
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‘‘(B) a high deductible health plan (as de-
fined in section 223(c)(2) of such Code), with-
out regard to whether the plan is purchased in 
conjunction with a health savings account (as 
defined under section 223(d) of such Code). 
‘‘(3) TREATMENT
AS
THIRD
PARTY
LIABIL-
ITY.—The State shall treat the coverage provided 
under qualified employer-sponsored coverage as a 
third party liability under section 1902(a)(25). 
‘‘(c) PREMIUM ASSISTANCE SUBSIDY.—In this sec-
tion, the term ‘premium assistance subsidy’ means the 
amount of the employee contribution for enrollment in the 
qualified employer-sponsored coverage by the individual 
under age 19 or by the individual’s family. Premium as-
sistance subsidies under this section shall be considered, 
for purposes of section 1903(a), to be a payment for med-
ical assistance. 
‘‘(d) VOLUNTARY PARTICIPATION.— 
‘‘(1) EMPLOYERS.—Participation by an em-
ployer in a premium assistance subsidy offered by a 
State under this section shall be voluntary. An em-
ployer may notify a State that it elects to opt-out of 
being directly paid a premium assistance subsidy on 
behalf of an employee. 
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‘‘(2) BENEFICIARIES.—No subsidy shall be pro-
vided to an individual under age 19 under this sec-
tion unless the individual (or the individual’s parent) 
voluntarily elects to receive such a subsidy. A State 
may not require such an election as a condition of 
receipt of medical assistance. State may not require, 
as a condition of an individual under age 19 (or the 
individual’s parent) being or remaining eligible for 
medical assistance under this title, apply for enroll-
ment in qualified employer-sponsored coverage under 
this section. 
‘‘(3) OPT-OUT PERMITTED FOR ANY MONTH.— 
A State shall establish a process for permitting the 
parent of an individual under age 19 receiving a pre-
mium assistance subsidy to disenroll the individual 
from the qualified employer-sponsored coverage. 
‘‘(e) REQUIREMENT TO PAY PREMIUMS AND COST- 
SHARING AND PROVIDE SUPPLEMENTAL COVERAGE.—In 
the case of the participation of an individual under age 
19 (or the individual’s parent) in a premium assistance 
subsidy under this section for qualified employer-spon-
sored coverage, the State shall provide for payment of all 
enrollee premiums for enrollment in such coverage and all 
deductibles, coinsurance, and other cost-sharing obliga-
tions for items and services otherwise covered under the 
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State plan under this title (exceeding the amount other-
wise permitted under section 1916 or, if applicable, section 
1916A). The fact that an individual under age 19 (or a 
parent) elects to enroll in qualified employer-sponsored 
coverage under this section shall not change the individ-
ual’s (or parent’s) eligibility for medical assistance under 
the State plan, except insofar as section 1902(a)(25) pro-
vides that payments for such assistance shall first be made 
under such coverage.’’. 
(c) GAO STUDY AND REPORT.—Not later than Janu-
ary 1, 2009, the Comptroller General of the United States 
shall study cost and coverage issues relating to any State 
premium assistance programs for which Federal matching 
payments are made under title XIX or XXI of the Social 
Security Act, including under waiver authority, and shall 
submit a report to the Committee on Finance of the Sen-
ate and the Committee on Energy and Commerce of the 
House of Representatives on the results of such study. 
SEC. 302. OUTREACH, EDUCATION, AND ENROLLMENT AS-
SISTANCE. 
(a) REQUIREMENT TO INCLUDE DESCRIPTION OF 
OUTREACH, EDUCATION, AND ENROLLMENT EFFORTS 
RELATED TO PREMIUM ASSISTANCE SUBSIDIES IN STATE 
CHILD HEALTH PLAN.—Section 2102(c) (42 U.S.C. 
