105 
SEC. 202. INCREASED OUTREACH AND ENROLLMENT OF IN-
DIANS. 
(a) IN GENERAL.—Section 1139 (42 U.S.C. 1320b–9) 
is amended to read as follows: 
‘‘SEC. 1139. IMPROVED ACCESS TO, AND DELIVERY OF, 
HEALTH CARE FOR INDIANS UNDER TITLES 
XIX AND XXI. 
‘‘(a) AGREEMENTS WITH STATES FOR MEDICAID AND 
CHIP OUTREACH ON OR NEAR RESERVATIONS TO IN-
CREASE THE ENROLLMENT OF INDIANS IN THOSE PRO-
GRAMS.— 
‘‘(1) IN GENERAL.—In order to improve the ac-
cess of Indians residing on or near a reservation to 
obtain benefits under the Medicaid and State chil-
dren’s health insurance programs established under 
titles XIX and XXI, the Secretary shall encourage the 
State to take steps to provide for enrollment on or 
near the reservation. Such steps may include outreach 
efforts such as the outstationing of eligibility workers, 
entering into agreements with the Indian Health 
Service, Indian Tribes, Tribal Organizations, and 
Urban Indian Organizations to provide outreach, 
education regarding eligibility and benefits, enroll-
ment, and translation services when such services are 
appropriate.
106 
‘‘(2) CONSTRUCTION.—Nothing in paragraph (1) 
shall be construed as affecting arrangements entered 
into between States and the Indian Health Service, 
Indian Tribes, Tribal Organizations, or Urban In-
dian Organizations for such Service, Tribes, or Orga-
nizations to conduct administrative activities under 
such titles. 
‘‘(b) REQUIREMENT TO FACILITATE COOPERATION.— 
The Secretary, acting through the Centers for Medicare & 
Medicaid Services, shall take such steps as are necessary 
to facilitate cooperation with, and agreements between, 
States and the Indian Health Service, Indian Tribes, Trib-
al Organizations, or Urban Indian Organizations with re-
spect to the provision of health care items and services to 
Indians under the programs established under title XIX or 
XXI. 
‘‘(c) DEFINITION OF INDIAN; INDIAN TRIBE; INDIAN 
HEALTH PROGRAM; TRIBAL ORGANIZATION; URBAN INDIAN 
ORGANIZATION.—In this section, the terms ‘Indian’, ‘In-
dian Tribe’, ‘Indian Health Program’, ‘Tribal Organiza-
tion’, and ‘Urban Indian Organization’ have the meanings 
given those terms in section 4 of the Indian Health Care 
Improvement Act.’’. 
(b) NONAPPLICATION OF 10 PERCENT LIMIT ON OUT-
REACH
AND CERTAIN OTHER EXPENDITURES.—Section
107 
2105(c)(2) (42 U.S.C. 1397ee(c)(2)) is amended by adding 
at the end the following: 
‘‘(C) NONAPPLICATION
TO
CERTAIN
EX-
PENDITURES.—The limitation under subpara-
graph (A) shall not apply with respect to the fol-
lowing expenditures: 
‘‘(i) 
EXPENDITURES
TO
INCREASE 
OUTREACH TO, AND THE ENROLLMENT OF, 
INDIAN CHILDREN UNDER THIS TITLE AND 
TITLE xix.—Expenditures for outreach ac-
tivities to families of Indian children likely 
to be eligible for child health assistance 
under the plan or medical assistance under 
the State plan under title XIX (or under a 
waiver of such plan), to inform such fami-
lies of the availability of, and to assist them 
in enrolling their children in, such plans, 
including such activities conducted under 
grants, contracts, or agreements entered into 
under section 1139(a).’’. 
SEC. 203. STATE OPTION TO RELY ON FINDINGS FROM AN 
EXPRESS LANE AGENCY TO CONDUCT SIM-
PLIFIED ELIGIBILITY DETERMINATIONS. 
(a) APPLICATION UNDER MEDICAID AND CHIP PRO-
GRAMS.—
108 
(1) MEDICAID.—Section 1902(e) (42 U.S.C. 
1396a(e)) is amended by adding at the end the fol-
lowing: 
‘‘(13) EXPRESS LANE OPTION.— 
‘‘(A) IN GENERAL.— 
‘‘(i) OPTION TO USE A FINDING FROM AN 
EXPRESS LANE AGENCY.—At the option of the 
State, the State plan may provide that in deter-
mining eligibility under this title for a child (as 
defined in subparagraph (G)), the State may 
rely on a finding made within a reasonable pe-
riod (as determined by the State) from an Ex-
press Lane agency (as defined in subparagraph 
(F)) when it determines whether a child satisfies 
one or more components of eligibility for medical 
assistance under this title. The State may rely 
on a finding from an Express Lane agency not-
withstanding 
sections 
1902(a)(46)(B) 
and 
1137(d) and any differences in budget unit, dis-
regard, deeming or other methodology, if the fol-
lowing requirements are met: 
‘‘(I) PROHIBITION
ON
DETERMINING 
CHILDREN INELIGIBLE FOR COVERAGE.—If 
a finding from an Express Lane agency 
would result in a determination that a
109 
child does not satisfy an eligibility require-
ment for medical assistance under this title 
and for child health assistance under title 
XXI, the State shall determine eligibility for 
assistance using its regular procedures. 
‘‘(II) 
NOTICE
REQUIREMENT.—For 
any child who is found eligible for medical 
assistance under the State plan under this 
title or child health assistance under title 
XXI and who is subject to premiums based 
on an Express Lane agency’s finding of 
such child’s income level, the State shall 
provide notice that the child may qualify 
for lower premium payments if evaluated 
by the State using its regular policies and 
of the procedures for requesting such an 
evaluation. 
‘‘(III) COMPLIANCE WITH SCREEN AND 
ENROLL
REQUIREMENT.—The State shall 
satisfy the requirements under subpara-
graphs (A) and (B) of section 2102(b)(3) 
(relating to screen and enroll) before enroll-
ing a child in child health assistance under 
title XXI. At its option, the State may ful-
fill such requirements in accordance with
110 
either option provided under subparagraph 
(C) of this paragraph. 
‘‘(IV) VERIFICATION
OF
CITIZENSHIP 
OR NATIONALITY STATUS.—The State shall 
satisfy 
the 
requirements 
of 
section 
1902(a)(46)(B) or 2105(c)(10), as applica-
ble for verifications of citizenship or nation-
ality status. 
‘‘(V) CODING.—The State meets the re-
quirements of subparagraph (E). 
‘‘(ii) OPTION TO APPLY TO RENEWALS AND 
REDETERMINATIONS.—The State may apply the 
provisions of this paragraph when conducting 
initial determinations of eligibility, redetermina-
tions of eligibility, or both, as described in the 
State plan. 
‘‘(B) RULES
OF
CONSTRUCTION.—Nothing in 
this paragraph shall be construed— 
‘‘(i) to limit or prohibit a State from taking 
any actions otherwise permitted under this title 
or title XXI in determining eligibility for or en-
rolling children into medical assistance under 
this title or child health assistance under title 
XXI; or
111 
‘‘(ii) to modify the limitations in section 
1902(a)(5) concerning the agencies that may 
make a determination of eligibility for medical 
assistance under this title. 
‘‘(C) OPTIONS FOR SATISFYING THE SCREEN AND 
ENROLL REQUIREMENT.— 
‘‘(i) IN GENERAL.—With respect to a child 
whose eligibility for medical assistance under 
this title or for child health assistance under title 
XXI has been evaluated by a State agency using 
an income finding from an Express Lane agen-
cy, a State may carry out its duties under sub-
paragraphs (A) and (B) of section 2102(b)(3) 
(relating to screen and enroll) in accordance 
with either clause (ii) or clause (iii). 
‘‘(ii) ESTABLISHING A SCREENING THRESH-
OLD.— 
‘‘(I) IN GENERAL.—Under this clause, 
the State establishes a screening threshold 
set as a percentage of the Federal poverty 
level that exceeds the highest income thresh-
old applicable under this title to the child 
by a minimum of 30 percentage points or, 
at State option, a higher number of percent-
age points that reflects the value (as deter-
112 
mined by the State and described in the 
State plan) of any differences between in-
come methodologies used by the program ad-
ministered by the Express Lane agency and 
the methodologies used by the State in deter-
mining eligibility for medical assistance 
under this title. 
‘‘(II) CHILDREN
WITH
INCOME
NOT 
ABOVE
THRESHOLD.—If the income of a 
child does not exceed the screening threshold, 
the child is deemed to satisfy the income eli-
gibility criteria for medical assistance 
under this title regardless of whether such 
child would otherwise satisfy such criteria. 
‘‘(III) CHILDREN WITH INCOME ABOVE 
THRESHOLD.—If the income of a child ex-
ceeds the screening threshold, the child shall 
be considered to have an income above the 
Medicaid applicable income level described 
in section 2110(b)(4) and to satisfy the re-
quirement under section 2110(b)(1)(C) (re-
lating to the requirement that CHIP match-
ing funds be used only for children not eli-
gible for Medicaid). If such a child is en-
rolled in child health assistance under title
113 
XXI, the State shall provide the parent, 
guardian, or custodial relative with the fol-
lowing: 
‘‘(aa) Notice that the child may be 
eligible to receive medical assistance 
under the State plan under this title if 
evaluated for such assistance under the 
State’s regular procedures and notice 
of the process through which a parent, 
guardian, or custodial relative can re-
quest that the State evaluate the child’s 
eligibility for medical assistance under 
this title using such regular procedures. 
‘‘(bb) A description of differences 
between the medical assistance pro-
vided under this title and child health 
assistance under title XXI, including 
differences in cost-sharing requirements 
and covered benefits. 
‘‘(iii) TEMPORARY
ENROLLMENT
IN
CHIP 
PENDING SCREEN AND ENROLL.— 
‘‘(I) IN GENERAL.—Under this clause, 
a State enrolls a child in child health as-
sistance under title XXI for a temporary 
period if the child appears eligible for such
114 
assistance based on an income finding by 
an Express Lane agency. 
‘‘(II) 
DETERMINATION
OF
ELIGI-
BILITY.—During such temporary enrollment 
period, the State shall determine the child’s 
eligibility for child health assistance under 
title XXI or for medical assistance under 
this title in accordance with this clause. 
‘‘(III) PROMPT FOLLOW UP.—In mak-
ing such a determination, the State shall 
take prompt action to determine whether the 
child should be enrolled in medical assist-
ance under this title or child health assist-
ance under title XXI pursuant to subpara-
graphs (A) and (B) of section 2102(b)(3) 
(relating to screen and enroll). 
‘‘(IV) REQUIREMENT FOR SIMPLIFIED 
DETERMINATION.—In making such a deter-
mination, the State shall use procedures 
that, to the maximum feasible extent, reduce 
the burden imposed on the individual of 
such determination. Such procedures may 
not require the child’s parent, guardian, or 
custodial relative to provide or verify infor-
mation that already has been provided to
115 
the State agency by an Express Lane agen-
cy or another source of information unless 
the State agency has reason to believe the 
information is erroneous. 
‘‘(V) AVAILABILITY OF CHIP MATCHING 
FUNDS
DURING
TEMPORARY
ENROLLMENT 
PERIOD.—Medical assistance for items and 
services that are provided to a child enrolled 
in title XXI during a temporary enrollment 
period under this clause shall be treated as 
child health assistance under such title. 
‘‘(D) OPTION FOR AUTOMATIC ENROLLMENT.— 
‘‘(i) IN GENERAL.—The State may initiate 
and determine eligibility for medical assistance 
under the State Medicaid plan or for child 
health assistance under the State CHIP plan 
without a program application from, or on be-
half of, the child based on data obtained from 
sources other than the child (or the child’s fam-
ily), but a child can only be automatically en-
rolled in the State Medicaid plan or the State 
CHIP plan if the child or the family affirma-
tively consents to being enrolled through affirma-
tion and signature on an Express Lane agency
116 
application, if the requirement of clause (ii) is 
met. 
‘‘(ii) INFORMATION REQUIREMENT.—The re-
quirement of this clause is that the State informs 
the parent, guardian, or custodial relative of the 
child of the services that will be covered, appro-
priate methods for using such services, premium 
or other cost sharing charges (if any) that apply, 
medical support obligations (under section 
1912(a)) created by enrollment (if applicable), 
and the actions the parent, guardian, or relative 
must take to maintain enrollment and renew 
coverage. 
‘‘(E) CODING; APPLICATION
TO
ENROLLMENT 
ERROR RATES.— 
‘‘(i) IN
GENERAL.—For purposes of sub-
paragraph (A)(iv), the requirement of this sub-
paragraph for a State is that the State agrees 
to— 
‘‘(I) assign such codes as the Secretary 
shall require to the children who are en-
rolled in the State Medicaid plan or the 
State CHIP plan through reliance on a 
finding made by an Express Lane agency
117 
for the duration of the State’s election under 
this paragraph; 
‘‘(II) annually provide the Secretary 
with a statistically valid sample (that is 
approved by Secretary) of the children en-
rolled in such plans through reliance on 
such a finding by conducting a full Med-
icaid eligibility review of the children iden-
tified for such sample for purposes of deter-
mining an eligibility error rate (as de-
scribed in clause (iv)) with respect to the 
enrollment of such children (and shall not 
include such children in any data or sam-
ples used for purposes of complying with a 
Medicaid 
Eligibility 
Quality 
Control 
(MEQC) review or a payment error rate 
measurement (PERM) requirement); 
‘‘(III) submit the error rate determined 
under subclause (II) to the Secretary; 
‘‘(IV) if such error rate exceeds 3 per-
cent for either of the first 2 fiscal years in 
which the State elects to apply this para-
graph, demonstrate to the satisfaction of the 
Secretary the specific corrective actions im-
118 
plemented by the State to improve upon 
such error rate; and 
‘‘(V) if such error rate exceeds 3 per-
cent for any fiscal year in which the State 
elects to apply this paragraph, a reduction 
in the amount otherwise payable to the 
State under section 1903(a) for quarters for 
that fiscal year, equal to the total amount 
of erroneous excess payments determined for 
the fiscal year only with respect to the chil-
dren included in the sample for the fiscal 
year that are in excess of a 3 percent error 
rate with respect to such children. 
