I 
111TH CONGRESS 
1ST SESSION 
H. R. 688 
To amend title XXI of the Social Security Act to reauthorize the State 
Children’s Health Insurance Program through fiscal year 2013, and 
for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 26, 2009 
Ms. GRANGER introduced the following bill; which was referred to the 
Committee on Energy and Commerce 
A BILL 
To amend title XXI of the Social Security Act to reauthorize 
the State Children’s Health Insurance Program through 
fiscal year 2013, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Kids First Act’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title; table of contents. 
Sec. 2. Reauthorization through fiscal year 2013. 
Sec. 3. Allotments for the 50 States and the District of Columbia based on ex-
penditures and numbers of low-income children. 
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Sec. 4. Limitations on matching rates for populations other than low-income 
children or pregnant women covered through a section 1115 
waiver. 
Sec. 5. Prohibition on new section 1115 waivers for coverage of adults other 
than pregnant women. 
Sec. 6. Standardization of determination of family income for targeted low-in-
come children under title XXI and optional targeted low-in-
come children under title XIX. 
Sec. 7. Grants for outreach and enrollment. 
Sec. 8. Improved State option for offering premium assistance for coverage of 
children through private plans under SCHIP and Medicaid. 
Sec. 9. Treatment of unborn children. 
Sec. 10. 50 percent matching rate for all Medicaid administrative costs. 
Sec. 11. Reduction in payments for Medicaid administrative costs to prevent 
duplication of such payments under TANF. 
Sec. 12. Elimination of waiver of certain Medicaid provider tax provisions. 
Sec. 13. Elimination of special payments for certain public hospitals. 
Sec. 14. Effective date; coordination of funding for fiscal year 2009. 
SEC. 2. REAUTHORIZATION THROUGH FISCAL YEAR 2013. 
(a) INCREASE IN NATIONAL ALLOTMENT.—Section 
2104 of the Social Security Act (42 U.S.C. 1397dd(a)) 
is amended— 
(1) in subsection (a)— 
(A) by striking ‘‘and’’ at the end of para-
graph (10); 
(B) in paragraph (11)— 
(i) by striking ‘‘each of fiscal years 
2008 and 2009’’ and inserting ‘‘fiscal year 
2008’’; and 
(ii) by striking the period at the end 
and inserting a semicolon; and 
(C) by adding at the end the following new 
paragraphs: 
‘‘(12) for fiscal year 2009, $7,780,000,000; 
‘‘(13) for fiscal year 2010, $8,044,000,000; 
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‘‘(14) for fiscal year 2011, $8,568,000,000; 
‘‘(15) for fiscal year 2012, $9,032,000,000; and 
‘‘(16) for fiscal year 2013, $9,505,000,000.’’; 
and 
(2) in subsection (c)(4)(B), by striking ‘‘2009’’ 
and inserting ‘‘2008, $62,000,000 for fiscal year 
2009, 
$64,000,000 
for 
fiscal 
year 
2010, 
$68,000,000 for fiscal year 2011, $72,000,000 for 
fiscal year 2012, and $75,000,000 for fiscal year 
2013’’. 
(b) REPEAL OF LIMITATION ON AVAILABILITY OF 
FUNDING FOR FISCAL YEARS 2008 AND 2009.—Section 
201 of the Medicare, Medicaid, and SCHIP Extension Act 
of 2007 (Public Law 110–173) is amended— 
(1) in subsection (a), by striking paragraph (2) 
and redesignating paragraphs (3) and (4), as para-
graphs (2) and (3) respectively; and 
(2) in subsection (b), by striking paragraph (2). 
SEC. 3. ALLOTMENTS FOR THE 50 STATES AND THE DIS-
TRICT OF COLUMBIA BASED ON EXPENDI-
TURES AND NUMBERS OF LOW-INCOME CHIL-
DREN. 
(a) IN GENERAL.—Section 2104 of the Social Secu-
rity Act (42 U.S.C. 1397dd) is amended by adding at the 
end the following new subsection: 
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(b) 2-YEAR AVAILABILITY
OF ALLOTMENTS; EX-
PENDITURES
COUNTED
AGAINST
OLDEST
ALLOT-
MENTS.—Section 2104(e) of the Social Security Act (42 
U.S.C. 1397dd(e)) is amended to read as follows: 
‘‘(e) AVAILABILITY OF AMOUNTS ALLOTTED.— 
‘‘(1) IN GENERAL.—Except as provided in the 
succeeding paragraphs of this subsection, amounts 
allotted to a State pursuant to this section— 
‘‘(A) for each of fiscal years 1998 through 
2008, shall remain available for expenditure by 
the State through the end of the second suc-
ceeding fiscal year; and 
‘‘(B) for each of fiscal years 2009 through 
2013, shall remain available for expenditure by 
the State only through the end of the fiscal 
year succeeding the fiscal year for which such 
amounts are allotted. 
‘‘(2) ELIMINATION OF REDISTRIBUTION OF AL-
LOTMENTS NOT EXPENDED WITHIN 3 YEARS.—Not-
withstanding subsection (f), amounts allotted to a 
State under this section for fiscal years beginning 
with fiscal year 2009 that remain unexpended as of 
the end of the fiscal year succeeding the fiscal year 
for which the amounts are allotted shall not be re-
distributed to other States and shall revert to the 
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Treasury on October 1 of the third succeeding fiscal 
year. 