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1397bb(c)) is amended by adding at the end the following 
new paragraph: 
‘‘(3) PREMIUM ASSISTANCE SUBSIDIES.—In the 
case of a State that provides for premium assistance 
subsidies under the State child health plan in ac-
cordance with paragraph (2)(B), (3), or (10) of sec-
tion 2105(c), or a waiver approved under section 
1115, outreach, education, and enrollment assistance 
for families of children likely to be eligible for such 
subsidies, to inform such families of the availability 
of, and to assist them in enrolling their children in, 
such subsidies, and for employers likely to provide 
coverage that is eligible for such subsidies, including 
the specific, significant resources the State intends 
to apply to educate employers about the availability 
of premium assistance subsidies under the State 
child health plan.’’. 
(b) NONAPPLICATION
OF 10 PERCENT LIMIT
ON 
OUTREACH AND CERTAIN OTHER EXPENDITURES.—Sec-
tion 2105(c)(2)(C) (42 U.S.C. 1397ee(c)(2)(C)), as 
amended by section 301(c)(2), is amended by adding at 
the end the following new clause: 
‘‘(iv) EXPENDITURES FOR OUTREACH 
TO INCREASE THE ENROLLMENT OF CHIL-
DREN UNDER THIS TITLE AND TITLE xix 
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THROUGH
PREMIUM
ASSISTANCE
SUB-
SIDIES.—Expenditures for outreach activi-
ties to families of children likely to be eligi-
ble for premium assistance subsidies in ac-
cordance with paragraph (2)(B), (3), or 
(10), or a waiver approved under section 
1115, to inform such families of the avail-
ability of, and to assist them in enrolling 
their children in, such subsidies, and to 
employers likely to provide qualified em-
ployer-sponsored coverage (as defined in 
subparagraph (B) of such paragraph), but 
not to exceed an amount equal to 1.25 per-
cent of the maximum amount permitted to 
be expended under subparagraph (A) for 
items described in subsection (a)(1)(D).’’. 
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Subtitle B—Coordinating Premium 
Assistance With Private Coverage 
SEC. 311. SPECIAL ENROLLMENT PERIOD UNDER GROUP 
HEALTH PLANS IN CASE OF TERMINATION OF 
MEDICAID OR CHIP COVERAGE OR ELIGI-
BILITY FOR ASSISTANCE IN PURCHASE OF 
EMPLOYMENT-BASED COVERAGE; COORDINA-
TION OF COVERAGE. 
(a) AMENDMENTS TO INTERNAL REVENUE CODE OF 
1986.—Section 9801(f) of the Internal Revenue Code of 
1986 (relating to special enrollment periods) is amended 
by adding at the end the following new paragraph: 
‘‘(3) SPECIAL RULES RELATING TO MEDICAID 
AND CHIP.— 
‘‘(A) IN GENERAL.—A group health plan 
shall permit an employee who is eligible, but 
not enrolled, for coverage under the terms of 
the plan (or a dependent of such an employee 
if the dependent is eligible, but not enrolled, for 
coverage under such terms) to enroll for cov-
erage under the terms of the plan if either of 
the following conditions is met: 
‘‘(i) TERMINATION OF MEDICAID OR 
CHIP
COVERAGE.—The employee or de-
pendent is covered under a Medicaid plan 
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under title XIX of the Social Security Act 
or under a State child health plan under 
title XXI of such Act and coverage of the 
employee or dependent under such a plan 
is terminated as a result of loss of eligi-
bility for such coverage and the employee 
requests coverage under the group health 
plan not later than 60 days after the date 
of termination of such coverage. 
‘‘(ii) ELIGIBILITY FOR EMPLOYMENT 
ASSISTANCE UNDER MEDICAID OR CHIP.— 
The employee or dependent becomes eligi-
ble for assistance, with respect to coverage 
under the group health plan under such 
Medicaid plan or State child health plan 
(including under any waiver or demonstra-
tion project conducted under or in relation 
to such a plan), if the employee requests 
coverage under the group health plan not 
later than 60 days after the date the em-
ployee or dependent is determined to be el-
igible for such assistance. 