‘‘(ii) NO
PUNITIVE
ACTION
BASED
ON 
ERROR RATE.—The Secretary shall not apply the 
error rate derived from the sample under clause 
(i) to the entire population of children enrolled 
in the State Medicaid plan or the State CHIP 
plan through reliance on a finding made by an 
Express Lane agency, or to the population of 
children enrolled in such plans on the basis of 
the State’s regular procedures for determining 
eligibility, or penalize the State on the basis of 
such error rate in any manner other than the re-
119 
duction of payments provided for under clause 
(i)(V). 
‘‘(iii) RULE
OF
CONSTRUCTION.—Nothing 
in this paragraph shall be construed as relieving 
a State that elects to apply this paragraph from 
being subject to a penalty under section 1903(u), 
for payments made under the State Medicaid 
plan with respect to ineligible individuals and 
families that are determined to exceed the error 
rate permitted under that section (as determined 
without regard to the error rate determined 
under clause (i)(II)). 
‘‘(iv) ERROR RATE DEFINED.—In this sub-
paragraph, the term ‘error rate’ means the rate 
of erroneous excess payments for medical assist-
ance (as defined in section 1903(u)(1)(D)) for 
the period involved, except that such payments 
shall be limited to individuals for which eligi-
bility determinations are made under this para-
graph and except that in applying this para-
graph under title XXI, there shall be substituted 
for references to provisions of this title cor-
responding provisions within title XXI. 
‘‘(F) EXPRESS LANE AGENCY.—
120 
‘‘(i) IN GENERAL.—In this paragraph, the 
term ‘Express Lane agency’ means a public 
agency that— 
‘‘(I) is determined by the State Med-
icaid agency or the State CHIP agency (as 
applicable) to be capable of making the de-
terminations of one or more eligibility re-
quirements 
described 
in 
subparagraph 
(A)(i); 
‘‘(II) is identified in the State Med-
icaid plan or the State CHIP plan; and 
‘‘(III) notifies the child’s family— 
‘‘(aa) of the information which 
shall be disclosed in accordance with 
this paragraph; 
‘‘(bb) that the information dis-
closed will be used solely for purposes 
of determining eligibility for medical 
assistance under the State Medicaid 
plan or for child health assistance 
under the State CHIP plan; and 
‘‘(cc) that the family may elect to 
not have the information disclosed for 
such purposes; and
121 
‘‘(IV) enters into, or is subject to, an 
interagency agreement to limit the disclo-
sure and use of the information disclosed. 
‘‘(ii) INCLUSION OF SPECIFIC PUBLIC AGEN-
CIES.—Such term includes the following: 
‘‘(I) A public agency that determines 
eligibility for assistance under any of the 
following: 
‘‘(aa) The temporary assistance 
for needy families program funded 
under part A of title IV. 
‘‘(bb) A State program funded 
under part D of title IV. 
‘‘(cc) The State Medicaid plan. 
‘‘(dd) The State CHIP plan. 
‘‘(ee) The Food Stamp Act of 1977 
(7 U.S.C. 2011 et seq.). 
‘‘(ff) The Head Start Act (42 
U.S.C. 9801 et seq.). 
‘‘(gg) The Richard B. Russell Na-
tional School Lunch Act (42 U.S.C. 
1751 et seq.). 
‘‘(hh) The Child Nutrition Act of 
1966 (42 U.S.C. 1771 et seq.).
122 
‘‘(ii) The Child Care and Develop-
ment Block Grant Act of 1990 (42 
U.S.C. 9858 et seq.). 
‘‘(jj) The Stewart B. McKinney 
Homeless Assistance Act (42 U.S.C. 
11301 et seq.). 
‘‘(kk) The United States Housing 
Act of 1937 (42 U.S.C. 1437 et seq.). 
‘‘(ll) The Native American Hous-
ing Assistance and Self-Determination 
Act of 1996 (25 U.S.C. 4101 et seq.). 
‘‘(II) A State-specified governmental 
agency that has fiscal liability or legal re-
sponsibility for the accuracy of the eligi-
bility determination findings relied on by 
the State. 
‘‘(III) A public agency that is subject 
to an interagency agreement limiting the 
disclosure and use of the information dis-
closed for purposes of determining eligibility 
under the State Medicaid plan or the State 
CHIP plan. 
‘‘(iii) EXCLUSIONS.—Such term does not 
include an agency that determines eligibility for 
a program established under the Social Services
123 
Block Grant established under title XX or a pri-
vate, for-profit organization. 
‘‘(iv) RULES OF CONSTRUCTION.—Nothing 
in this paragraph shall be construed as— 
‘‘(I) exempting a State Medicaid agen-
cy from complying with the requirements of 
section 1902(a)(4) relating to merit-based 
personnel standards for employees of the 
State Medicaid agency and safeguards 
against conflicts of interest); or 
‘‘(II) authorizing a State Medicaid 
agency that elects to use Express Lane agen-
cies under this subparagraph to use the Ex-
press Lane option to avoid complying with 
such requirements for purposes of making 
eligibility determinations under the State 
Medicaid plan. 
‘‘(v) ADDITIONAL
DEFINITIONS.—In this 
paragraph: 
‘‘(I) STATE.—The term ‘State’ means 1 
of the 50 States or the District of Columbia. 
‘‘(II) STATE CHIP AGENCY.—The term 
‘State CHIP agency’ means the State agen-
cy responsible for administering the State 
CHIP plan.
124 
‘‘(III) STATE CHIP PLAN.—The term 
‘State CHIP plan’ means the State child 
health plan established under title XXI and 
includes any waiver of such plan. 
‘‘(IV) STATE MEDICAID AGENCY.—The 
term ‘State Medicaid agency’ means the 
State agency responsible for administering 
the State Medicaid plan. 
‘‘(V) STATE
MEDICAID
PLAN.—The 
term ‘State Medicaid plan’ means the State 
plan established under title XIX and in-
cludes any waiver of such plan. 
‘‘(G) CHILD
DEFINED.—For purposes of this 
paragraph, the term ‘child’ means an individual 
under 19 years of age, or, at the option of a State, 
such higher age, not to exceed 21 years of age, as the 
State may elect. 
‘‘(H) APPLICATION.—This paragraph shall not 
apply to with respect to eligibility determinations 
made after September 30, 2012.’’. 
(2) CHIP.—Section 2107(e)(1) (42 U.S.C. 
1397gg(e)(1)) is amended by redesignating subpara-
graphs (B), (C), and (D) as subparagraphs (C), (D), 
and (E), respectively, and by inserting after subpara-
graph (A) the following new subparagraph:
125 
‘‘(B) Section 1902(e)(13) (relating to the 
State option to rely on findings from an Express 
Lane agency to help evaluate a child’s eligibility 
for medical assistance).’’. 
(b) EVALUATION AND REPORT.— 
(1) EVALUATION.—The Secretary shall conduct, 
by grant, contract, or interagency agreement, a com-
prehensive, independent evaluation of the option pro-
vided under the amendments made by subsection (a). 
Such evaluation shall include an analysis of the effec-
tiveness of the option, and shall include— 
(A) obtaining a statistically valid sample of 
the children who were enrolled in the State Med-
icaid plan or the State CHIP plan through reli-
ance on a finding made by an Express Lane 
agency and determining the percentage of chil-
dren who were erroneously enrolled in such 
plans; 
(B) determining whether enrolling children 
in such plans through reliance on a finding 
made by an Express Lane agency improves the 
ability of a State to identify and enroll low-in-
come, uninsured children who are eligible but 
not enrolled in such plans;
126 
(C) evaluating the administrative costs or 
savings related to identifying and enrolling chil-
dren in such plans through reliance on such 
findings, and the extent to which such costs differ 
from the costs that the State otherwise would 
have incurred to identify and enroll low-income, 
uninsured children who are eligible but not en-
rolled in such plans; and 
(D) any recommendations for legislative or 
administrative changes that would improve the 
effectiveness of enrolling children in such plans 
through reliance on such findings. 
(2) REPORT TO CONGRESS.—Not later than Sep-
tember 30, 2011, the Secretary shall submit a report 
to Congress on the results of the evaluation under 
paragraph (1). 
(3) FUNDING.— 
(A) IN GENERAL.—Out of any funds in the 
Treasury not otherwise appropriated, there is 
appropriated to the Secretary to carry out the 
evaluation under this subsection $5,000,000 for 
the period of fiscal years 2008 through 2011. 
(B) BUDGET
AUTHORITY.—Subparagraph 
(A) constitutes budget authority in advance of 
appropriations Act and represents the obligation
127 
of the Federal Government to provide for the 
payment of such amount to conduct the evalua-
tion under this subsection. 
(c) ELECTRONIC TRANSMISSION OF INFORMATION.— 
Section 1902 (42 U.S.C. 1396a) is amended by adding at 
the end the following new subsection: 
‘‘(dd) ELECTRONIC
TRANSMISSION
OF
INFORMA-
TION.—If the State agency determining eligibility for med-
ical assistance under this title or child health assistance 
under title XXI verifies an element of eligibility based on 
information from an Express Lane Agency (as defined in 
subsection (e)(13)(F)), or from another public agency, then 
the applicant’s signature under penalty of perjury shall not 
be required as to such element. Any signature requirement 
for an application for medical assistance may be satisfied 
through an electronic signature, as defined in section 
1710(1) of the Government Paperwork Elimination Act (44 
U.S.C. 3504 note). The requirements of subparagraphs (A) 
and (B) of section 1137(d)(2) may be met through evidence 
in digital or electronic form.’’. 
(d) AUTHORIZATION OF INFORMATION DISCLOSURE.— 
(1) IN GENERAL.—Title XIX is amended— 
(A) by redesignating section 1939 as section 
1940; and
128 
(B) by inserting after section 1938 the fol-
lowing new section: 
‘‘SEC. 1939. AUTHORIZATION TO RECEIVE RELEVANT IN-
FORMATION. 
‘‘(a) IN GENERAL.—Notwithstanding any other provi-
sion of law, a Federal or State agency or private entity 
in possession of the sources of data directly relevant to eligi-
bility determinations under this title (including eligibility 
files maintained by Express Lane agencies described in sec-
tion 1902(e)(13)(F), information described in paragraph 
(2) or (3) of section 1137(a), vital records information 
about births in any State, and information described in 
sections 453(i) and 1902(a)(25)(I)) is authorized to convey 
such data or information to the State agency administering 
the State plan under this title, to the extent such conveyance 
meets the requirements of subsection (b). 
‘‘(b) REQUIREMENTS FOR CONVEYANCE.—Data or in-
formation may be conveyed pursuant to subsection (a) only 
if the following requirements are met: 
‘‘(1) The individual whose circumstances are de-
scribed in the data or information (or such individ-
ual’s parent, guardian, caretaker relative, or author-
ized representative) has either provided advance con-
sent to disclosure or has not objected to disclosure
129 
after receiving advance notice of disclosure and a rea-
sonable opportunity to object. 
‘‘(2) Such data or information are used solely for 
the purposes of— 
‘‘(A) identifying individuals who are eligi-
ble or potentially eligible for medical assistance 
under this title and enrolling or attempting to 
enroll such individuals in the State plan; and 
‘‘(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 otherwise 
meets applicable Federal requirements safe-
guarding privacy and data security; and 
‘‘(B) requires the State agency admin-
istering the State plan to use the data and infor-
mation obtained under this section to seek to en-
roll 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
130 
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 subsections (a) and (b) 
and the second sentence of subsection (f)) shall apply 
to a civil money penalty under this paragraph in the 
same manner as such 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:
131 
‘‘(F) Section 1939 (relating to authorization 
to receive data directly relevant to eligibility de-
terminations).’’. 
(3) CONFORMING AMENDMENT TO PROVIDE AC-
CESS TO DATA ABOUT ENROLLMENT IN INSURANCE 
FOR PURPOSES OF EVALUATING APPLICATIONS AND 
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 respect 
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 EXPRESS 
LANE OPTION TO RECEIVE CERTAIN DATA DIRECTLY REL-
EVANT
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 directly relevant 
to eligibility determinations and determining the correct
132 
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)). 
(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) STATE OPTION TO VERIFY DECLARATION OF CITI-
ZENSHIP OR NATIONALITY FOR PURPOSES OF ELIGIBILITY 
FOR MEDICAID THROUGH VERIFICATION OF NAME AND SO-
CIAL SECURITY NUMBER.— 
(1) ALTERNATIVE TO DOCUMENTATION REQUIRE-
MENT.— 
(A) IN GENERAL.—Section 1902 (42 U.S.C. 
1396a), as amended by section 203(c), is amend-
ed—
133 
(i) in subsection (a)(46)— 
(I) 
by 
inserting 
‘‘(A)’’ 
after 
‘‘(46)’’; 
(II) by adding ‘‘and’’ after the 
semicolon; and 
(III) by adding at the end the fol-
lowing 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 requirements 
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 nationality 
under section 1903(x) (if the individual is not described in 
paragraph (2) of that section), as follows:
134 
‘‘(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 
security number of the individual is invalid— 
‘‘(i) the State makes a reasonable effort to 
identify and address the causes of such invalid 
match, including through typographical or other 
clerical errors, by contacting the individual to 
confirm the accuracy of the name or social secu-
rity number, respectively, submitted, and by tak-
ing 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 effort; and 
‘‘(ii) in the case that the name or social se-
curity number of the individual remains invalid 
after such reasonable efforts, the State— 
‘‘(I) notifies the individual of such 
fact; 
‘‘(II) provides the individual with a 
period of 90 days from the date on which
135 
the notice required under subclause (I) is 
received by the individual to either present 
satisfactory documentary evidence of citi-
zenship or nationality (as defined in section 
1903(x)(3)) or cure the invalid determina-
tion with the Commissioner of Social Secu-
rity (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 invalid determination is not 
cured. 
‘‘(2)(A) Each State electing to satisfy the requirements 
of this subsection for purposes of section 1902(a)(46)(B) 
shall establish a program under which the State submits 
each month to the Commissioner of Social Security for 
verification the name and social security number of each 
individual newly enrolled in the State plan under this title 
that month who is not described in section 1903(x)(2). 