‘‘(3) RULE
FOR
COUNTING
EXPENDITURES 
AGAINST FISCAL YEAR ALLOTMENTS.—Expenditures 
under the State child health plan made on or after 
April 1, 2009, shall be counted against allotments 
for the earliest fiscal year for which funds are avail-
able for expenditure under this subsection.’’. 
(c) CONFORMING AMENDMENTS.— 
(1) Section 2104(b)(1) of the Social Security 
Act (42 U.S.C. 1397dd(b)(1)) is amended by strik-
ing ‘‘subsection (d)’’ and inserting ‘‘the succeeding 
subsections of this section’’. 
(2) Section 2104(f) of such Act (42 U.S.C. 
1397dd(f)) is amended by striking ‘‘The’’ and in-
serting ‘‘Subject to subsection (e)(2), the’’. 
SEC. 4. LIMITATIONS ON MATCHING RATES FOR POPU-
LATIONS OTHER THAN LOW-INCOME CHIL-
DREN 
OR 
PREGNANT 
WOMEN 
COVERED 
THROUGH A SECTION 1115 WAIVER. 
(a) LIMITATION ON PAYMENTS.—Section 2105(c) of 
the Social Security Act (42 U.S.C. 1397ee(c)) is amended 
by adding at the end the following new paragraph: 
‘‘(8) LIMITATIONS
ON
MATCHING
RATE
FOR 
POPULATIONS OTHER THAN TARGETED LOW-INCOME 
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CHILDREN
OR
PREGNANT
WOMEN
COVERED 
THROUGH
A
SECTION
1115
WAIVER.—For child 
health assistance or health benefits coverage fur-
nished in any fiscal year beginning with fiscal year 
2010: 
‘‘(A) FMAP APPLIED TO PAYMENTS FOR 
COVERAGE OF CHILDREN OR PREGNANT WOMEN 
COVERED
THROUGH
A
SECTION
1115
WAIVER 
ENROLLED IN THE STATE CHILD HEALTH PLAN 
ON THE DATE OF ENACTMENT OF THE KIDS 
FIRST ACT AND WHOSE GROSS FAMILY INCOME 
IS DETERMINED TO EXCEED THE INCOME ELI-
GIBILITY LEVEL SPECIFIED FOR A TARGETED 
LOW-INCOME
CHILD.—Notwithstanding 
sub-
sections (b)(1)(B) and (d) of section 2110, in 
the case of any individual described in sub-
section (c) of section 105 of the Kids First Act 
who the State elects to continue to provide child 
health assistance for under the State child 
health plan in accordance with the requirements 
of such subsection, the Federal medical assist-
ance percentage (as determined under section 
1905(b) without regard to clause (4) of such 
section) shall be substituted for the enhanced 
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FMAP under subsection (a)(1) with respect to 
such assistance. 
‘‘(B) FMAP APPLIED TO PAYMENTS ONLY 
FOR
NONPREGNANT
CHILDLESS
ADULTS
AND 
PARENTS
AND
CARETAKER
RELATIVES
EN-
ROLLED
UNDER
A
SECTION
1115
WAIVER
ON 
THE DATE OF ENACTMENT OF THE KIDS FIRST 
ACT.—The Federal medical assistance percent-
age (as determined under section 1905(b) with-
out regard to clause (4) of such section) shall 
be substituted for the enhanced FMAP under 
subsection (a)(1) with respect to payments for 
child health assistance or health benefits cov-
erage provided under the State child health 
plan for any of the following: 
‘‘(i) PARENTS
OR
CARETAKER
REL-
ATIVES ENROLLED UNDER A WAIVER ON 
THE DATE OF ENACTMENT OF THE KIDS 
FIRST ACT.—A nonpregnant parent or a 
nonpregnant caretaker relative of a tar-
geted low-income child who is enrolled in 
the State child health plan under a waiver, 
experimental, 
pilot, 
or 
demonstration 
project on the date of enactment of the 
Kids First Act and whose family income 
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does not exceed the income eligibility ap-
plied under such waiver with respect to 
that population on such date. 
‘‘(ii) 
NONPREGNANT
CHILDLESS 
ADULTS ENROLLED UNDER A WAIVER ON 
SUCH
DATE.—A nonpregnant childless 
adult enrolled in the State child health 
plan under a waiver, experimental, pilot, or 
demonstration project described in section 
6102(c)(3) of the Deficit Reduction Act of 
2005 (42 U.S.C. 1397gg note) on the date 
of enactment of the Kids First Act and 
whose family income does not exceed the 
income eligibility applied under such waiv-
er with respect to that population on such 
date. 
‘‘(iii) NO
REPLACEMENT
ENROLL-
EES.—Nothing in clauses (i) or (ii) shall 
be construed as authorizing a State to pro-
vide child health assistance or health bene-
fits coverage under a waiver described in 
either such clause to a nonpregnant parent 
or a nonpregnant caretaker relative of a 
targeted low-income child, or a nonpreg-
nant childless adult, who is not enrolled 
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under the waiver on the date of enactment 
of the Kids First Act. 
‘‘(C) NO
FEDERAL
PAYMENT
FOR
ANY 
NEW
NONPREGNANT
ADULT
ENROLLEES
OR 
FOR SUCH ENROLLEES WHO NO LONGER SAT-
ISFY
INCOME
ELIGIBILITY
REQUIREMENTS.— 
Payment shall not be made under this section 
for child health assistance or other health bene-
fits coverage provided under the State child 
health plan or under a waiver under section 
1115 for any of the following: 
‘‘(i) PARENTS
OR
CARETAKER
REL-
ATIVES
UNDER
A
SECTION
1115
WAIVER 
APPROVED AFTER THE DATE OF ENACT-
MENT OF THE KIDS FIRST ACT.—A non-
pregnant parent or a nonpregnant care-
taker relative of a targeted low-income 
child under a waiver, experimental, pilot, 
or demonstration project that is approved 
on or after the date of enactment of the 
Kids First Act. 