‘‘(B) EMPLOYEE OUTREACH AND DISCLO-
SURE.— 
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HR 3963 PCS 
‘‘(i) OUTREACH TO EMPLOYEES RE-
GARDING AVAILABILITY OF MEDICAID AND 
CHIP COVERAGE.— 
‘‘(I) IN
GENERAL.—Each em-
ployer that maintains a group health 
plan in a State that provides medical 
assistance under a State Medicaid 
plan under title XIX of the Social Se-
curity Act, or child health assistance 
under a State child health plan under 
title XXI of such Act, in the form of 
premium assistance for the purchase 
of coverage under a group health 
plan, shall provide to each employee a 
written notice informing the employee 
of potential opportunities then cur-
rently available in the State in which 
the employee resides for premium as-
sistance under such plans for health 
coverage of the employee or the em-
ployee’s dependents. For purposes of 
compliance with this clause, the em-
ployer may use any State-specific 
model notice developed in accordance 
with section 701(f)(3)(B)(i)(II) of the 
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HR 3963 PCS 
Employee Retirement Income Security 
Act 
of 
1974 
(29 
U.S.C. 
1181(f)(3)(B)(i)(II)). 
‘‘(II) OPTION TO PROVIDE CON-
CURRENT WITH PROVISION OF PLAN 
MATERIALS
TO
EMPLOYEE.—An em-
ployer may provide the model notice 
applicable to the State in which an 
employee resides concurrent with the 
furnishing of materials notifying the 
employee of health plan eligibility, 
concurrent with materials provided to 
the employee in connection with an 
open season or election process con-
ducted under the plan, or concurrent 
with the furnishing of the summary 
plan description as provided in section 
104(b) of the Employee Retirement 
Income Security Act of 1974 (29 
U.S.C. 1024). 
‘‘(ii) 
DISCLOSURE
ABOUT
GROUP 
HEALTH PLAN BENEFITS TO STATES FOR 
MEDICAID
AND
CHIP
ELIGIBLE
INDIVID-
UALS.—In the case of a participant or ben-
eficiary of a group health plan who is cov-
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HR 3963 PCS 
ered under a Medicaid plan of a State 
under title XIX of the Social Security Act 
or under a State child health plan under 
title XXI of such Act, the plan adminis-
trator of the group health plan shall dis-
close to the State, upon request, informa-
tion about the benefits available under the 
group health plan in sufficient specificity, 
as determined under regulations of the 
Secretary of Health and Human Services 
in consultation with the Secretary that re-
quire use of the model coverage coordina-
tion disclosure form developed under sec-
tion 311(b)(1)(C) of the Children’s Health 
Insurance Program Reauthorization Act of 
2007, so as to permit the State to make a 
determination (under paragraph (2)(B), 
(3), or (10) of section 2105(c) of the So-
cial Security Act or otherwise) concerning 
the cost-effectiveness of the State pro-
viding medical or child health assistance 
through premium assistance for the pur-
chase of coverage under such group health 
plan and in order for the State to provide 
supplemental benefits required under para-
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HR 3963 PCS 
‘‘(2) REQUIREMENTS.—In awarding grants 
under this subsection, the Secretary shall ensure 
that— 
‘‘(A) only 1 demonstration project funded 
under a grant awarded under this subsection 
shall be conducted in a State; and 
‘‘(B) demonstration projects funded under 
grants awarded under this subsection shall be 
conducted evenly between States with large 
urban areas and States with large rural areas. 
‘‘(3) 
AUTHORITY
FOR
MULTISTATE 
PROJECTS.—A demonstration project conducted with 
a grant awarded under this subsection may be con-
ducted on a multistate basis, as needed. 
‘‘(4) FUNDING.—$20,000,000 of the amount 
appropriated under subsection (i) for a fiscal year 
shall be used to carry out this subsection. 