‘‘(B) In establishing the State program under this 
paragraph, the State may enter into an agreement with the 
Commissioner of Social Security—
139 
‘‘(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 mecha-
nized verification and information retrieval sys-
tems as the Secretary determines are necessary to 
implement section 1902(ee) (including 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’’. 
(2) LIMITATION ON WAIVER AUTHORITY.—Not-
withstanding any provision of section 1115 of the So-
cial Security Act (42 U.S.C. 1315), or any other pro-
vision of law, the Secretary may not waive the re-
140 
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)’’. 
(b) CLARIFICATION OF REQUIREMENTS RELATING TO 
PRESENTATION
OF SATISFACTORY DOCUMENTARY EVI-
DENCE OF CITIZENSHIP OR NATIONALITY.— 
(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-
141 
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 docu-
mentation, if appropriate) that the Secretary deter-
mines to be satisfactory documentary evidence of citi-
zenship or nationality for purposes of satisfying the 
requirement of this subsection.’’. 
(2) REQUIREMENT TO PROVIDE REASONABLE OP-
PORTUNITY
TO
PRESENT
SATISFACTORY
DOCUMEN-
TARY
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 docu-
mentary 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 documen-
tary evidence of citizenship or nationality under this sub-
142 
section 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 immigration sta-
tus.’’. 
(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; 
(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 indi-
vidual shall be deemed to have provided satisfactory 
documentary evidence of citizenship or nationality 
and shall not be required to provide further documen-
tary evidence on any date that occurs during or after
143 
the period in which the individual is eligible for med-
ical 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 requirement 
of section 1902(e)(4) that a child born in the United States 
to an alien mother for whom medical assistance for the de-
livery of such child is available as treatment of an emer-
gency medical condition pursuant to subsection (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 sentence: 
‘‘Notwithstanding the preceding sentence, in the 
case of a child who is born in the United States 
to an alien mother for whom medical assistance 
for the delivery of the child is made available 
pursuant to section 1903(v), the State imme-
diately shall issue a separate identification num-
ber for the child upon notification by the facility
144 
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)— 
(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 following new 
paragraph:
145 
‘‘(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 es-
tablishing 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 
section 1903(a)(3)(F) necessary to comply with 
subparagraph (A) shall in no event be less than 
90 percent and 75 percent, respectively.’’. 
(2) NONAPPLICATION
OF
ADMINISTRATIVE
EX-
PENDITURES CAP.—Section 2105(c)(2)(C) (42 U.S.C. 
1397ee(c)(2)(C)), as amended by section 202(b), is 
amended by adding at the end the following: 
‘‘(ii) EXPENDITURES TO COMPLY WITH 
CITIZENSHIP OR NATIONALITY VERIFICATION 
REQUIREMENTS.—Expenditures 
necessary 
for the State to comply with paragraph 
(9)(A).’’.
146 
(d) EFFECTIVE DATE.— 
(1) IN GENERAL.— 
(A) IN GENERAL.—Except as provided in 
subparagraph (B), the amendments made by this 
section shall take effect on October 1, 2008. 
(B) 
TECHNICAL
AMENDMENTS.—The 
amendments made by— 
(i) paragraphs (1), (2), and (3) of sub-
section (b) shall take effect as if included in 
the enactment of section 6036 of 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 assistance 
under a State Medicaid plan, including any waiver 
of such plan, solely as a result of the application of 
subsections (i)(22) and (x) of section 1903 of the So-
cial Security Act (as in effect during such period),
147 
but who would have been determined eligible for such 
assistance if such subsections, as amended by sub-
section (b), had applied to the individual, a State 
may deem the individual to be eligible for such assist-
ance as of the date that the individual was deter-
mined 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 
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 federally-recognized Indian tribe de-
scribed in subclause (II) of that section who presents 
a document described in subclause (I) of such section 
that is issued by such Indian tribe, shall be deemed 
to have presented satisfactory evidence of citizenship 
or nationality for purposes of satisfying the require-
ment 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
148 
(2) by inserting after paragraph (3) the fol-
lowing new paragraph: 
‘‘(4) REDUCTION OF ADMINISTRATIVE BARRIERS 
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-
ance under title XIX or for child health assist-
ance or health benefits coverage under this title. 
Such procedures shall be established and revised 
as often as the State determines appropriate to 
take into account the most recent information 
available to the State identifying such barriers. 
‘‘(B) DEEMED COMPLIANCE IF JOINT APPLI-
CATION AND RENEWAL PROCESS THAT PERMITS 
APPLICATION OTHER THAN IN PERSON.—A State 
shall be deemed to comply with subparagraph 
(A) if the State’s application and renewal forms 
and supplemental forms (if any) and informa-
tion verification process is the same for purposes 
of establishing and renewing eligibility for chil-
dren and pregnant women for medical assistance 
under title XIX and child health assistance
149 
under this title, and such process does not re-
quire 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 
(CHIP), not later than 18 months after the date of the en-
actment of this Act, the Secretary of Health and Human 
Services, in consultation with State Medicaid and CHIP 
directors and organizations representing program bene-
ficiaries, shall develop a model process for the coordination 
of the enrollment, retention, and coverage under such pro-
grams of children who, because of migration of families, 
emergency evacuations, natural or other disasters, public 
health emergencies, educational needs, or otherwise, fre-
quently change their State of residency or otherwise 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 additional 
steps or authority needed to make further improvements to 
coordinate the enrollment, retention, and coverage under 
CHIP and Medicaid of children described in subsection (a).
150 
TITLE III—REDUCING BARRIERS 
TO PROVIDING PREMIUM AS-
SISTANCE 
Subtitle A—Additional State Option 
for Providing Premium Assistance 
SEC. 301. ADDITIONAL STATE OPTION FOR PROVIDING PRE-
MIUM 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 accordance 
with the requirements of this paragraph. No sub-
sidy shall be provided to a targeted low-income 
child under this paragraph unless the child (or 
the child’s parent) voluntarily elects to receive
151 
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 
(but determined without regard to
152 
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 conjunction 
with a health savings account (as de-
fined 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 employee 
under qualified employer-sponsored coverage 
and the employee contribution required for 
enrollment of the employee and the child in
153 
such coverage, less any applicable premium 
cost-sharing applied under the State child 
health plan (subject to the limitations im-
posed under section 2103(e), including the 
requirement to count the total amount of the 
employee contribution required for enroll-
ment 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, sub-
ject to clause (iii), directly to the employee’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 employee. 
In the event of such a notification, an em-
ployer shall withhold the total amount of 
the employee contribution required for en-
rollment of the employee and the child in 
the qualified employer-sponsored coverage
154 
and the State shall pay the premium assist-
ance 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-
erage, supplemental coverage consisting of—
155 
‘‘(I) items or services that are not 
covered, or are only partially covered, 
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 IM-
POSED UNDER THE STATE.—Any waiting period 
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 provision 
of a premium assistance subsidy for the child 
under this paragraph. 
‘‘(G) 
OPT-OUT
PERMITTED
FOR
ANY 
MONTH.—A State shall establish a process for 
permitting the parent of a targeted low-income
156 
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 con-
tinuity 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-in-
come child in accordance with section 2111(b), 
the State may elect to offer a premium assistance 
subsidy to a parent of a targeted 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 employer-sponsored coverage, 
except that— 
‘‘(i) the amount of the premium assist-
ance subsidy shall be increased to take into 
account the cost of the enrollment of the 
parent in the qualified employer-sponsored 
coverage or, at the option of the State if the 
State determines it cost-effective, the cost of
157 
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 estab-
lish an employer-family premium assistance 
purchasing pool for employers with less 
than 250 employees who have at least 1 em-
ployee who is a pregnant woman eligible for 
assistance under the State child health plan 
(including through the application 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. 
‘‘(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
158 
that are health benefits coverage that is 
equivalent to the benefits coverage in a 
benchmark benefit package described in sec-
tion 2103(b) or benchmark-equivalent cov-
erage 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 construed as 
permitting payment under this section for 
administrative expenditures attributable to 
the establishment or operation of such pool, 
except to the extent that such payment 
would otherwise be permitted under this 
title. 
‘‘(J) NO EFFECT ON PREMIUM ASSISTANCE 
WAIVER PROGRAMS.—Nothing in this paragraph 
shall be construed as limiting the authority of a 
State to offer premium assistance under section 
1906 or 1906A, a waiver described in 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 Insur-
ance Program Reauthorization Act of 2007.
159 
‘‘(K) NOTICE OF AVAILABILITY.—If a State 
elects to provide premium assistance subsidies 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 targeted 
low-income children in qualified employer- 
sponsored coverage; 
‘‘(ii) provide, as part of the applica-
tion and enrollment process under the State 
child health plan, information describing 
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 ensure 
that parents are fully informed of the 
choices for receiving child health assistance 
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 coverage 
offered through an employer is certified by an
160 
actuary as health benefits coverage that is equiv-
alent to the benefits coverage in a benchmark 
benefit package described in section 2103(b) or 
benchmark-equivalent coverage that meets the re-
quirements of section 2103(a)(2), the State may 
provide premium assistance subsidies for enroll-
ment of targeted low-income children in such 
group health plan or health insurance coverage 
in the same manner as such subsidies are pro-
vided under this paragraph for enrollment in 
qualified employer-sponsored coverage, but with-
out regard to the requirement to provide supple-
mental 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 
qualified employer-sponsored coverage offered 
under this paragraph shall be deemed to meet the 
requirement of subparagraph (A) of paragraph 
(3).’’. 
(2) DETERMINATION
OF
COST-EFFECTIVENESS 
FOR PREMIUM ASSISTANCE OR PURCHASE OF FAMILY 
COVERAGE.—
161 
(A) IN
GENERAL.—Section 2105(c)(3)(A) 
(42 U.S.C. 1397ee(c)(3)(A)) is amended by strik-
ing ‘‘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 in-
volved 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, including ad-
ministrative expenditures, for providing 
coverage under such plan for all such chil-
dren 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 Sec-
retary under section 2105(c)(3) of the Social Se-
curity Act prior to the date of enactment of this 
Act.
162 
(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 subsection 
(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 cov-
erage if the State meets the requirements of this section. 
‘‘(b) QUALIFIED EMPLOYER-SPONSORED COVERAGE.— 
‘‘(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 In-
ternal Revenue Code of 1986 (but determined
163 
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 
‘‘(B) a high deductible health plan (as de-
fined 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 de-
fined under section 223(d) of such Code). 
‘‘(3) TREATMENT AS THIRD PARTY LIABILITY.— 
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 section, 
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 assistance sub-
sidies under this section shall be considered, for purposes 
of section 1903(a), to be a payment for medical assistance. 
‘‘(d) VOLUNTARY PARTICIPATION.—
164 
‘‘(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. 
‘‘(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 re-
ceipt of medical assistance. State may not require, as 
a condition of an individual under age 19 (or the in-
dividual’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 par-
ent 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
165 
19 (or the individual’s parent) in a premium assistance 
subsidy under this section for qualified employer-sponsored 
coverage, the State shall provide for payment of all enrollee 
premiums for enrollment in such coverage and all 
deductibles, coinsurance, and other cost-sharing obligations 
for items and services otherwise covered under the State 
plan under this title (exceeding the amount otherwise per-
mitted 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 individual’s (or par-
ent’s) eligibility for medical assistance under the State 
plan, except insofar as section 1902(a)(25) provides 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 Senate 
and the Committee on Energy and Commerce of the House 
of Representatives on the results of such study.
166 
SEC. 302. OUTREACH, EDUCATION, AND ENROLLMENT AS-
SISTANCE. 
(a) REQUIREMENT TO INCLUDE DESCRIPTION
OF 
OUTREACH, EDUCATION, AND ENROLLMENT EFFORTS RE-
LATED TO PREMIUM ASSISTANCE SUBSIDIES IN STATE 
CHILD
HEALTH
PLAN.—Section 2102(c) (42 U.S.C. 
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 accord-
ance with paragraph (2)(B), (3), or (10) of section 
2105(c), or a waiver approved under section 1115, 
outreach, education, and enrollment assistance for 
families of children likely to be eligible for such sub-
sidies, 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 spe-
cific, significant resources the State intends to apply 
to educate employers about the availability of pre-
mium assistance subsidies under the State child 
health plan.’’. 
(b) NONAPPLICATION OF 10 PERCENT LIMIT ON OUT-
REACH
AND CERTAIN OTHER EXPENDITURES.—Section 
2105(c)(2)(C) (42 U.S.C. 1397ee(c)(2)(C)), as amended by
167 
section 301(c)(2), is amended by adding at the end the fol-
lowing new clause: 
‘‘(iv) EXPENDITURES FOR OUTREACH 
TO INCREASE THE ENROLLMENT OF CHIL-
DREN UNDER THIS TITLE AND TITLE xix 
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 em-
ployers likely to provide qualified employer- 
sponsored coverage (as defined in subpara-
graph (B) of such paragraph), but not to 
exceed an amount equal to 1.25 percent of 
the maximum amount permitted to be ex-
pended under subparagraph (A) for items 
described in subsection (a)(1)(D).’’.
168 
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 de-
pendent is eligible, but not enrolled, for coverage 
under such terms) to enroll for coverage under 
the terms of the plan if either of the following 
conditions is met: 
‘‘(i) TERMINATION
OF
MEDICAID
OR 
CHIP COVERAGE.—The employee or depend-
ent is covered under a Medicaid plan under
169 
title XIX of the Social Security Act or 
under a State child health plan under title 
XXI of such Act and coverage of the em-
ployee or dependent under such a plan is 
terminated as a result of loss of eligibility 
for such coverage and the employee requests 
coverage under the group health plan not 
later than 60 days after the date of termi-
nation of such coverage. 
‘‘(ii) ELIGIBILITY
FOR
EMPLOYMENT 
ASSISTANCE UNDER MEDICAID OR CHIP.— 
The employee or dependent becomes eligible 
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 eli-
gible for such assistance. 