‘‘(ii) 
PARENTS, 
CARETAKER
REL-
ATIVES, AND
NONPREGNANT
CHILDLESS 
ADULTS WHOSE FAMILY INCOME EXCEEDS 
THE
INCOME
ELIGIBILITY
LEVEL
SPECI-
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experimental, 
pilot, 
or 
demonstration 
project 
referred 
to 
in 
subparagraph 
(B)(ii)(I) on such date. 
‘‘(D) DEFINITION
OF
CARETAKER
REL-
ATIVE.—In this subparagraph, the term ‘care-
taker relative’ has the meaning given that term 
for purposes of carrying out section 1931. 
‘‘(E) RULE OF CONSTRUCTION.—Nothing 
in this paragraph shall be construed as imply-
ing that payments for coverage of populations 
for which the Federal medical assistance per-
centage (as so determined) is to be substituted 
for the enhanced FMAP under subsection 
(a)(1) in accordance with this paragraph are to 
be made from funds other than the allotments 
determined for a State under section 2104.’’. 
(b) CONFORMING AMENDMENT.—Section 2105(a)(1) 
of the Social Security Act (42 U.S.C. 1397dd(a)(1)) is 
amended, in the matter preceding subparagraph (A), by 
inserting ‘‘or subsection (c)(8)’’ after ‘‘subparagraph 
(B)’’. 
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SEC. 5. PROHIBITION ON NEW SECTION 1115 WAIVERS FOR 
COVERAGE OF ADULTS OTHER THAN PREG-
NANT WOMEN. 
(a) IN GENERAL.—Section 2107(f) of the Social Se-
curity Act (42 U.S.C. 1397gg(f)) is amended— 
(1) by striking ‘‘, the Secretary’’ and inserting 
‘‘: 
‘‘(1) The Secretary’’; and 
(2) by adding at the end the following new 
paragraphs: 
‘‘(2) The Secretary may not approve, extend, 
renew, or amend a waiver, experimental, pilot, or 
demonstration project with respect to a State after 
the date of enactment of the Kids First Act that 
would allow funds made available under this title to 
be used to provide child health assistance or other 
health benefits coverage for any other adult other 
than a pregnant woman whose family income does 
not exceed the income eligibility level specified for a 
targeted low-income child in that State under a 
waiver or project approved as of such date. 
‘‘(3) The Secretary may not approve, extend, 
renew, or amend a waiver, experimental, pilot, or 
demonstration project with respect to a State after 
the date of enactment of the Kids First Act that 
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would waive or modify the requirements of section 
2105(c)(8).’’. 
(b) CLARIFICATION OF AUTHORITY FOR COVERAGE 
OF PREGNANT WOMEN.—Section 2106 of the Social Secu-
rity Act (42 U.S.C. 1397ff) is amended by adding at the 
end the following new subsection: 
‘‘(f) NO AUTHORITY TO COVER PREGNANT WOMEN 
THROUGH STATE PLAN.—For purposes of this title, a 
State may provide assistance to a pregnant woman under 
the State child health plan only— 
‘‘(1) by virtue of a waiver under section 1115; 
or 
‘‘(2) through the application of sections 457.10, 
457.350(b)(2), 457.622(c)(5), and 457.626(a)(3) of 
title 42, Code of Federal Regulations (as in effect on 
the date of enactment of the Kids First Act).’’. 
(c) ASSURANCE OF NOTICE TO AFFECTED ENROLL-
EES.—The Secretary of Health and Human Services shall 
establish procedures to ensure that States provide ade-
quate public notice for parents, caretaker relatives, and 
nonpregnant childless adults whose eligibility for child 
health assistance or health benefits coverage under a waiv-
er under section 1115 of the Social Security Act will be 
terminated as a result of the amendments made by sub-
section (a), and that States otherwise adhere to regula-
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tions of the Secretary relating to procedures for termi-
nating waivers under section 1115 of the Social Security 
Act. 
SEC. 6. STANDARDIZATION OF DETERMINATION OF FAMILY 
INCOME FOR TARGETED LOW-INCOME CHIL-
DREN UNDER TITLE XXI AND OPTIONAL TAR-
GETED 
LOW-INCOME 
CHILDREN 
UNDER 
TITLE XIX. 
(a) ELIGIBILITY BASED ON GROSS INCOME.— 
(1) IN GENERAL.—Section 2110 of the Social 
Security Act (42 U.S.C. 1397jj) is amended— 
(A) in subsection (b)(1)(A), by inserting 
‘‘in accordance with subsection (d)’’ after 
‘‘State plan’’; and 
(B) by adding at the end the following new 
subsection: 
‘‘(d) STANDARDIZATION
OF
DETERMINATION
OF 
FAMILY INCOME.—A State shall determine family income 
for purposes of determining income eligibility for child 
health assistance or other health benefits coverage under 
the State child health plan (or under a waiver of such plan 
under section 1115) solely on the basis of the gross income 
(as defined by the Secretary) of the family.’’. 
