a demonstration grant is approved under this 
section, the FMAP of the State shall be in-
creased by 3 percentage points for each cal-
endar quarter occurring during the period re-
ferred to in subsection (c). 
‘‘(B) FMAP.—In this paragraph, the term 
‘FMAP’ means the Federal medical assistance 
percentage, as defined in section 1905(b) of the 
Social Security Act (42 U.S.C. 1396d(b)). 
‘‘(f) WAIVER OF ERISA PREEMPTION AND WAIVERS 
TO POOL FUNDS.—As part of a demonstration grant 
under this section and subject to the benefit maintenance 
requirements applicable under section 2203(b), a State 
may request (and the Secretary may grant) the following 
waivers of requirements and provisions to the extent nec-
essary to carry out the State plan under section 2203: 
‘‘(1) ERISA.—Waiving application of section 
514 of the Employee Retirement Income Security 
Act of 1974. 
‘‘(2) MEDICARE.—Waiving provisions necessary 
to permit the State— 
‘‘(A) to use funds otherwise paid under 
title XVIII for beneficiaries residing in the 
State; and
‘‘(B) to permit the State to enter into an 
arrangement with the Secretary under which el-
igible State residents who are not otherwise en-
rolled for benefits under parts A and B of such 
title are enrolled for such benefits under such 
title and the State provides for such actuarially 
appropriate reimbursement to the Secretary 
with respect to coverage of such benefits for 
such residents as is necessary to assure that the 
Trust Funds under such title are not adversely 
affected by virtue of such waiver, such reim-
bursement subject to— 
‘‘(i) an independent audit, to be re-
viewed by the Comptroller General of the 
United States, assuring that such reim-
bursement does not adversely affect in any 
way the Trust Funds for medicare eligible 
beneficiaries, and 
‘‘(ii) in the case that the audit deter-
mines that additional reimbursement to the 
Secretary is required, such additional reim-
bursement, with appropriate adjustments 
for interest attributable to the late reim-
bursement.
‘‘(3) MEDICAID.—Waiving provisions necessary 
to permit the State to use funds otherwise paid to 
the State under title XIX. 
‘‘(4) SCHIP.—Waiving provisions necessary to 
permit the State to use funds otherwise paid to the 
State under title XXI. 
‘‘(5) FEHBP.—Waiving provisions necessary to 
permit the State to use funds otherwise paid under 
chapter 89 of title 5, United States Code, or allow-
ing the Office of Personnel Management to purchase 
health care coverage for Federal employees and re-
tirees in the State under the State plan. 
‘‘(6) USE OF OTHER FUNDS.—Waiving provi-
sions necessary to permit the State to use funds oth-
erwise provided under other Federal programs for 
the provision of health care coverage or services, 
identified by the State. 
‘‘(7) OTHER
LAWS.—Waiving of other provi-
sions of Federal law identified by the State under 
section 2203(e)(3) only if the Secretary determines 
such a waiver to be appropriate after consultation 
with the head of the Federal agency or department 
concerned. 
The Secretary may grant a waiver under this subsection 
only if the State provides the Secretary with satisfactory
assurances that necessary safeguards have been taken to 
protect the health and welfare of individuals provided serv-
ices under the waiver and that financial accountability is 
maintained for any funds expended under the waiver. The 
Secretary may grant a waiver under paragraph (1) only 
with the concurrence of the Secretary of Labor. 
‘‘(g) REENROLLMENT
OF ELIGIBLE STATE RESI-
DENTS WHO MOVE FROM A PARTICIPATING STATE.—In 
the case of an eligible State resident who is covered under 
a State plan under section 2203, who (but for such cov-
erage) is eligible to be enrolled in a program described in 
subsection (f) (including the medicare and medicaid pro-
grams), and who is not enrolled in such a program because 
of such coverage, if the resident leaves the State to reside 
in a State that does not have such a State plan in effect, 
the resident shall be permitted, notwithstanding any other 
provision of law, to enroll immediately in such a program 
if the resident is still otherwise eligible to be so enrolled. 
In the case of such enrollment in the medicare program, 
the resident shall be treated for purposes of section 
1882(s)(2) (relating to availability of medigap policies 
without underwriting) as if the resident had turned 65 
years of age on the date the resident enrolls in the medi-
care program. 
‘‘(h) DUTIES OF THE SECRETARY.—
‘‘(1) GUIDANCE AND INFORMATION.—The Sec-
retary shall— 
‘‘(A) provide guidance to State health care 
authorities regarding applications for grants 
under this title and exchange information with, 
and otherwise assist, such authorities upon the 
request of the authorities; 
‘‘(B) set application procedures; 
‘‘(C) review and approve applications for 
demonstration grants under this section, includ-
ing providing for appropriate waivers described 
in subsection (f); 
‘‘(D) provide appropriate levels of funding 
for such approved applications consistent with 
such section; 
‘‘(E) conduct such evaluation, monitoring, 
compliance, and other review functions as may 
be appropriate; 
‘‘(F) develop guidelines, standards, and 
formats for States to follow in evaluating, re-
porting, and collecting data in order to enable 
the Commission to monitor State plan adminis-
tration and compliance, and to evaluate and 
compare the effectiveness of State plans; and