‘‘(B) EMPLOYEE
OUTREACH
AND
DISCLO-
SURE.—
170 
‘‘(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 writ-
ten notice informing the employee of 
potential opportunities then currently 
available in the State in which the em-
ployee resides for premium assistance 
under such plans for health coverage of 
the employee or the employee’s depend-
ents. For purposes of compliance with 
this clause, the employer may use any 
State-specific model notice developed in 
accordance 
with 
section 
701(f)(3)(B)(i)(II) of the Employee Re-
171 
tirement 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, con-
current with materials provided to the 
employee in connection with an open 
season or election process conducted 
under the plan, or concurrent with the 
furnishing of the summary plan de-
scription 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 bene-
ficiary of a group health plan who is cov-
ered under a Medicaid plan of a State 
under title XIX of the Social Security Act
172 
or under a State child health plan under 
title XXI of such Act, the plan adminis-
trator of the group health plan shall disclose 
to the State, upon request, information 
about the benefits available under the group 
health plan in sufficient specificity, as de-
termined under regulations of the Secretary 
of Health and Human Services in consulta-
tion with the Secretary that require use of 
the model coverage coordination disclosure 
form developed under section 311(b)(1)(C) 
of the Children’s Health Insurance Program 
Reauthorization Act of 2007, so as to per-
mit the State to make a determination 
(under paragraph (2)(B), (3), or (10) of 
section 2105(c) of the Social Security Act or 
otherwise) concerning the cost-effectiveness 
of the State providing medical or child 
health assistance through premium assist-
ance for the purchase of coverage under such 
group health plan and in order for the 
State to provide supplemental benefits re-
quired under paragraph (10)(E) of such sec-
tion or other authority.’’. 
(b) CONFORMING AMENDMENTS.—
173 
(1) AMENDMENTS
TO
EMPLOYEE
RETIREMENT 
INCOME SECURITY ACT.— 
(A) IN
GENERAL.—Section 701(f) of the 
Employee Retirement Income Security Act of 
1974 (29 U.S.C. 1181(f)) is amended by adding 
at the end the following new paragraph: 
‘‘(3) SPECIAL RULES FOR APPLICATION IN CASE 
OF MEDICAID AND CHIP.— 
‘‘(A) IN GENERAL.—A group health plan, 
and a health insurance issuer offering group 
health insurance coverage in connection with 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 en-
rolled, for coverage under such terms) to enroll 
for coverage under the terms of the plan if either 
of the following conditions is met: 
‘‘(i) TERMINATION
OF
MEDICAID
OR 
CHIP COVERAGE.—The employee or depend-
ent is covered under a Medicaid plan 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 em-
ployee or dependent under such a plan is
174 
terminated as a result of loss of eligibility 
for such coverage and the employee requests 
coverage under the group health plan (or 
health insurance coverage) 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 eligible 
for assistance, with respect to coverage 
under the group health plan or health in-
surance coverage, under such Medicaid plan 
or State child health plan (including under 
any waiver or demonstration project con-
ducted under or in relation to such a plan), 
if the employee requests coverage under the 
group health plan or health insurance cov-
erage not later than 60 days after the date 
the employee or dependent is determined to 
be eligible for such assistance. 
‘‘(B) COORDINATION WITH MEDICAID AND 
CHIP.— 
‘‘(i) OUTREACH
TO
EMPLOYEES
RE-
GARDING AVAILABILITY OF MEDICAID AND 
CHIP COVERAGE.—
175 
‘‘(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 writ-
ten notice informing the employee of 
potential opportunities then currently 
available in the State in which the em-
ployee resides for premium assistance 
under such plans for health coverage of 
the employee or the employee’s depend-
ents. 
‘‘(II) MODEL NOTICE.—Not later 
than 1 year after the date of enactment 
of the Children’s Health Insurance 
Program Reauthorization Act of 2007, 
the Secretary and the Secretary of 
Health and Human Services, in con-
sultation with Directors of State Med-
176 
icaid agencies under title XIX of the 
Social Security Act and Directors of 
State CHIP agencies under title XXI 
of such Act, shall jointly develop na-
tional and State-specific model notices 
for purposes of subparagraph (A). The 
Secretary shall provide employers with 
such model notices so as to enable em-
ployers to timely comply with the re-
quirements of subparagraph (A). Such 
model notices shall include information 
regarding how an employee may con-
tact the State in which the employee 
resides for additional information re-
garding potential opportunities for 
such premium assistance, including 
how to apply for such assistance. 
‘‘(III) 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, con-
177 
current with materials provided to the 
employee in connection with an open 
season or election process conducted 
under the plan, or concurrent with the 
furnishing of the summary plan de-
scription as provided in section 104(b). 
‘‘(ii) 
DISCLOSURE
ABOUT
GROUP 
HEALTH
PLAN
BENEFITS
TO
STATES
FOR 
MEDICAID
AND
CHIP
ELIGIBLE
INDIVID-
UALS.—In the case of a participant or bene-
ficiary of a group health plan who is cov-
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 disclose 
to the State, upon request, information 
about the benefits available under the group 
health plan in sufficient specificity, as de-
termined under regulations of the Secretary 
of Health and Human Services in consulta-
tion with the Secretary that require use of 
the model coverage coordination disclosure 
form developed under section 311(b)(1)(C) 
of the Children’s Health Insurance Program
178 
Reauthorization Act of 2007, so as to per-
mit the State to make a determination 
(under paragraph (2)(B), (3), or (10) of 
section 2105(c) of the Social Security Act or 
otherwise) concerning the cost-effectiveness 
of the State providing medical or child 
health assistance through premium assist-
ance for the purchase of coverage under such 
group health plan and in order for the 
State to provide supplemental benefits re-
quired under paragraph (10)(E) of such sec-
tion or other authority.’’. 
(B) 
CONFORMING
AMENDMENT.—Section 
102(b) of the Employee Retirement Income Secu-
rity Act of 1974 (29 U.S.C. 1022(b)) is amend-
ed— 
(i) by striking ‘‘and the remedies’’ and 
inserting ‘‘, the remedies’’; and 
(ii) by inserting before the period the 
following: ‘‘, and if the employer so elects 
for purposes of complying with section 
701(f)(3)(B)(i), the model notice applicable 
to the State in which the participants and 
beneficiaries reside’’.
179 
(C) WORKING GROUP TO DEVELOP MODEL 
COVERAGE COORDINATION DISCLOSURE FORM.— 
(i) MEDICAID, CHIP, AND EMPLOYER- 
SPONSORED
COVERAGE
COORDINATION 
WORKING GROUP.— 
(I) IN GENERAL.—Not later than 
60 days after the date of enactment of 
this Act, the Secretary of Health and 
Human Services and the Secretary of 
Labor shall jointly establish a Med-
icaid, CHIP, and Employer-Sponsored 
Coverage Coordination Working Group 
(in this subparagraph referred to as 
the ‘‘Working Group’’). The purpose of 
the Working Group shall be to develop 
the model coverage coordination disclo-
sure form described in subclause (II) 
and to identify the impediments to the 
effective coordination of coverage avail-
able to families that include employees 
of employers that maintain group 
health plans and members who are eli-
gible for medical assistance under title 
XIX of the Social Security Act or child 
health assistance or other health bene-
180 
fits coverage under title XXI of such 
Act. 
(II) MODEL COVERAGE COORDINA-
TION DISCLOSURE FORM DESCRIBED.— 
The model form described in this sub-
clause is a form for plan administra-
tors of group health plans to complete 
for purposes of permitting a State to 
determine the availability and cost-ef-
fectiveness of the coverage available 
under such plans to employees who 
have family members who are eligible 
for premium assistance offered under a 
State plan under title XIX or XXI of 
such Act and to allow for coordination 
of coverage for enrollees of such plans. 
Such form shall provide the following 
information in addition to such other 
information as the Working Group de-
termines appropriate: 
(aa) 
A 
determination 
of 
whether the employee is eligible 
for coverage under the group 
health plan.
181 
(bb) The name and contract 
information of the plan adminis-
trator of the group health plan. 
(cc) 
The 
benefits 
offered 
under the plan. 
(dd) The premiums and cost- 
sharing required under the plan. 
(ee) Any other information 
relevant to coverage under the 
plan. 
(ii) 
MEMBERSHIP.—The 
Working 
Group shall consist of not more than 30 
members and shall be composed of rep-
resentatives of— 
(I) the Department of Labor; 
(II) the Department of Health 
and Human Services; 
(III) State directors of the Med-
icaid program under title XIX of the 
Social Security Act; 
(IV) State directors of the State 
Children’s Health Insurance Program 
under title XXI of the Social Security 
Act;
183 
to the Working Group, including technical 
assistance. The Working Group may use the 
services and facilities of either such Depart-
ment, with or without reimbursement, as 
jointly determined by such Departments. 
(v) REPORT.— 
(I) REPORT BY WORKING GROUP 
TO THE SECRETARIES.—Not later than 
18 months after the date of the enact-
ment of this Act, the Working Group 
shall submit to the Secretary of Labor 
and the Secretary of Health and 
Human Services the model form de-
scribed in clause (i)(II) along with a 
report containing recommendations for 
appropriate measures to address the 
impediments to the effective coordina-
tion of coverage between group health 
plans and the State plans under titles 
XIX and XXI of the Social Security 
Act. 
(II) REPORT BY SECRETARIES TO 
THE
CONGRESS.—Not later than 2 
months after receipt of the report pur-
suant to subclause (I), the Secretaries
184 
shall jointly submit a report to each 
House of the Congress regarding the 
recommendations contained in the re-
port under such subclause. 
(vi) 
TERMINATION.—The 
Working 
Group shall terminate 30 days after the 
date of the issuance of its report under 
clause (v). 
(D) EFFECTIVE DATES.—The Secretary of 
Labor and the Secretary of Health and Human 
Services shall develop the initial model notices 
under section 701(f)(3)(B)(i)(II) of the Employee 
Retirement Income Security Act of 1974, and the 
Secretary of Labor shall provide such notices to 
employers, not later than the date that is 1 year 
after the date of enactment of this Act, and each 
employer shall provide the initial annual notices 
to such employer’s employees beginning with the 
first plan year that begins after the date on 
which such initial model notices are first issued. 
The model coverage coordination disclosure form 
developed under subparagraph (C) shall apply 
with respect to requests made by States begin-
ning with the first plan year that begins after
185 
the date on which such model coverage coordina-
tion disclosure form is first issued. 
(E) ENFORCEMENT.—Section 502 of the 
Employee Retirement Income Security Act of 
1974 (29 U.S.C. 1132) is amended— 
(i) in subsection (a)(6), by striking ‘‘or 
(8)’’ and inserting ‘‘(8), or (9)’’; and 
(ii) in subsection (c), by redesignating 
paragraph (9) as paragraph (10), and by 
inserting after paragraph (8) the following: 
‘‘(9)(A) The Secretary may assess a civil penalty 
against any employer of up to $100 a day from the date 
of the employer’s failure to meet the notice requirement of 
section 701(f)(3)(B)(i)(I). For purposes of this subpara-
graph, each violation with respect to any single employee 
shall be treated as a separate violation. 
‘‘(B) The Secretary may assess a civil penalty against 
any plan administrator of up to $100 a day from the date 
of the plan administrator’s failure to timely provide to any 
State the information required to be disclosed under section 
701(f)(3)(B)(ii). For purposes of this subparagraph, each 
violation with respect to any single participant or bene-
ficiary shall be treated as a separate violation.’’. 
(2) AMENDMENTS TO PUBLIC HEALTH SERVICE 
ACT.—Section 2701(f) of the Public Health Service
186 
Act (42 U.S.C. 300gg(f)) is amended by adding at the 
end the following new paragraph: 
‘‘(3) SPECIAL RULES FOR APPLICATION IN CASE 
OF MEDICAID AND CHIP.— 
‘‘(A) IN GENERAL.—A group health plan, 
and a health insurance issuer offering group 
health insurance coverage in connection with 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 en-
rolled, for coverage under such terms) to enroll 
for coverage under the terms of the plan if either 
of the following conditions is met: 
‘‘(i) TERMINATION
OF
MEDICAID
OR 
CHIP COVERAGE.—The employee or depend-
ent is covered under a Medicaid plan 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 em-
ployee or dependent under such a plan is 
terminated as a result of loss of eligibility 
for such coverage and the employee requests 
coverage under the group health plan (or 
health insurance coverage) not later than 60
187 
days after the date of termination of such 
coverage. 
‘‘(ii) ELIGIBILITY
FOR
EMPLOYMENT 
ASSISTANCE UNDER MEDICAID OR CHIP.— 
The employee or dependent becomes eligible 
for assistance, with respect to coverage 
under the group health plan or health in-
surance coverage, under such Medicaid plan 
or State child health plan (including under 
any waiver or demonstration project con-
ducted under or in relation to such a plan), 
if the employee requests coverage under the 
group health plan or health insurance cov-
erage not later than 60 days after the date 
the employee or dependent is determined to 
be eligible for such assistance. 
‘‘(B) COORDINATION WITH MEDICAID AND 
CHIP.— 
‘‘(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
188 
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 writ-
ten notice informing the employee of 
potential opportunities then currently 
available in the State in which the em-
ployee resides for premium assistance 
under such plans for health coverage of 
the employee or the employee’s depend-
ents. For purposes of compliance with 
this subclause, the employer may use 
any State-specific model notice devel-
oped 
in 
accordance 
with 
section 
701(f)(3)(B)(i)(II) of the Employee Re-
tirement 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
189 
employee resides concurrent with the 
furnishing of materials notifying the 
employee of health plan eligibility, con-
current with materials provided to the 
employee in connection with an open 
season or election process conducted 
under the plan, or concurrent with the 
furnishing of the summary plan de-
scription as provided in section 104(b) 
of the Employee Retirement Income 
Security Act of 1974. 
‘‘(ii) 
DISCLOSURE
ABOUT
GROUP 
HEALTH
PLAN
BENEFITS
TO
STATES
FOR 
MEDICAID
AND
CHIP
ELIGIBLE
INDIVID-
UALS.—In the case of an enrollee in a 
group health plan who is covered 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 administrator of the group 
health plan shall disclose to the State, upon 
request, information about the benefits 
available under the group health plan in 
sufficient specificity, as determined under 
regulations of the Secretary of Health and
190 
Human Services in consultation with the 
Secretary that require use of the model cov-
erage coordination disclosure form developed 
under section 311(b)(1)(C) of the Children’s 
Health Insurance 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 Social 
Security Act or otherwise) concerning the 
cost-effectiveness of the State providing med-
ical or child health assistance through pre-
mium assistance for the purchase of cov-
erage under such group health plan and in 
order for the State to provide supplemental 
benefits required under paragraph (10)(E) 
of such section or other authority.’’. 