(2) PROHIBITION
ON
WAIVER
OF
REQUIRE-
MENTS.—Section 2107(f) (42 U.S.C. 1397gg(f)), as 
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amended by section 5(a), is amended by adding at 
the end the following new paragraph: 
‘‘(4) The Secretary may not approve a waiver, 
experimental, pilot, or demonstration project with re-
spect to a State after the date of enactment of the 
Kids First Act that would waive or modify the re-
quirements of section 2110(d) (relating to deter-
mining income eligibility on the basis of gross in-
come) and regulations promulgated to carry out 
such requirements.’’. 
(b) REGULATIONS.—Not later than 90 days after the 
date of enactment of this Act, the Secretary of Health and 
Human Services shall promulgate interim final regulations 
defining gross income for purposes of section 2110(d) of 
the Social Security Act, as added by subsection (a). 
(c) APPLICATION TO CURRENT ENROLLEES.—The 
interim final regulations promulgated under subsection (b) 
shall not be used to determine the income eligibility of any 
individual enrolled in a State child health plan under title 
XXI of the Social Security Act on the date of enactment 
of this Act before the date on which such eligibility of the 
individual is required to be redetermined under the plan 
as in effect on such date. In the case of any individual 
enrolled in such plan on such date who, solely as a result 
of the application of subsection (d) of section 2110 of the 
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Social Security Act (as added by subsection (a)) and the 
regulations promulgated under subsection (b), is deter-
mined to be ineligible for child health assistance under the 
State child health plan, a State may elect, subject to sub-
stitution of the Federal medical assistance percentage for 
the enhanced FMAP under section 2105(c)(8)(A) of the 
Social Security Act (as added by section 4(a)), to continue 
to provide the individual with such assistance for so long 
as the individual otherwise would be eligible for such as-
sistance and the individual’s family income, if determined 
under the income and resource standards and methodolo-
gies applicable under the State child health plan on Sep-
tember 30, 2008, would not exceed the income eligibility 
level applicable to the individual under the State child 
health plan. 
SEC. 7. GRANTS FOR OUTREACH AND ENROLLMENT. 
(a) GRANTS.—Title XXI of the Social Security Act 
(42 U.S.C. 1397aa et seq.) is amended by adding at the 
end the following: 
‘‘SEC. 2111. GRANTS TO IMPROVE OUTREACH AND ENROLL-
MENT. 
‘‘(a) OUTREACH AND ENROLLMENT GRANTS; NA-
TIONAL CAMPAIGN.— 
‘‘(1) IN GENERAL.—From the amounts appro-
priated for a fiscal year under subsection (f), subject 
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to paragraph (2), the Secretary shall award grants 
to eligible entities to conduct outreach and enroll-
ment efforts that are designed to increase the enroll-
ment and participation of eligible children under this 
title and title XIX. 
‘‘(2) 10 PERCENT SET ASIDE FOR NATIONAL 
ENROLLMENT CAMPAIGN.—An amount equal to 10 
percent of such amounts for the fiscal year shall be 
used by the Secretary for expenditures during the 
fiscal year to carry out a national enrollment cam-
paign in accordance with subsection (g). 
‘‘(b) AWARD OF GRANTS.— 
‘‘(1) PRIORITY FOR AWARDING.— 
‘‘(A) IN
GENERAL.—In awarding grants 
under subsection (a), the Secretary shall give 
priority to eligible entities that— 
‘‘(i) propose to target geographic 
areas with high rates of— 
‘‘(I) eligible but unenrolled chil-
dren, including such children who re-
side in rural areas; or 
‘‘(II) racial and ethnic minorities 
and health disparity populations, in-
cluding those proposals that address 
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cultural and linguistic barriers to en-
rollment; and 
‘‘(ii) submit the most demonstrable 
evidence required under paragraphs (1) 
and (2) of subsection (c). 
‘‘(B) 10 PERCENT SET ASIDE FOR OUT-
REACH
TO
INDIAN
CHILDREN.—An amount 
equal to 10 percent of the funds appropriated 
under subsection (f) for a fiscal year shall be 
used by the Secretary to award grants to In-
dian Health Service providers and urban Indian 
organizations receiving funds under title V of 
the Indian Health Care Improvement Act (25 
U.S.C. 1651 et seq.) for outreach to, and en-
rollment of, children who are Indians. 
‘‘(2) 2-YEAR AVAILABILITY.—A grant awarded 
under this section for a fiscal year shall remain 
available for expenditure through the end of the suc-
ceeding fiscal year. 
‘‘(c) APPLICATION.—An eligible entity that desires to 
receive a grant under subsection (a) shall submit an appli-
cation to the Secretary in such form and manner, and con-
taining such information, as the Secretary may decide. 
Such application shall include— 
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‘‘(1) evidence demonstrating that the entity in-
cludes members who have access to, and credibility 
with, ethnic or low-income populations in the com-
munities in which activities funded under the grant 
are to be conducted; 
‘‘(2) evidence demonstrating that the entity has 
the ability to address barriers to enrollment, such as 
lack of awareness of eligibility, stigma concerns and 
punitive fears associated with receipt of benefits, 
and other cultural barriers to applying for and re-
ceiving child health assistance or medical assistance; 
‘‘(3) specific quality or outcomes performance 
measures to evaluate the effectiveness of activities 
funded by a grant awarded under this section; and 
‘‘(4) an assurance that the eligible entity 
shall— 
‘‘(A) conduct an assessment of the effec-
tiveness of such activities against the perform-
ance measures; 
‘‘(B) cooperate with the collection and re-
porting of enrollment data and other informa-
tion in order for the Secretary to conduct such 
assessments; and 
‘‘(C) in the case of an eligible entity that 
is not the State, provide the State with enroll-
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ment data and other information as necessary 
for the State to make necessary projections of 
eligible children and pregnant women. 