‘‘(e) 
CHILDHOOD
OBESITY
DEMONSTRATION 
PROJECT.— 
‘‘(1) AUTHORITY
TO
CONDUCT
DEMONSTRA-
TION.—The Secretary, in consultation with the Ad-
ministrator of the Centers for Medicare & Medicaid 
Services, shall conduct a demonstration project to 
develop a comprehensive and systematic model for 
reducing childhood obesity by awarding grants to eli-
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HR 3963 PCS 
(2) STATE OPTION TO APPLY PERM DATA.—A 
State may elect, for purposes of determining the er-
roneous excess payments for medical assistance ratio 
applicable to the State for a fiscal year under section 
1903(u) of the Social Security Act (42 U.S.C. 
1396b(u)) to substitute data resulting from the ap-
plication of the PERM requirements to the State 
after the final rule implementing such requirements 
is in effect for all States for data obtained from the 
application of the MEQC requirements to the State 
with respect to a fiscal year. 
(3) STATE OPTION TO APPLY MEQC DATA.—For 
purposes of satisfying the requirements of subpart Q 
of part 431 of title 42, Code of Federal Regulations, 
as in effect on September 1, 2007, relating to Med-
icaid eligibility reviews, a State may elect to sub-
stitute data obtained through MEQC reviews con-
ducted in accordance with section 1903(u) of the So-
cial Security Act (42 U.S.C. 1396b(u)) for data re-
quired for purposes of PERM requirements, but only 
if the State MEQC reviews are based on a broad, 
representative sample of Medicaid applicants or en-
rollees in the States. 
(f) IDENTIFICATION OF IMPROVED STATE-SPECIFIC 
SAMPLE SIZES.—The Secretary shall establish State-spe-
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HR 3963 PCS 
(i) by striking ‘‘Notwithstanding any 
other provision of this title’’ and inserting 
‘‘Notwithstanding section 1902(a)(1) (re-
lating 
to 
statewideness), 
section 
1902(a)(10)(B) (relating to comparability) 
and any other provision of this title which 
would be directly contrary to the authority 
under this section and subject to sub-
section (E)’’; and 
(ii) by striking ‘‘enrollment in cov-
erage that provides’’ and inserting ‘‘cov-
erage that’’; 
(B) in clause (i), by inserting ‘‘provides’’ 
after ‘‘(i)’’; and 
(C) by striking clause (ii) and inserting the 
following: 
‘‘(ii) for any individual described in 
section 1905(a)(4)(B) who is eligible under 
the State plan in accordance with para-
graphs (10) and (17) of section 1902(a), 
consists of the items and services described 
in section 1905(a)(4)(B) (relating to early 
and periodic screening, diagnostic, and 
treatment 
services 
defined 
in 
section 
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253 
HR 3963 PCS 
1905(r)) and provided in accordance with 
the requirements of section 1902(a)(43).’’; 
(2) in subparagraph (C)— 
(A) in the heading, by striking ‘‘WRAP- 
AROUND’’ and inserting ‘‘ADDITIONAL’’; and 
(B) by striking ‘‘wrap-around or’’; and 
(3) by adding at the end the following new sub-
paragraph: 
‘‘(E) RULE OF CONSTRUCTION.—Nothing 
in this paragraph shall be construed as— 
‘‘(i) requiring a State to offer all or 
any of the items and services required by 
subparagraph (A)(ii) through an issuer of 
benchmark coverage described in sub-
section (b)(1) or benchmark equivalent 
coverage described in subsection (b)(2); 
‘‘(ii) preventing a State from offering 
all or any of the items and services re-
quired by subparagraph (A)(ii) through an 
issuer of benchmark coverage described in 
subsection (b)(1) or benchmark equivalent 
coverage described in subsection (b)(2); or 
‘‘(iii) affecting a child’s entitlement to 
care and services described in subsections 
(a)(4)(B) and (r) of section 1905 and pro-
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