TITLE 
IV—STRENGTHENING 
QUALITY 
OF 
CARE 
AND 
HEALTH OUTCOMES 
SEC. 401. CHILD HEALTH QUALITY IMPROVEMENT ACTIVI-
TIES FOR CHILDREN ENROLLED IN MEDICAID 
OR CHIP. 
(a) DEVELOPMENT
OF
CHILD
HEALTH
QUALITY 
MEASURES FOR CHILDREN ENROLLED IN MEDICAID OR
191 
CHIP.—Title XI (42 U.S.C. 1301 et seq.) is amended by 
inserting after section 1139 the following new section: 
‘‘SEC. 1139A. CHILD HEALTH QUALITY MEASURES. 
‘‘(a) DEVELOPMENT OF AN INITIAL CORE SET OF 
HEALTH CARE QUALITY MEASURES FOR CHILDREN EN-
ROLLED IN MEDICAID OR CHIP.— 
‘‘(1) IN GENERAL.—Not later than January 1, 
2009, the Secretary shall identify and publish for gen-
eral comment an initial, recommended core set of 
child health quality measures for use by State pro-
grams administered under titles XIX and XXI, health 
insurance issuers and managed care entities that 
enter into contracts with such programs, and pro-
viders of items and services under such programs. 
‘‘(2) IDENTIFICATION
OF
INITIAL
CORE
MEAS-
URES.—In consultation with the individuals and en-
tities described in subsection (b)(3), the Secretary 
shall identify existing quality of care measures for 
children that are in use under public and privately 
sponsored health care coverage arrangements, or that 
are part of reporting systems that measure both the 
presence and duration of health insurance coverage 
over time. 
‘‘(3) RECOMMENDATIONS AND DISSEMINATION.— 
Based on such existing and identified measures, the
192 
Secretary shall publish an initial core set of child 
health quality measures that includes (but is not lim-
ited to) the following: 
‘‘(A) The duration of children’s health in-
surance coverage over a 12-month time period. 
‘‘(B) The availability and effectiveness of a 
full range of— 
‘‘(i) preventive services, treatments, 
and services for acute conditions, including 
services to promote healthy birth, prevent 
and treat premature birth, and detect the 
presence or risk of physical or mental con-
ditions that could adversely affect growth 
and development; and 
‘‘(ii) treatments to correct or amelio-
rate the effects of physical and mental con-
ditions, including chronic conditions, in in-
fants, young children, school-age children, 
and adolescents. 
‘‘(C) The availability of care in a range of 
ambulatory and inpatient health care settings in 
which such care is furnished. 
‘‘(D) The types of measures that, taken to-
gether, can be used to estimate the overall na-
tional quality of health care for children, includ-
193 
ing children with special needs, and to perform 
comparative analyses of pediatric health care 
quality and racial, ethnic, and socioeconomic 
disparities in child health and health care for 
children. 
‘‘(4) ENCOURAGE
VOLUNTARY
AND
STANDARD-
IZED REPORTING.—Not later than 2 years after the 
date of enactment of the Children’s Health Insurance 
Program Reauthorization Act of 2007, the Secretary, 
in consultation with States, shall develop a standard-
ized format for reporting information and procedures 
and approaches that encourage States to use the ini-
tial core measurement set to voluntarily report infor-
mation regarding the quality of pediatric health care 
under titles XIX and XXI. 
‘‘(5) ADOPTION OF BEST PRACTICES IN IMPLE-
MENTING QUALITY PROGRAMS.—The Secretary shall 
disseminate information to States regarding best 
practices among States with respect to measuring and 
reporting on the quality of health care for children, 
and shall facilitate the adoption of such best prac-
tices. In developing best practices approaches, the Sec-
retary shall give particular attention to State meas-
urement techniques that ensure the timeliness and ac-
curacy of provider reporting, encourage provider re-
194 
porting compliance, encourage successful quality im-
provement strategies, and improve efficiency in data 
collection using health information technology. 
‘‘(6) REPORTS TO CONGRESS.—Not later than 
January 1, 2010, and every 3 years thereafter, the 
Secretary shall report to Congress on— 
‘‘(A) the status of the Secretary’s efforts to 
improve— 
‘‘(i) quality related to the duration 
and stability of health insurance coverage 
for children under titles XIX and XXI; 
‘‘(ii) the quality of children’s health 
care under such titles, including preventive 
health services, health care for acute condi-
tions, chronic health care, and health serv-
ices to ameliorate the effects of physical and 
mental conditions and to aid in growth and 
development of infants, young children, 
school-age children, and adolescents with 
special health care needs; and 
‘‘(iii) the quality of children’s health 
care under such titles across the domains of 
quality, including clinical quality, health 
care safety, family experience with health 
care, health care in the most integrated set-
195 
ting, and elimination of racial, ethnic, and 
socioeconomic disparities in health and 
health care; 
‘‘(B) the status of voluntary reporting by 
States under titles XIX and XXI, utilizing the 
initial core quality measurement set; and 
‘‘(C) any recommendations for legislative 
changes needed to improve the quality of care 
provided to children under titles XIX and XXI, 
including recommendations for quality reporting 
by States. 
‘‘(7) TECHNICAL
ASSISTANCE.—The Secretary 
shall provide technical assistance to States to assist 
them in adopting and utilizing core child health qual-
ity measures in administering the State plans under 
titles XIX and XXI. 
‘‘(8) DEFINITION OF CORE SET.—In this section, 
the term ‘core set’ means a group of valid, reliable, 
and evidence-based quality measures that, taken to-
gether— 
‘‘(A) provide information regarding the 
quality of health coverage and health care for 
children; 
‘‘(B) address the needs of children through-
out the developmental age span; and
196 
‘‘(C) allow purchasers, families, and health 
care providers to understand the quality of care 
in relation to the preventive needs of children, 
treatments aimed at managing and resolving 
acute conditions, and diagnostic and treatment 
services whose purpose is to correct or ameliorate 
physical, mental, or developmental conditions 
that could, if untreated or poorly treated, become 
chronic. 
‘‘(b) ADVANCING AND IMPROVING PEDIATRIC QUALITY 
MEASURES.— 
‘‘(1) ESTABLISHMENT
OF
PEDIATRIC
QUALITY 
MEASURES
PROGRAM.—Not later than January 1, 
2010, the Secretary shall establish a pediatric quality 
measures program to— 
‘‘(A) improve and strengthen the initial 
core child health care quality measures estab-
lished by the Secretary under subsection (a); 
‘‘(B) expand on existing pediatric quality 
measures used by public and private health care 
purchasers and advance the development of such 
new and emerging quality measures; and 
‘‘(C) increase the portfolio of evidence-based, 
consensus pediatric quality measures available to
197 
public and private purchasers of children’s 
health care services, providers, and consumers. 
‘‘(2) EVIDENCE-BASED
MEASURES.—The meas-
ures developed under the pediatric quality measures 
program shall, at a minimum, be— 
‘‘(A) evidence-based and, where appropriate, 
risk adjusted; 
‘‘(B) designed to identify and eliminate ra-
cial and ethnic disparities in child health and 
the provision of health care; 
‘‘(C) designed to ensure that the data re-
quired for such measures is collected and re-
ported in a standard format that permits com-
parison of quality and data at a State, plan, 
and provider level; 
‘‘(D) periodically updated; and 
‘‘(E) responsive to the child health needs, 
services, and domains of health care quality de-
scribed in clauses (i), (ii), and (iii) of subsection 
(a)(6)(A). 
‘‘(3) PROCESS FOR PEDIATRIC QUALITY MEAS-
URES PROGRAM.—In identifying gaps in existing pe-
diatric quality measures and establishing priorities 
for development and advancement of such measures, 
the Secretary shall consult with—
198 
‘‘(A) States; 
‘‘(B) pediatricians, children’s hospitals, and 
other primary and specialized pediatric health 
care professionals (including members of the al-
lied health professions) who specialize in the care 
and treatment of children, particularly children 
with special physical, mental, and developmental 
health care needs; 
‘‘(C) dental professionals, including pedi-
atric dental professionals; 
‘‘(D) health care providers that furnish pri-
mary health care to children and families who 
live in urban and rural medically underserved 
communities or who are members of distinct 
population sub-groups at heightened risk for 
poor health outcomes; 
‘‘(E) national organizations representing 
children, including children with disabilities and 
children with chronic conditions; 
‘‘(F) national organizations representing 
consumers and purchasers of children’s health 
care; 
‘‘(G) national organizations and individ-
uals with expertise in pediatric health quality 
measurement; and
199 
‘‘(H) voluntary consensus standards setting 
organizations and other organizations involved 
in the advancement of evidence-based measures of 
health care. 
‘‘(4) DEVELOPING, VALIDATING, AND TESTING A 
PORTFOLIO OF PEDIATRIC QUALITY MEASURES.—As 
part of the program to advance pediatric quality 
measures, the Secretary shall— 
‘‘(A) award grants and contracts for the de-
velopment, testing, and validation of new, emerg-
ing, and innovative evidence-based measures for 
children’s health care services across the domains 
of quality described in clauses (i), (ii), and (iii) 
of subsection (a)(6)(A); and 
‘‘(B) award grants and contracts for— 
‘‘(i) the development of consensus on 
evidence-based 
measures 
for 
children’s 
health care services; 
‘‘(ii) the dissemination of such meas-
ures to public and private purchasers of 
health care for children; and 
‘‘(iii) the updating of such measures as 
necessary. 
‘‘(5) REVISING, STRENGTHENING, AND IMPROV-
ING INITIAL CORE MEASURES.—Beginning no later
200 
than January 1, 2012, and annually thereafter, the 
Secretary shall publish recommended changes to the 
core measures described in subsection (a) that shall 
reflect the testing, validation, and consensus process 
for the development of pediatric quality measures de-
scribed in subsection paragraphs (1) through (4). 
‘‘(6) DEFINITION OF PEDIATRIC QUALITY MEAS-
URE.—In this subsection, the term ‘pediatric quality 
measure’ means a measurement of clinical care that 
is capable of being examined through the collection 
and analysis of relevant information, that is devel-
oped in order to assess 1 or more aspects of pediatric 
health care quality in various institutional and am-
bulatory health care settings, including the structure 
of the clinical care system, the process of care, the out-
come of care, or patient experiences in care. 
‘‘(7) CONSTRUCTION.—Nothing in this section 
shall be construed as supporting the restriction of cov-
erage, under title XIX or XXI or otherwise, to only 
those services that are evidence-based. 
‘‘(c) ANNUAL STATE REPORTS REGARDING STATE- 
SPECIFIC QUALITY OF CARE MEASURES APPLIED UNDER 
MEDICAID OR CHIP.— 
‘‘(1) ANNUAL STATE REPORTS.—Each State with 
a State plan approved under title XIX or a State
201 
child health plan approved under title XXI shall an-
nually report to the Secretary on the— 
‘‘(A) State-specific child health quality 
measures applied by the States under such plans, 
including measures described in subparagraphs 
(A) and (B) of subsection (a)(6); and 
‘‘(B) State-specific information on the qual-
ity of health care furnished to children under 
such plans, including information collected 
through external quality reviews of managed care 
organizations under section 1932 of the Social 
Security Act (42 U.S.C. 1396u–4) and bench-
mark plans under sections 1937 and 2103 of 
such Act (42 U.S.C. 1396u–7, 1397cc). 
‘‘(2) PUBLICATION.—Not later than September 
30, 2009, and annually thereafter, the Secretary shall 
collect, analyze, and make publicly available the in-
formation reported by States under paragraph (1). 
‘‘(d) DEMONSTRATION PROJECTS FOR IMPROVING THE 
QUALITY OF CHILDREN’S HEALTH CARE AND THE USE OF 
HEALTH INFORMATION TECHNOLOGY.— 
‘‘(1) IN GENERAL.—During the period of fiscal 
years 2008 through 2012, the Secretary shall award 
not more than 10 grants to States and child health 
providers to conduct demonstration projects to evalu-
202 
ate promising ideas for improving the quality of chil-
dren’s health care provided under title XIX or XXI, 
including projects to— 
‘‘(A) experiment with, and evaluate the use 
of, new measures of the quality of children’s 
health care under such titles (including testing 
the validity and suitability for reporting of such 
measures); 
‘‘(B) promote the use of health information 
technology in care delivery for children under 
such titles; 
‘‘(C) evaluate provider-based models which 
improve the delivery of children’s health care 
services under such titles, including care man-
agement for children with chronic conditions and 
the use of evidence-based approaches to improve 
the effectiveness, safety, and efficiency of health 
care services for children; or 
‘‘(D) demonstrate the impact of the model 
electronic health record format for children devel-
oped and disseminated under subsection (f) on 
improving pediatric health, including the effects 
of chronic childhood health conditions, and pedi-
atric health care quality as well as reducing 
health care costs.
203 
‘‘(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 conducted on 
a multistate basis, as needed. 
‘‘(4) FUNDING.—$20,000,000 of the amount ap-
propriated 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 de-
velop a comprehensive and systematic model for re-
ducing childhood obesity by awarding grants to eligi-
204 
ble entities to carry out such project. Such model 
shall— 
‘‘(A) identify, through self-assessment, be-
havioral risk factors for obesity among children; 
‘‘(B) identify, through self-assessment, need-
ed clinical preventive and screening benefits 
among those children identified as target indi-
viduals on the basis of such risk factors; 
‘‘(C) provide ongoing support to such target 
individuals and their families to reduce risk fac-
tors and promote the appropriate use of preven-
tive and screening benefits; and 
‘‘(D) be designed to improve health out-
comes, satisfaction, quality of life, and appro-
priate use of items and services for which med-
ical assistance is available under title XIX or 
child health assistance is available under title 
XXI among such target individuals. 
‘‘(2) ELIGIBILITY
ENTITIES.—For purposes of 
this subsection, an eligible entity is any of the fol-
lowing: 
‘‘(A) A city, county, or Indian tribe. 