‘‘(d) SUPPLEMENT, NOT SUPPLANT.—Federal funds 
awarded under this section shall be used to supplement, 
not supplant, non-Federal funds that are otherwise avail-
able for activities funded under this section. 
‘‘(e) DEFINITIONS.—In this section: 
‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible en-
tity’ means any of the following: 
‘‘(A) A State with an approved child health 
plan under this title. 
‘‘(B) A local government. 
‘‘(C) An Indian tribe or tribal consortium, 
a tribal organization, an urban Indian organiza-
tion receiving funds under title V of the Indian 
Health Care Improvement Act (25 U.S.C. 1651 
et seq.), or an Indian Health Service provider. 
‘‘(D) A Federal health safety net organiza-
tion. 
‘‘(E) A State, national, local, or commu-
nity-based public or nonprofit private organiza-
tion. 
‘‘(F) A faith-based organization or con-
sortia, to the extent that a grant awarded to 
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such an entity is consistent with the require-
ments of section 1955 of the Public Health 
Service Act (42 U.S.C. 300x–65) relating to a 
grant award to non-governmental entities. 
‘‘(G) An elementary or secondary school. 
‘‘(H) A national, local, or community-based 
public or nonprofit private organization, includ-
ing organizations that use community health 
workers or community-based doula programs. 
‘‘(2) FEDERAL HEALTH SAFETY NET ORGANI-
ZATION.—The term ‘Federal health safety net orga-
nization’ means— 
‘‘(A) a federally-qualified health center (as 
defined in section 1905(l)(2)(B)); 
‘‘(B) a hospital defined as a dispropor-
tionate share hospital for purposes of section 
1923; 
‘‘(C) a covered entity described in section 
340B(a)(4) of the Public Health Service Act 
(42 U.S.C. 256b(a)(4)); and 
‘‘(D) any other entity or consortium that 
serves children under a federally-funded pro-
gram, including the special supplemental nutri-
tion program for women, infants, and children 
(WIC) established under section 17 of the Child 
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Nutrition Act of 1966 (42 U.S.C. 1786), the 
head start and early head start programs under 
the Head Start Act (42 U.S.C. 9801 et seq.), 
the school lunch program established under the 
Richard B. Russell National School Lunch Act, 
and an elementary or secondary school. 
‘‘(3) INDIANS; INDIAN TRIBE; TRIBAL ORGANI-
ZATION; URBAN INDIAN ORGANIZATION.—The terms 
‘Indian’, ‘Indian tribe’, ‘tribal organization’, and 
‘urban Indian organization’ have the meanings given 
such terms in section 4 of the Indian Health Care 
Improvement Act (25 U.S.C. 1603). 
‘‘(4) COMMUNITY HEALTH WORKER.—The term 
‘community health worker’ means an individual who 
promotes health or nutrition within the community 
in which the individual resides— 
‘‘(A) by serving as a liaison between com-
munities and health care agencies; 
‘‘(B) by providing guidance and social as-
sistance to community residents; 
‘‘(C) by enhancing community residents’ 
ability to effectively communicate with health 
care providers; 
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‘‘(D) by providing culturally and linguis-
tically appropriate health or nutrition edu-
cation; 
‘‘(E) by advocating for individual and com-
munity health or nutrition needs; and 
‘‘(F) by providing referral and followup 
services. 
‘‘(f) APPROPRIATION.— 
‘‘(1) IN GENERAL.—There is appropriated, out 
of any money in the Treasury not otherwise appro-
priated, for the purpose of awarding grants under 
this section— 
‘‘(A) $100,000,000 for each of fiscal years 
2009 and 2010; 
‘‘(B) $75,000,000 for each of fiscal years 
2011 and 2012; and 
‘‘(C) $50,000,000 for fiscal year 2013. 
‘‘(2) GRANTS IN ADDITION TO OTHER AMOUNTS 
PAID.—Amounts appropriated and paid under the 
authority of this section shall be in addition to 
amounts appropriated under section 2104 and paid 
to States in accordance with section 2105, including 
with respect to expenditures for outreach activities 
in accordance with subsections (a)(1)(D)(iii) and 
(c)(2)(C) of that section. 
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‘‘(g) NATIONAL ENROLLMENT CAMPAIGN.—From 
the amounts made available under subsection (a)(2) for 
a fiscal year, the Secretary shall develop and implement 
a national enrollment campaign to improve the enrollment 
of underserved child populations in the programs estab-
lished under this title and title XIX. Such campaign may 
include— 
‘‘(1) the establishment of partnerships with the 
Secretary of Education and the Secretary of Agri-
culture to develop national campaigns to link the eli-
gibility and enrollment systems for the assistance 
programs each Secretary administers that often 
serve the same children; 
‘‘(2) the integration of information about the 
programs established under this title and title XIX 
in public health awareness campaigns administered 
by the Secretary; 
‘‘(3) increased financial and technical support 
for enrollment hotlines maintained by the Secretary 
to ensure that all States participate in such hotlines; 
‘‘(4) the establishment of joint public awareness 
outreach initiatives with the Secretary of Education 
and the Secretary of Labor regarding the impor-
tance of health insurance to building strong commu-
nities and the economy; 
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‘‘(5) the development of special outreach mate-
rials for Native Americans or for individuals with 
limited English proficiency; and 
‘‘(6) such other outreach initiatives as the Sec-
retary determines would increase public awareness of 
the programs under this title and title XIX.’’. 