‘‘(B) A local or tribal educational agency. 
‘‘(C) An accredited university, college, or 
community college.
205 
‘‘(D) A Federally-qualified health center. 
‘‘(E) A local health department. 
‘‘(F) A health care provider. 
‘‘(G) A community-based organization. 
‘‘(H) Any other entity determined appro-
priate by the Secretary, including a consortia or 
partnership of entities described in any of sub-
paragraphs (A) through (G). 
‘‘(3) USE OF FUNDS.—An eligible entity award-
ed a grant under this subsection shall use the funds 
made available under the grant to— 
‘‘(A) carry out community-based activities 
related to reducing childhood obesity, including 
by— 
‘‘(i) forming partnerships with entities, 
including schools and other facilities pro-
viding recreational services, to establish 
programs for after school and weekend com-
munity activities that are designed to re-
duce childhood obesity; 
‘‘(ii) 
forming 
partnerships 
with 
daycare facilities to establish programs that 
promote healthy eating behaviors and phys-
ical activity; and
206 
‘‘(iii) developing and evaluating com-
munity educational activities targeting good 
nutrition and promoting healthy eating be-
haviors; 
‘‘(B) carry out age-appropriate school-based 
activities that are designed to reduce childhood 
obesity, including by— 
‘‘(i) developing and testing educational 
curricula and intervention programs de-
signed to promote healthy eating behaviors 
and habits in youth, which may include— 
‘‘(I) after hours physical activity 
programs; and 
‘‘(II) science-based interventions 
with multiple components to prevent 
eating disorders including nutritional 
content, understanding and responding 
to hunger and satiety, positive body 
image development, positive self-esteem 
development, and learning life skills 
(such as stress management, commu-
nication skills, problemsolving and de-
cisionmaking skills), as well as consid-
eration of cultural and developmental
207 
issues, and the role of family, school, 
and community; 
‘‘(ii) providing education and training 
to educational professionals regarding how 
to promote a healthy lifestyle and a healthy 
school environment for children; 
‘‘(iii) planning and implementing a 
healthy lifestyle curriculum or program 
with an emphasis on healthy eating behav-
iors and physical activity; and 
‘‘(iv) 
planning 
and 
implementing 
healthy lifestyle classes or programs for par-
ents or guardians, with an emphasis on 
healthy eating behaviors and physical activ-
ity for children; 
‘‘(C) carry out educational, counseling, pro-
motional, and training activities through the 
local health care delivery systems including by— 
‘‘(i) promoting healthy eating behav-
iors and physical activity services to treat 
or prevent eating disorders, being over-
weight, and obesity; 
‘‘(ii) providing patient education and 
counseling to increase physical activity and 
promote healthy eating behaviors;
208 
‘‘(iii) training health professionals on 
how to identify and treat obese and over-
weight individuals which may include nu-
trition and physical activity counseling; 
and 
‘‘(iv) providing community education 
by a health professional on good nutrition 
and physical activity to develop a better un-
derstanding of the relationship between diet, 
physical activity, and eating disorders, obe-
sity, or being overweight; and 
‘‘(D) provide, through qualified health pro-
fessionals, training and supervision for commu-
nity health workers to— 
‘‘(i) educate families regarding the re-
lationship between nutrition, eating habits, 
physical activity, and obesity; 
‘‘(ii) educate families about effective 
strategies to improve nutrition, establish 
healthy eating patterns, and establish ap-
propriate levels of physical activity; and 
‘‘(iii) educate and guide parents re-
garding the ability to model and commu-
nicate positive health behaviors.
209 
‘‘(4) PRIORITY.—In awarding grants under 
paragraph (1), the Secretary shall give priority to 
awarding grants to eligible entities— 
‘‘(A) that demonstrate that they have pre-
viously applied successfully for funds to carry 
out activities that seek to promote individual 
and community health and to prevent the inci-
dence of chronic disease and that can cite pub-
lished and peer-reviewed research demonstrating 
that the activities that the entities propose to 
carry out with funds made available under the 
grant are effective; 
‘‘(B) that will carry out programs or activi-
ties that seek to accomplish a goal or goals set 
by the State in the Healthy People 2010 plan of 
the State; 
‘‘(C) that provide non-Federal contribu-
tions, either in cash or in-kind, to the costs of 
funding activities under the grants; 
‘‘(D) that develop comprehensive plans that 
include a strategy for extending program activi-
ties developed under grants in the years fol-
lowing the fiscal years for which they receive 
grants under this subsection;
210 
‘‘(E) located in communities that are medi-
cally underserved, as determined by the Sec-
retary; 
‘‘(F) located in areas in which the average 
poverty rate is at least 150 percent or higher of 
the average poverty rate in the State involved, as 
determined by the Secretary; and 
‘‘(G) that submit plans that exhibit multi-
sectoral, cooperative conduct that includes the in-
volvement of a broad range of stakeholders, in-
cluding— 
‘‘(i) community-based organizations; 
‘‘(ii) local governments; 
‘‘(iii) local educational agencies; 
‘‘(iv) the private sector; 
‘‘(v) State or local departments of 
health; 
‘‘(vi) accredited colleges, universities, 
and community colleges; 
‘‘(vii) health care providers; 
‘‘(viii) State and local departments of 
transportation and city planning; and 
‘‘(ix) other entities determined appro-
priate by the Secretary. 
‘‘(5) PROGRAM DESIGN.—
211 
‘‘(A) INITIAL
DESIGN.—Not later than 1 
year after the date of enactment of the Children’s 
Health Insurance Program Reauthorization Act 
of 2007, the Secretary shall design the dem-
onstration project. The demonstration should 
draw upon promising, innovative models and in-
centives to reduce behavioral risk factors. The 
Administrator of the Centers for Medicare & 
Medicaid Services shall consult with the Director 
of the Centers for Disease Control and Preven-
tion, the Director of the Office of Minority 
Health, the heads of other agencies in the De-
partment of Health and Human Services, and 
such professional organizations, as the Secretary 
determines to be appropriate, on the design, con-
duct, and evaluation of the demonstration. 
‘‘(B) NUMBER AND PROJECT AREAS.—Not 
later than 2 years after the date of enactment of 
the Children’s Health Insurance Program Reau-
thorization Act of 2007, the Secretary shall 
award 1 grant that is specifically designed to de-
termine whether programs similar to programs 
to be conducted by other grantees under this sub-
section should be implemented with respect to the 
general population of children who are eligible
212 
for child health assistance under State child 
health plans under title XXI in order to reduce 
the incidence of childhood obesity among such 
population. 
‘‘(6) REPORT TO CONGRESS.—Not later than 3 
years after the date the Secretary implements the 
demonstration project under this subsection, the Sec-
retary shall submit to Congress a report that describes 
the project, evaluates the effectiveness and cost effec-
tiveness of the project, evaluates the beneficiary satis-
faction under the project, and includes any such other 
information as the Secretary determines to be appro-
priate. 
‘‘(7) DEFINITIONS.—In this subsection: 
‘‘(A) FEDERALLY-QUALIFIED HEALTH CEN-
TER.—The term ‘Federally-qualified health cen-
ter’ has the meaning given that term in section 
1905(l)(2)(B). 
‘‘(B) INDIAN
TRIBE.—The term ‘Indian 
tribe’ has the meaning given that term in section 
4 of the Indian Health Care Improvement Act 
(25 U.S.C. 1603). 
‘‘(C) SELF-ASSESSMENT.—The term ‘self-as-
sessment’ means a form that— 
‘‘(i) includes questions regarding—
213 
‘‘(I) behavioral risk factors; 
‘‘(II) 
needed 
preventive 
and 
screening services; and 
‘‘(III) target individuals’ pref-
erences for receiving follow-up informa-
tion; 
‘‘(ii) is assessed using such computer 
generated assessment programs; and 
‘‘(iii) allows for the provision of such 
ongoing support to the individual as the 
Secretary determines appropriate. 
‘‘(D) ONGOING SUPPORT.—The term ‘ongo-
ing support’ means— 
‘‘(i) to provide any target individual 
with information, feedback, health coaching, 
and recommendations regarding— 
‘‘(I) the results of a self-assessment 
given to the individual; 
‘‘(II) behavior modification based 
on the self-assessment; and 
‘‘(III) any need for clinical pre-
ventive and screening services or treat-
ment including medical nutrition ther-
apy;
214 
‘‘(ii) to provide any target individual 
with referrals to community resources and 
programs available to assist the target indi-
vidual in reducing health risks; and 
‘‘(iii) to provide the information de-
scribed in clause (i) to a health care pro-
vider, if designated by the target individual 
to receive such information. 
‘‘(8) AUTHORIZATION
OF
APPROPRIATIONS.— 
There is authorized to be appropriated to carry out 
this subsection, $25,000,000 for the period of fiscal 
years 2008 through 2012. 
‘‘(f) DEVELOPMENT OF MODEL ELECTRONIC HEALTH 
RECORD FORMAT FOR CHILDREN ENROLLED IN MEDICAID 
OR CHIP.— 
‘‘(1) IN GENERAL.—Not later than January 1, 
2009, the Secretary shall establish a program to en-
courage the development and dissemination of a 
model electronic health record format for children en-
rolled in the State plan under title XIX or the State 
child health plan under title XXI that is— 
‘‘(A) subject to State laws, accessible to par-
ents, caregivers, and other consumers for the sole 
purpose of demonstrating compliance with school
215 
or leisure activity requirements, such as appro-
priate immunizations or physicals; 
‘‘(B) designed to allow interoperable ex-
changes that conform with Federal and State 
privacy and security requirements; 
‘‘(C) structured in a manner that permits 
parents and caregivers to view and understand 
the extent to which the care their children receive 
is clinically appropriate and of high quality; 
and 
‘‘(D) capable of being incorporated into, 
and otherwise compatible with, other standards 
developed for electronic health records. 
‘‘(2) FUNDING.—$5,000,000 of the amount ap-
propriated under subsection (i) for a fiscal year shall 
be used to carry out this subsection. 
‘‘(g) STUDY OF PEDIATRIC HEALTH AND HEALTH 
CARE QUALITY MEASURES.— 
‘‘(1) IN GENERAL.—Not later than July 1, 2009, 
the Institute of Medicine shall study and report to 
Congress on the extent and quality of efforts to meas-
ure child health status and the quality of health care 
for children across the age span and in relation to 
preventive care, treatments for acute conditions, and 
treatments aimed at ameliorating or correcting phys-
216 
ical, mental, and developmental conditions in chil-
dren. In conducting such study and preparing such 
report, the Institute of Medicine shall— 
‘‘(A) consider all of the major national pop-
ulation-based reporting systems sponsored by the 
Federal Government that are currently in place, 
including reporting requirements under Federal 
grant programs and national population surveys 
and estimates conducted directly by the Federal 
Government; 
‘‘(B) identify the information regarding 
child health and health care quality that each 
system is designed to capture and generate, the 
study and reporting periods covered by each sys-
tem, and the extent to which the information so 
generated is made widely available through pub-
lication; 
‘‘(C) identify gaps in knowledge related to 
children’s health status, health disparities among 
subgroups of children, the effects of social condi-
tions on children’s health status and use and ef-
fectiveness of health care, and the relationship 
between child health status and family income, 
family stability and preservation, and children’s
217 
school readiness and educational achievement 
and attainment; and 
‘‘(D) make recommendations regarding im-
proving and strengthening the timeliness, qual-
ity, and public transparency and accessibility of 
information about child health and health care 
quality. 
‘‘(2) FUNDING.—Up to $1,000,000 of the amount 
appropriated under subsection (i) for a fiscal year 
shall be used to carry out this subsection. 
‘‘(h) RULE OF CONSTRUCTION.—Notwithstanding any 
other provision in this section, no evidence based quality 
measure developed, published, or used as a basis of measure-
ment or reporting under this section may be used to estab-
lish an irrebuttable presumption regarding either the med-
ical necessity of care or the maximum permissible coverage 
for any individual child who is eligible for and receiving 
medical assistance under title XIX or child health assist-
ance under title XXI. 
‘‘(i) APPROPRIATION.—Out of any funds in the Treas-
ury not otherwise appropriated, there is appropriated for 
each of fiscal years 2008 through 2012, $45,000,000 for the 
purpose of carrying out this section (other than subsection 
(e)). Funds appropriated under this subsection shall remain 
available until expended.’’.
218 
(b) INCREASED MATCHING RATE FOR COLLECTING 
AND REPORTING ON CHILD HEALTH MEASURES.—Section 
1903(a)(3)(A) (42 U.S.C. 1396b(a)(3)(A)), is amended— 
(1) by striking ‘‘and’’ at the end of clause (i); 
and 
(2) by adding at the end the following new 
clause: 
‘‘(iii) an amount equal to the Federal med-
ical assistance percentage (as defined in section 
1905(b)) of so much of the sums expended during 
such quarter (as found necessary by the Sec-
retary for the proper and efficient administra-
tion of the State plan) as are attributable to such 
developments or modifications of systems of the 
type described in clause (i) as are necessary for 
the efficient collection and reporting on child 
health measures; and’’. 
SEC. 402. IMPROVED AVAILABILITY OF PUBLIC INFORMA-
TION REGARDING ENROLLMENT OF CHIL-
DREN IN CHIP AND MEDICAID. 
(a) INCLUSION OF PROCESS AND ACCESS MEASURES 
IN ANNUAL STATE REPORTS.—Section 2108 (42 U.S.C. 
1397hh) is amended—
219 
(1) in subsection (a), in the matter preceding 
paragraph (1), by striking ‘‘The State’’ and inserting 
‘‘Subject to subsection (e), the State’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(e) INFORMATION REQUIRED
FOR INCLUSION
IN 
STATE ANNUAL REPORT.—The State shall include the fol-
lowing information in the annual report required under 
subsection (a): 
‘‘(1) Eligibility criteria, enrollment, and reten-
tion data (including data with respect to continuity 
of coverage or duration of benefits). 
‘‘(2) Data regarding the extent to which the 
State uses process measures with respect to deter-
mining the eligibility of children under the State 
child health plan, including measures such as 12- 
month continuous eligibility, self-declaration of in-
come for applications or renewals, or presumptive eli-
gibility. 
‘‘(3) Data regarding denials of eligibility and re-
determinations of eligibility. 
‘‘(4) Data regarding access to primary and spe-
cialty services, access to networks of care, and care co-
ordination provided under the State child health 
plan, using quality care and consumer satisfaction
220 
measures included in the Consumer Assessment of 
Healthcare Providers and Systems (CAHPS) survey. 
‘‘(5) If the State provides child health assistance 
in the form of premium assistance for the purchase of 
coverage under a group health plan, data regarding 
the provision of such assistance, including the extent 
to which employer-sponsored health insurance cov-
erage is available for children eligible for child health 
assistance under the State child health plan, the 
range of the monthly amount of such assistance pro-
vided on behalf of a child or family, the number of 
children or families provided such assistance on a 
monthly basis, the income of the children or families 
provided such assistance, the benefits and cost-sharing 
protection provided under the State child health plan 
to supplement the coverage purchased with such pre-
mium assistance, the effective strategies the State en-
gages in to reduce any administrative barriers to the 
provision of such assistance, and, the effects, if any, 
of the provision of such assistance on preventing the 
coverage provided under the State child health plan 
from substituting for coverage provided under em-
ployer-sponsored health insurance offered in the State. 
‘‘(6) To the extent applicable, a description of 
any State activities that are designed to reduce the
221 
number of uncovered children in the State, including 
through a State health insurance connector program 
or support for innovative private health coverage ini-
tiatives.’’. 
(b) STANDARDIZED REPORTING FORMAT.— 
(1) IN GENERAL.—Not later than 1 year after 
the date of enactment of this Act, the Secretary shall 
specify a standardized format for States to use for re-
porting the information required under section 
2108(e) of the Social Security Act, as added by sub-
section (a)(2). 
(2) TRANSITION
PERIOD
FOR
STATES.—Each 
State that is required to submit a report under sub-
section (a) of section 2108 of the Social Security Act 
that includes the information required under sub-
section (e) of such section may use up to 3 reporting 
periods to transition to the reporting of such informa-
tion in accordance with the standardized format spec-
ified by the Secretary under paragraph (1). 
(c) ADDITIONAL FUNDING FOR THE SECRETARY TO 
IMPROVE TIMELINESS OF DATA REPORTING AND ANALYSIS 
FOR PURPOSES OF DETERMINING ENROLLMENT INCREASES 
UNDER MEDICAID AND CHIP.— 
(1) APPROPRIATION.—There is appropriated, out 
of any money in the Treasury not otherwise appro-
222 
priated, $5,000,000 to the Secretary for fiscal year 
2008 for the purpose of improving the timeliness of 
the data reported and analyzed from the Medicaid 
Statistical Information System (MSIS) for purposes 
of providing more timely data on enrollment and eli-
gibility of children under Medicaid and CHIP and to 
provide guidance to States with respect to any new 
reporting requirements related to such improvements. 
Amounts appropriated under this paragraph shall re-
main available until expended. 
(2) REQUIREMENTS.—The improvements made 
by the Secretary under paragraph (1) shall be de-
signed and implemented (including with respect to 
any necessary guidance for States to report such in-
formation in a complete and expeditious manner) so 
that, beginning no later than October 1, 2008, data 
regarding the enrollment of low-income children (as 
defined in section 2110(c)(4) of the Social Security 
Act (42 U.S.C. 1397jj(c)(4)) of a State enrolled in the 
State plan under Medicaid or the State child health 
plan under CHIP with respect to a fiscal year shall 
be collected and analyzed by the Secretary within 6 
months of submission. 
(d) GAO STUDY AND REPORT ON ACCESS TO PRIMARY 
AND SPECIALITY SERVICES.—
223 
(1) IN GENERAL.—The Comptroller General of 
the United States shall conduct a study of children’s 
access to primary and specialty services under Med-
icaid and CHIP, including— 
(A) the extent to which providers are will-
ing to treat children eligible for such programs; 
(B) information on such children’s access to 
networks of care; 
(C) geographic availability of primary and 
specialty services under such programs; 
(D) the extent to which care coordination is 
provided for children’s care under Medicaid and 
CHIP; and 
(E) as appropriate, information on the de-
gree of availability of services for children under 
such programs. 
(2) REPORT.—Not later than 2 years after the 
date of enactment of this Act, the Comptroller General 
shall submit a report to the Committee on Finance of 
the Senate and the Committee on Energy and Com-
merce of the House of Representatives on the study 
conducted under paragraph (1) that includes rec-
ommendations for such Federal and State legislative 
and administrative changes as the Comptroller Gen-
eral determines are necessary to address any barriers
224 
to access to children’s care under Medicaid and CHIP 
that may exist. 
SEC. 403. APPLICATION OF CERTAIN MANAGED CARE QUAL-
ITY SAFEGUARDS TO CHIP. 
(a) IN GENERAL.—Section 2103(f) of Social Security 
Act (42 U.S.C. 1397bb(f)) is amended by adding at the end 
the following new paragraph: 
‘‘(3) COMPLIANCE
WITH
MANAGED
CARE
RE-
QUIREMENTS.—The State child health plan shall pro-
vide for the application of subsections (a)(4), (a)(5), 
(b), (c), (d), and (e) of section 1932 (relating to re-
quirements for managed care) to coverage, State agen-
cies, enrollment brokers, managed care entities, and 
managed care organizations under this title in the 
same manner as such subsections apply to coverage 
and such entities and organizations under title 
XIX.’’. 
(b) EFFECTIVE DATE.—The amendment made by sub-
section (a) shall apply to contract years for health plans 
beginning on or after July 1, 2008. 
TITLE V—IMPROVING ACCESS TO 
BENEFITS 
SEC. 501. DENTAL BENEFITS. 
(a) COVERAGE.—
225 
(1) IN
GENERAL.—Section 2103 (42 U.S.C. 
1397cc) is amended— 
(A) in subsection (a)— 
(i) in the matter before paragraph (1), 
by striking ‘‘subsection (c)(5)’’ and insert-
ing ‘‘paragraphs (5) and (7) of subsection 
(c)’’; and 
(ii) in paragraph (1), by inserting ‘‘at 
least’’ after ‘‘that is’’; and 
(B) in subsection (c)— 
(i) by redesignating paragraph (5) as 
paragraph (7); and 
(ii) by inserting after paragraph (4), 
the following: 
‘‘(5) DENTAL BENEFITS.— 
‘‘(A) IN GENERAL.—The child health assist-
ance provided to a targeted low-income child 
shall include coverage of dental services necessary 
to prevent disease and promote oral health, re-
store oral structures to health and function, and 
treat emergency conditions. 
‘‘(B) PERMITTING USE OF DENTAL BENCH-
MARK PLANS BY CERTAIN STATES.—A State may 
elect to meet the requirement of subparagraph 
(A) through dental coverage that is equivalent to
226 
a benchmark dental benefit package described in 
subparagraph (C). 
‘‘(C) BENCHMARK DENTAL BENEFIT PACK-
AGES.—The benchmark dental benefit packages 
are as follows: 
‘‘(i) FEHBP CHILDREN’S DENTAL COV-
ERAGE.—A dental benefits plan under 
chapter 89A of title 5, United States Code, 
that has been selected most frequently by 
employees 
seeking 
dependent 
coverage, 
among such plans that provide such depend-
ent coverage, in either of the previous 2 
plan years. 
‘‘(ii) STATE
EMPLOYEE
DEPENDENT 
DENTAL COVERAGE.—A dental benefits plan 
that is offered and generally available to 
State employees in the State involved and 
that has been selected most frequently by 
employees 
seeking 
dependent 
coverage, 
among such plans that provide such depend-
ent coverage, in either of the previous 2 
plan years. 
‘‘(iii) COVERAGE OFFERED THROUGH 
COMMERCIAL DENTAL PLAN.—A dental ben-
efits plan that has the largest insured com-
227 
mercial, non-medicaid enrollment of de-
pendent covered lives of such plans that is 
offered in the State involved.’’. 
(2) 
ASSURING
ACCESS
TO
CARE.—Section 
2102(a)(7)(B) (42 U.S.C. 1397bb(c)(2)) is amended 
by inserting ‘‘and services described in section 
2103(c)(5)’’ after ‘‘emergency services’’. 
(3) EFFECTIVE DATE.—The amendments made 
by paragraph (1) shall apply to coverage of items and 
services furnished on or after October 1, 2008. 
(b) 
DENTAL
EDUCATION
FOR
PARENTS
OF 
NEWBORNS.—The Secretary shall develop and implement, 
through entities that fund or provide perinatal care services 
to targeted low-income children under a State child health 
plan under title XXI of the Social Security Act, a program 
to deliver oral health educational materials that inform new 
parents about risks for, and prevention of, early childhood 
caries and the need for a dental visit within their newborn’s 
first year of life. 
(c) PROVISION
OF
DENTAL
SERVICES
THROUGH 
FQHCS.— 
(1) MEDICAID.—Section 1902(a) (42 U.S.C. 
1396a(a)) is amended— 
(A) by striking ‘‘and’’ at the end of para-
graph (69);
228 
(B) by striking the period at the end of 
paragraph (70) and inserting ‘‘; and’’; and 
(C) by inserting after paragraph (70) the 
following new paragraph: 
‘‘(71) provide that the State will not prevent a 
Federally-qualified health center from entering into 
contractual relationships with private practice dental 
providers in the provision of Federally-qualified 
health center services.’’. 
(2) CHIP.—Section 2107(e)(1) (42 U.S.C. 
1397g(e)(1)), as amended by subsections (a)(2) and 
(d)(2) of section 203, is amended by inserting after 
subparagraph (B) the following new subparagraph 
(and redesignating the succeeding subparagraphs ac-
cordingly): 
‘‘(C) Section 1902(a)(71) (relating to lim-
iting FQHC contracting for provision of dental 
services).’’. 
(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall take effect on January 1, 
2008. 
(d) REPORTING INFORMATION ON DENTAL HEALTH.— 
(1) MEDICAID.—Section 1902(a)(43)(D)(iii) (42 
U.S.C. 1396a(a)(43)(D)(iii)) is amended by inserting 
‘‘and other information relating to the provision of
229 
dental services to such children described in section 
2108(e)’’ after ‘‘receiving dental services,’’. 
(2) CHIP.—Section 2108 (42 U.S.C. 1397hh) is 
amended by adding at the end the following new sub-
section: 
‘‘(e) INFORMATION
ON DENTAL CARE
FOR CHIL-
DREN.— 
‘‘(1) IN GENERAL.—Each annual report under 
subsection (a) shall include the following information 
with respect to care and services described in section 
1905(r)(3) provided to targeted low-income children 
enrolled in the State child health plan under this title 
at any time during the year involved: 
‘‘(A) The number of enrolled children by age 
grouping used for reporting purposes under sec-
tion 1902(a)(43). 
‘‘(B) For children within each such age 
grouping, information of the type contained in 
questions 12(a)–(c) of CMS Form 416 (that con-
sists of the number of enrolled targeted low in-
come children who receive any, preventive, or re-
storative dental care under the State plan). 
‘‘(C) For the age grouping that includes 
children 8 years of age, the number of such chil-
230 
dren who have received a protective sealant on at 
least one permanent molar tooth. 
‘‘(2) INCLUSION OF INFORMATION ON ENROLLEES 
IN MANAGED CARE PLANS.—The information under 
paragraph (1) shall include information on children 
who are enrolled in managed care plans and other 
private health plans and contracts with such plans 
under this title shall provide for the reporting of such 
information by such plans to the State.’’. 
(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall be effective for annual reports 
submitted for years beginning after date of enactment. 
(e) IMPROVED ACCESSIBILITY OF DENTAL PROVIDER 
INFORMATION
TO ENROLLEES UNDER MEDICAID
AND 
CHIP.—The Secretary shall— 
(1) work with States, pediatric dentists, and 
other dental providers (including providers that are, 
or are affiliated with, a school of dentistry) to in-
clude, not later than 6 months after the date of the 
enactment of this Act, on the Insure Kids Now website 
(http://www.insurekidsnow.gov/) and hotline (1–877– 
KIDS–NOW) (or on any successor websites or hot-
lines) a current and accurate list of all such dentists 
and providers within each State that provide dental 
services to children enrolled in the State plan (or
231 
waiver) under Medicaid or the State child health plan 
(or waiver) under CHIP, and shall ensure that such 
list is updated at least quarterly; and 
(2) work with States to include, not later than 
6 months after the date of the enactment of this Act, 
a description of the dental services provided under 
each State plan (or waiver) under Medicaid and each 
State child health plan (or waiver) under CHIP on 
such Insure Kids Now website, and shall ensure that 
such list is updated at least annually. 
(f) INCLUSION OF STATUS OF EFFORTS TO IMPROVE 
DENTAL CARE IN REPORTS ON THE QUALITY OF CHIL-
DREN’S HEALTH CARE UNDER MEDICAID AND CHIP.— 
Section 1139A(a), as added by section 401(a), is amend-
ed— 
(1) in paragraph (3)(B)(ii), by inserting ‘‘and, 
with respect to dental care, conditions requiring the 
restoration of teeth, relief of pain and infection, and 
maintenance of dental health’’ after ‘‘chronic condi-
tions’’; and 
(2) in paragraph (6)(A)(ii), by inserting ‘‘dental 
care,’’ after ‘‘preventive health services,’’. 
(g) GAO STUDY AND REPORT.—
232 
(1) STUDY.—The Comptroller General of the 
United States shall provide for a study that exam-
ines— 
(A) access to dental services by children in 
underserved areas; 
(B) children’s access to oral health care, in-
cluding preventive and restorative services, under 
Medicaid and CHIP, including— 
(i) the extent to which dental providers 
are willing to treat children eligible for such 
programs; 
(ii) information on such children’s ac-
cess to networks of care, including such net-
works that serve special needs children; and 
(iii) geographic availability of oral 
health care, including preventive and restor-
ative services, under such programs; and 
(C) the feasibility and appropriateness of 
using qualified mid-level dental health providers, 
in coordination with dentists, to improve access 
for children to oral health services and public 
health overall. 