(b) NONAPPLICATION OF ADMINISTRATIVE EXPENDI-
TURES CAP.—Section 2105(c)(2) of the Social Security 
Act (42 U.S.C. 1397ee(c)(2)) is amended by adding at the 
end the following: 
‘‘(C) NONAPPLICATION TO EXPENDITURES 
FOR OUTREACH AND ENROLLMENT.—The limi-
tation under subparagraph (A) shall not apply 
with respect to expenditures for outreach activi-
ties under section 2102(c)(1), or for enrollment 
activities, for children eligible for child health 
assistance under the State child health plan or 
medical assistance under the State plan under 
title XIX.’’. 
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SEC. 8. IMPROVED STATE OPTION FOR OFFERING PRE-
MIUM ASSISTANCE FOR COVERAGE OF CHIL-
DREN THROUGH PRIVATE PLANS UNDER 
SCHIP AND MEDICAID. 
(a) IN GENERAL.—Section 2105(c) of the Social Se-
curity Act (42 U.S.C. 1397ee(c)), as amended by section 
4(a) is amended by adding at the end the following: 
‘‘(9) ADDITIONAL STATE OPTION FOR OFFER-
ING PREMIUM ASSISTANCE.— 
‘‘(A) IN
GENERAL.—Subject to the suc-
ceeding provisions of this paragraph, a State 
may elect to offer a premium assistance subsidy 
(as defined in subparagraph (C)) for qualified 
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 accordance with 
the requirements of this paragraph. 
‘‘(B) 
QUALIFIED
COVERAGE.—In 
this 
paragraph, the term ‘qualified coverage’ means 
the following: 
‘‘(i) QUALIFIED
EMPLOYER
SPON-
SORED COVERAGE.— 
‘‘(I) 
IN
GENERAL.—A 
group 
health plan or health insurance cov-
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erage offered through an employer 
that is— 
‘‘(aa) substantially equiva-
lent to the benefits coverage in a 
benchmark benefit package de-
scribed in section 2103(b) or 
benchmark-equivalent 
coverage 
that meets the requirements of 
section 2103(a)(2); 
‘‘(bb) made similarly avail-
able to all of the employer’s em-
ployees and for which the em-
ployer makes a contribution to 
the premium that is not less for 
employees receiving a premium 
assistance subsidy under any op-
tion available under the State 
child health plan under this title 
or the State plan under title XIX 
to provide such assistance than 
the employer contribution pro-
vided for all other employees; and 
‘‘(cc) cost-effective, as deter-
mined under subclause (II). 
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‘‘(II) COST-EFFECTIVENESS.—A 
group health plan or health insurance 
coverage offered through an employer 
shall be considered to be cost-effective 
if— 
‘‘(aa) the marginal premium 
cost to purchase family coverage 
through the employer is less than 
the State cost of providing child 
health assistance through the 
State child health plan for all the 
children in the family who are 
targeted low-income children; or 
‘‘(bb) the marginal premium 
cost between individual coverage 
and purchasing family coverage 
through the employer is not 
greater than 175 percent of the 
cost to the State to provide child 
health assistance through the 
State child health plan for a tar-
geted low-income child. 
‘‘(ii) QUALIFIED
NON-GROUP
COV-
ERAGE.—Health insurance coverage of-
fered to individuals in the non-group 
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health insurance market that is substan-
tially 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). 
‘‘(iii) HIGH
DEDUCTIBLE
HEALTH 
PLAN.—A high deductible health plan (as 
defined in section 223(c)(2) of the Internal 
Revenue Code of 1986) purchased through 
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-
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 
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annual aggregate cost-sharing limit applied 
under section 2103(e)(3)(B). 
‘‘(ii) STATE PAYMENT OPTION.—Sub-
ject to clause (iii), a State may provide a 
premium assistance subsidy directly to an 
employer or as reimbursement to an em-
ployee for out-of-pocket expenditures. 
‘‘(iii) REQUIREMENT
FOR
DIRECT 
PAYMENT
TO
EMPLOYEE.—A State shall 
not pay a premium assistance subsidy di-
rectly to the employee, unless the State has 
established procedures to ensure that the 
targeted low-income child on whose behalf 
such payments are made are actually en-
rolled in the qualified employer sponsored 
coverage. 
‘‘(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. 
‘‘(v) STATE OPTION TO REQUIRE AC-
CEPTANCE
OF
SUBSIDY.—A State may 
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condition the provision of child health as-
sistance under the State child health plan 
for a targeted low-income child on the re-
ceipt of a premium assistance subsidy for 
enrollment in qualified employer sponsored 
coverage if the State determines the provi-
sion of such a subsidy to be more cost-ef-
fective in accordance with subparagraph 
(B)(ii). 
‘‘(vi) NOT
TREATED
AS
INCOME.— 
Notwithstanding any other provision of 
law, a premium assistance subsidy pro-
vided in accordance with this paragraph 
shall not be treated as income to the child 
or the parent of the child for whom such 
subsidy is provided. 
‘‘(D) NO REQUIREMENT TO PROVIDE SUP-
PLEMENTAL COVERAGE FOR BENEFITS AND AD-
DITIONAL
COST-SHARING
PROTECTION
PRO-
VIDED
UNDER
THE
STATE
CHILD
HEALTH 
PLAN.— 
‘‘(i) IN
GENERAL.—A State that 
elects the option to provide a premium as-
sistance subsidy under this paragraph shall 
not be required to provide a targeted low- 
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income child enrolled in qualified employer 
sponsored coverage with supplemental cov-
erage for items or services that are not 
covered, or are only partially covered, 
under the qualified employer sponsored 
coverage or cost-sharing protection other 
than the protection required under section 
2103(e)(3)(B). 
‘‘(ii) NOTICE
OF
COST-SHARING
RE-
QUIREMENTS.—A State shall provide a tar-
geted low-income child or the parent of 
such a child (as appropriate) who is pro-
vided with a premium assistance subsidy in 
accordance with this paragraph with notice 
of the cost-sharing requirements and limi-
tations imposed under the qualified em-
ployer sponsored coverage in which the 
child is enrolled upon the enrollment of the 
child in such coverage and annually there-
after. 
‘‘(iii) RECORD
KEEPING
REQUIRE-
MENTS.—A State may require a parent of 
a targeted low-income child that is enrolled 
in qualified employer-sponsored coverage to 
bear the responsibility for keeping track of 
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out-of-pocket expenditures incurred for 
cost-sharing imposed under such coverage 
and to notify the State when the limit on 
such expenditures imposed under section 
2103(e)(3)(B) has been reached for a year 
from the effective date of enrollment for 
such year. 
‘‘(iv) STATE OPTION FOR REIMBURSE-
MENT.—A State may retroactively reim-
burse a parent of a targeted low-income 
child for out-of-pocket expenditures in-
curred after reaching the 5 percent cost- 
sharing limitation imposed under section 
2103(e)(3)(B) for a year. 
‘‘(E) 6-MONTH
WAITING
PERIOD
RE-
QUIRED.—A State shall impose at least a 6- 
month waiting period from the time an indi-
vidual is enrolled in private health insurance 
prior to the provision of a premium assistance 
subsidy for a targeted low-income child in ac-
cordance with this paragraph. 
‘‘(F) NON APPLICATION OF WAITING PE-
RIOD FOR ENROLLMENT IN THE STATE MED-
ICAID
PLAN
OR
THE
STATE
CHILD
HEALTH 
PLAN.—A targeted low-income child provided a 
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premium assistance subsidy in accordance with 
this paragraph who loses eligibility for such 
subsidy shall not be treated as having been en-
rolled in private health insurance coverage for 
purposes of applying any waiting period im-
posed under the State child health plan or the 
State plan under title XIX for the enrollment of 
the child under such plan. 
‘‘(G) ASSURANCE
OF
SPECIAL
ENROLL-
MENT PERIOD UNDER GROUP HEALTH PLANS 
IN CASE OF ELIGIBILITY FOR PREMIUM SUB-
SIDY ASSISTANCE.—No payment shall be made 
under subsection (a) for amounts expended for 
the provision of premium assistance subsidies 
under this paragraph unless a State provides 
assurances to the Secretary that the State has 
in effect laws requiring a group health plan, a 
health insurance issuer offering group health 
insurance coverage in connection with a group 
health plan, and a self-funded health plan, to 
permit an employee who is eligible, but not en-
rolled, for coverage under the terms of the plan 
(or a child of such an employee if the child is 
eligible, but not enrolled, for coverage under 
such terms) to enroll for coverage under the 
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terms of the plan if the employee’s child be-
comes eligible for a premium assistance subsidy 
under this paragraph. 
‘‘(H) NO
EFFECT
ON
PREVIOUSLY
AP-
PROVED
PREMIUM
ASSISTANCE
PROGRAMS.— 
Nothing in this paragraph shall be construed as 
limiting the authority of a State to offer pre-
mium assistance under section 1906, a waiver 
described in paragraph (2)(B) or (3), a waiver 
approved under section 1115, or other authority 
in effect on February 1, 2009. 
‘‘(I) NOTICE OF AVAILABILITY.—A 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 
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‘‘(iii) establish such other procedures 
as the State determines necessary to en-
sure that parents are informed of the 
availability of such subsidies under the 
State child health plan.’’. 
(b) APPLICATION TO MEDICAID.—Section 1906 of 
the Social Security Act (42 U.S.C. 1396e) is amended by 
inserting after subsection (c) the following: 
‘‘(d) The provisions of section 2105(c)(9) shall apply 
to a child who is eligible for medical assistance under the 
State plan in the same manner as such provisions apply 
to a targeted low-income child under a State child health 
plan under title XXI. Section 1902(a)(34) shall not apply 
to a child who is provided a premium assistance subsidy 
under the State plan in accordance with the preceding sen-
tence.’’. 
SEC. 9. TREATMENT OF UNBORN CHILDREN. 
(a) CODIFICATION
OF CURRENT REGULATIONS.— 
Section 2110(c)(1) of the Social Security Act (42 U.S.C. 
1397jj(c)(1)) is amended by striking the period at the end 
and inserting the following: ‘‘, and includes, at the option 
of a State, an unborn child. For purposes of the previous 
sentence, the term ‘unborn child’ means a member of the 
species Homo sapiens, at any stage of development, who 
is carried in the womb.’’. 
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(b) CLARIFICATIONS
REGARDING
COVERAGE
OF 
MOTHERS.—Section 2103 (42 U.S.C. 1397cc) is amended 
by adding at the end the following new subsection: 
‘‘(g) CLARIFICATIONS REGARDING AUTHORITY TO 
PROVIDE
POSTPARTUM
SERVICES
AND
MATERNAL 
HEALTH CARE.—Any State that provides child health as-
sistance to an unborn child under the option described in 
section 2110(c)(1) may— 
‘‘(1) continue to provide such assistance to the 
mother, as well as postpartum services, through the 
end of the month in which the 60-day period (begin-
ning on the last day of pregnancy) ends; and 
‘‘(2) in the interest of the child to be born, have 
flexibility in defining and providing services to ben-
efit either the mother or unborn child consistent 
with the health of both.’’. 
SEC. 10. 50 PERCENT MATCHING RATE FOR ALL MEDICAID 
ADMINISTRATIVE COSTS. 
Section 1903(a) of the Social Security Act (42 U.S.C. 
1396b(a)) is amended— 
(1) by striking paragraph (2); 
(2) by redesignating paragraph (3)(E) as para-
graph (2) and re-locating and indenting it appro-
priately; 
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(3) in paragraph (2), as so redesignated, by re-
designating clauses (i) and (ii) as subparagraphs (A) 
and (B), and indenting them appropriately; 
(4) by striking paragraphs (3) and (4); 
(5) in paragraph (5), by striking ‘‘which are at-
tributable to the offering, arranging, and fur-
nishing’’ and inserting ‘‘which are for the medical 
assistance costs of furnishing’’; 
(6) by striking paragraph (6); 
(7) in paragraph (7), by striking ‘‘subject to 
section 1919(g)(3)(B),’’; and 
(8) by redesignating paragraphs (5) and (7) as 
paragraphs (3) and (4), respectively. 
SEC. 11. REDUCTION IN PAYMENTS FOR MEDICAID ADMIN-
ISTRATIVE COSTS TO PREVENT DUPLICATION 
OF SUCH PAYMENTS UNDER TANF. 
Section 1903 of the Social Security Act (42 U.S.C. 
1396b) is amended— 
(1) in subsection (a)(7), by striking ‘‘section 
1919(g)(3)(B)’’ and inserting ‘‘subsection (h)’’; 
(2) in subsection (a)(2)(D) by inserting ‘‘, sub-
ject to subsection (g)(3)(C) of such section’’ after 
‘‘as are attributable to State activities under section 
1919(g)’’; and 
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(3) by adding after subsection (g) the following 
new subsection: 
‘‘(h) REDUCTION IN PAYMENTS FOR ADMINISTRA-
TIVE COSTS TO PREVENT DUPLICATION OF PAYMENTS 
UNDER TITLE IV.—Beginning with the calendar quarter 
commencing April 1, 2009, the Secretary shall reduce the 
amount paid to each State under subsection (a)(7) for 
each quarter by an amount equal to 1⁄4 of the annualized 
amount determined for the Medicaid program under sec-
tion 16(k)(2)(B) of the Food Stamp Act of 1977 (7 U.S.C. 
2025(k)(2)(B)).’’. 
SEC. 12. ELIMINATION OF WAIVER OF CERTAIN MEDICAID 
PROVIDER TAX PROVISIONS. 
Effective October 1, 2009, subsection (c) of section 
4722 of the Balanced Budget Act of 1997 (Public Law 
105–33; 111 Stat. 515) is repealed. 
SEC. 13. ELIMINATION OF SPECIAL PAYMENTS FOR CER-
TAIN PUBLIC HOSPITALS. 
Effective October 1, 2009, subsection (d) of section 
701 of the Medicare, Medicaid, and SCHIP Benefits Im-
provement and Protection Act of 2000, as enacted into 
law by section 1(a)(6) of Public Law 106–554 (42 U.S.C. 
1396r–4 note), is repealed. 
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SEC. 14. EFFECTIVE DATE; COORDINATION OF FUNDING 
FOR FISCAL YEAR 2009. 
(a) IN GENERAL.—Unless otherwise specified, sub-
ject to subsection (b), the amendments made by this Act 
shall take effect on the date of enactment of this Act. 
(b) DELAY IF STATE LEGISLATION REQUIRED.—In 
the case of a State child health plan under title XXI of 
the Social Security Act or a waiver of such plan under 
section 1115 of such Act which the Secretary of Health 
and Human Services determines requires State legislation 
(other than legislation appropriating funds) in order for 
the plan or waiver to meet the additional requirements im-
posed by the amendments made by this Act, the State 
child health plan or waiver shall not be regarded as failing 
to comply with the requirements of such title XXI solely 
on the basis of its failure to meet such additional require-
ments before the first day of the first calendar quarter 
beginning after the close of the first regular session of the 
State legislature that begins after the date of the enact-
ment of this Act. For purposes of the previous sentence, 
in the case of a State that has a 2-year legislative session, 
each year of such session shall be deemed to be a separate 
regular session of the State legislature. 
(c) COORDINATION OF FUNDING FOR FISCAL YEAR 
2009.—Notwithstanding any other provision of law, inso-
far as funds have been appropriated under section 
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2104(a)(11) of the Social Security Act, as amended by 
section 201(a) of Public Law 110–173 and in effect on 
January 1, 2009, to provide allotments to States under 
title XXI of the Social Security Act for fiscal year 2009— 
(1) any amounts that are so appropriated that 
are not so allotted and obligated before the date of 
the enactment of this Act are rescinded; and 
(2) any amount provided for allotments under 
title XXI of such Act to a State under the amend-
ments made by this Act for such fiscal year shall be 
reduced by the amount of such appropriations so al-
lotted and obligated before such date. 
Æ 
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