(2) REPORT.—Not later than 18 months year 
after the date of the enactment of this Act, the Comp-
troller General shall submit to Congress a report on
233 
the study conducted under paragraph (1). The report 
shall include recommendations for such Federal and 
State legislative and administrative changes as the 
Comptroller General determines are necessary to ad-
dress any barriers to access to oral health care, in-
cluding preventive and restorative services, under 
Medicaid and CHIP that may exist. 
SEC. 502. MENTAL HEALTH PARITY IN CHIP PLANS. 
(a) ASSURANCE
OF PARITY.—Section 2103(c) (42 
U.S.C. 1397cc(c)), as amended by section 501(a)(1)(B), is 
amended by inserting after paragraph (5), the following: 
‘‘(6) MENTAL HEALTH SERVICES PARITY.— 
‘‘(A) IN GENERAL.—In the case of a State 
child health plan that provides both medical and 
surgical benefits and mental health or substance 
abuse benefits, such plan shall ensure that the fi-
nancial requirements and treatment limitations 
applicable to such mental health or substance 
abuse benefits are no more restrictive than the fi-
nancial requirements and treatment limitations 
applied to substantially all medical and surgical 
benefits covered by the plan. 
‘‘(B) DEEMED COMPLIANCE.—To the extent 
that a State child health plan includes coverage 
with respect to an individual described in section
234 
1905(a)(4)(B) and covered under the State plan 
under section 1902(a)(10)(A) of the services de-
scribed in section 1905(a)(4)(B) (relating to 
early and periodic screening, diagnostic, and 
treatment services defined in section 1905(r)) 
and 
provided 
in 
accordance 
with 
section 
1902(a)(43), such plan shall be deemed to satisfy 
the requirements of subparagraph (A).’’. 
(b) CONFORMING AMENDMENTS.—Section 2103 (42 
U.S.C. 1397cc) is amended— 
(1) in subsection (a), as amended by section 
501(a)(1)(A)(i), in the matter preceding paragraph 
(1), by inserting ‘‘, (6),’’ after ‘‘(5)’’; and 
(2) in subsection (c)(2), by striking subpara-
graph (B) and redesignating subparagraphs (C) and 
(D) as subparagraphs (B) and (C), respectively. 
SEC. 503. APPLICATION OF PROSPECTIVE PAYMENT SYSTEM 
FOR SERVICES PROVIDED BY FEDERALLY- 
QUALIFIED HEALTH CENTERS AND RURAL 
HEALTH CLINICS. 
(a) APPLICATION
OF PROSPECTIVE PAYMENT SYS-
TEM.— 
(1) IN GENERAL.—Section 2107(e)(1) (42 U.S.C. 
1397gg(e)(1)), as amended by section 501(c)(2) is 
amended by inserting after subparagraph (C) the fol-
235 
lowing new subparagraph (and redesignating the suc-
ceeding subparagraphs accordingly): 
‘‘(D) Section 1902(bb) (relating to payment 
for services provided by Federally-qualified 
health centers and rural health clinics).’’. 
(2) EFFECTIVE DATE.—The amendment made by 
paragraph (1) shall apply to services provided on or 
after October 1, 2008. 
(b) TRANSITION GRANTS.— 
(1) APPROPRIATION.—Out of any funds in the 
Treasury not otherwise appropriated, there is appro-
priated to the Secretary for fiscal year 2008, 
$5,000,000, to remain available until expended, for 
the purpose of awarding grants to States with State 
child health plans under CHIP that are operated sep-
arately from the State Medicaid plan under title XIX 
of the Social Security Act (including any waiver of 
such plan), or in combination with the State Med-
icaid plan, for expenditures related to transitioning 
to compliance with the requirement of section 
2107(e)(1)(D) of the Social Security Act (as added by 
subsection (a)) to apply the prospective payment sys-
tem established under section 1902(bb) of the such Act 
(42 U.S.C. 1396a(bb)) to services provided by Feder-
ally-qualified health centers and rural health clinics.
236 
(2) MONITORING AND REPORT.—The Secretary 
shall monitor the impact of the application of such 
prospective payment system on the States described in 
paragraph (1) and, not later than October 1, 2010, 
shall report to Congress on any effect on access to ben-
efits, provider payment rates, or scope of benefits of-
fered by such States as a result of the application of 
such payment system. 
SEC. 504. PREMIUM GRACE PERIOD. 
(a) IN GENERAL.—Section 2103(e)(3) (42 U.S.C. 
1397cc(e)(3)) is amended by adding at the end the following 
new subparagraph: 
‘‘(C) PREMIUM GRACE PERIOD.—The State 
child health plan— 
‘‘(i) shall afford individuals enrolled 
under the plan a grace period of at least 30 
days from the beginning of a new coverage 
period to make premium payments before 
the individual’s coverage under the plan 
may be terminated; and 
‘‘(ii) shall provide to such an indi-
vidual, not later than 7 days after the first 
day of such grace period, notice— 
‘‘(I) that failure to make a pre-
mium payment within the grace period
237 
will result in termination of coverage 
under the State child health plan; and 
‘‘(II) of the individual’s right to 
challenge the proposed termination 
pursuant to the applicable Federal reg-
ulations. 
For purposes of clause (i), the term ‘new cov-
erage period’ means the month immediately fol-
lowing the last month for which the premium 
has been paid.’’. 
(b) EFFECTIVE DATE.—The amendment made by sub-
section (a) shall apply to new coverage periods beginning 
on or after January 1, 2009. 
SEC. 505. DEMONSTRATION PROJECTS RELATING TO DIA-
BETES PREVENTION. 
There is authorized to be appropriated $15,000,000 
during the period of fiscal years 2008 through 2012 to fund 
demonstration projects in up to 10 States over 3 years for 
voluntary incentive programs to promote children’s receipt 
of relevant screenings and improvements in healthy eating 
and physical activity with the aim of reducing the inci-
dence of type 2 diabetes. Such programs may involve reduc-
tions in cost-sharing or premiums when children receive 
regular screening and reach certain benchmarks in healthy 
eating and physical activity. Under such programs, a State
238 
may also provide financial bonuses for partnerships with 
entities, such as schools, which increase their education and 
efforts with respect to reducing the incidence of type 2 dia-
betes and may also devise incentives for providers serving 
children covered under this title and title XIX to perform 
relevant screening and counseling regarding healthy eating 
and physical activity. Upon completion of these demonstra-
tions, the Secretary shall provide a report to Congress on 
the results of the State demonstration projects and the de-
gree to which they helped improve health outcomes related 
to type 2 diabetes in children in those States. 
SEC. 506. CLARIFICATION OF COVERAGE OF SERVICES PRO-
VIDED THROUGH SCHOOL-BASED HEALTH 
CENTERS. 
Section 2103(c) (42 U.S.C. 1397cc(c)), as amended by 
section 501(a)(1)(B), is amended by adding at the end the 
following new paragraph: 
‘‘(8) AVAILABILITY
OF
COVERAGE
FOR
ITEMS 
AND SERVICES FURNISHED THROUGH SCHOOL-BASED 
HEALTH CENTERS.—Nothing in this title shall be con-
strued as limiting a State’s ability to provide child 
health assistance for covered items and services that 
are furnished through school-based health centers.’’.
239 
TITLE VI—PROGRAM INTEGRITY 
AND OTHER MISCELLANEOUS 
PROVISIONS 
Subtitle A—Program Integrity and 
Data Collection 
SEC. 601. PAYMENT ERROR RATE MEASUREMENT (‘‘PERM’’). 
(a) EXPENDITURES RELATED TO COMPLIANCE WITH 
REQUIREMENTS.— 
(1) ENHANCED PAYMENTS.—Section 2105(c) (42 
U.S.C. 1397ee(c)), as amended by section 301(a), is 
amended by adding at the end the following new 
paragraph: 
‘‘(12) ENHANCED
PAYMENTS.—Notwithstanding 
subsection (b), the enhanced FMAP with respect to 
payments under subsection (a) for expenditures re-
lated to the administration of the payment error rate 
measurement (PERM) requirements applicable to the 
State child health plan in accordance with the Im-
proper Payments Information Act of 2002 and parts 
431 and 457 of title 42, Code of Federal Regulations 
(or any related or successor guidance or regulations) 
shall in no event be less than 90 percent.’’. 
(2) EXCLUSION OF FROM CAP ON ADMINISTRA-
TIVE
EXPENDITURES.—Section 2105(c)(2)(C) (42 
U.S.C. 1397ee(c)(2)C)), as amended by section
240 
302(b)), is amended by adding at the end the fol-
lowing: 
‘‘(iv) PAYMENT
ERROR
RATE
MEAS-
UREMENT
(PERM)
EXPENDITURES.—Ex-
penditures related to the administration of 
the 
payment 
error 
rate 
measurement 
(PERM) requirements applicable to the 
State child health plan in accordance with 
the Improper Payments Information Act of 
2002 and parts 431 and 457 of title 42, 
Code of Federal Regulations (or any related 
or successor guidance or regulations).’’. 
(b) FINAL RULE REQUIRED TO BE IN EFFECT FOR 
ALL STATES.—Notwithstanding parts 431 and 457 of title 
42, Code of Federal Regulations (as in effect on the date 
of enactment of this Act), the Secretary shall not calculate 
or publish any national or State-specific error rate based 
on the application of the payment error rate measurement 
(in this section referred to as ‘‘PERM’’) requirements to 
CHIP until after the date that is 6 months after the date 
on which a final rule implementing such requirements in 
accordance with the requirements of subsection (c) is in ef-
fect for all States. Any calculation of a national error rate 
or a State specific error rate after such final rule in effect 
for all States may only be inclusive of errors, as defined
241 
in such final rule or in guidance issued within a reasonable 
time frame after the effective date for such final rule that 
includes detailed guidance for the specific methodology for 
error determinations. 
(c) REQUIREMENTS FOR FINAL RULE.—For purposes 
of subsection (b), the requirements of this subsection are that 
the final rule implementing the PERM requirements 
shall— 
(1) include— 
(A) clearly defined criteria for errors for 
both States and providers; 
(B) a clearly defined process for appealing 
error determinations by— 
(i) review contractors; or 
(ii) the agency and personnel described 
in section 431.974(a)(2) of title 42, Code of 
Federal Regulations, as in effect on Sep-
tember 1, 2007, responsible for the develop-
ment, direction, implementation, and eval-
uation of eligibility reviews and associated 
activities; and 
(C) clearly defined responsibilities and 
deadlines for States in implementing any correc-
tive action plans; and
242 
(2) provide that the payment error rate deter-
mined for a State shall not take into account pay-
ment errors resulting from the State’s verification of 
an applicant’s self-declaration or self-certification of 
eligibility for, and the correct amount of, medical as-
sistance or child health assistance, if the State process 
for verifying an applicant’s self-declaration or self- 
certification satisfies the requirements for such process 
applicable under regulations promulgated by the Sec-
retary or otherwise approved by the Secretary. 
(d) OPTION FOR APPLICATION OF DATA FOR STATES 
IN FIRST APPLICATION CYCLE UNDER THE INTERIM FINAL 
RULE.—After the final rule implementing the PERM re-
quirements in accordance with the requirements of sub-
section (c) is in effect for all States, a State for which the 
PERM requirements were first in effect under an interim 
final rule for fiscal year 2007 may elect to accept any pay-
ment error rate determined in whole or in part for the State 
on the basis of data for that fiscal year or may elect to 
not have any payment error rate determined on the basis 
of such data and, instead, shall be treated as if fiscal year 
2010 were the first fiscal year for which the PERM require-
ments apply to the State. 
(e) HARMONIZATION OF MEQC AND PERM.—
243 
(1) REDUCTION OF REDUNDANCIES.—The Sec-
retary shall review the Medicaid Eligibility Quality 
Control (in this subsection referred to as the 
‘‘MEQC’’) requirements with the PERM requirements 
and coordinate consistent implementation of both sets 
of requirements, while reducing redundancies. 
(2) STATE OPTION TO APPLY PERM DATA.—A 
State may elect, for purposes of determining the erro-
neous 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 appli-
cation 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 appli-
cation 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-
244 
quired for purposes of PERM requirements, but only 
if the State MEQC reviews are based on a broad, rep-
resentative sample of Medicaid applicants or enrollees 
in the States. 
(f) IDENTIFICATION
OF IMPROVED STATE-SPECIFIC 
SAMPLE SIZES.—The Secretary shall establish State-spe-
cific sample sizes for application of the PERM requirements 
with respect to State child health plans for fiscal years be-
ginning with fiscal year 2009, on the basis of such informa-
tion as the Secretary determines appropriate. In estab-
lishing such sample sizes, the Secretary shall, to the greatest 
extent practicable— 
(1) minimize the administrative cost burden on 
States under Medicaid and CHIP; and 
(2) maintain State flexibility to manage such 
programs. 
SEC. 602. IMPROVING DATA COLLECTION. 
(a) INCREASED APPROPRIATION.—Section 2109(b)(2) 
(42 
U.S.C. 
1397ii(b)(2)) 
is 
amended 
by 
striking 
‘‘$10,000,000 for fiscal year 2000’’ and inserting 
‘‘$20,000,000 for fiscal year 2008’’. 
(b) USE OF ADDITIONAL FUNDS.—Section 2109(b) (42 
U.S.C. 1397ii(b)), as amended by subsection (a), is amend-
ed—
245 
(1) by redesignating paragraph (2) as para-
graph (4); and 
(2) by inserting after paragraph (1), the fol-
lowing new paragraphs: 
‘‘(2) ADDITIONAL REQUIREMENTS.—In addition 
to making the adjustments required to produce the 
data described in paragraph (1), with respect to data 
collection occurring for fiscal years beginning with 
fiscal year 2008, in appropriate consultation with the 
Secretary of Health and Human Services, the Sec-
retary of Commerce shall do the following: 
‘‘(A) Make appropriate adjustments to the 
Current Population Survey to develop more ac-
curate State-specific estimates of the number of 
children enrolled in health coverage under title 
XIX or this title. 
‘‘(B) Make appropriate adjustments to the 
Current Population Survey to improve the sur-
vey estimates used to determine the child popu-
lation growth factor under section 2104(i)(5)(B) 
and any other data necessary for carrying out 
this title. 
‘‘(C) Include health insurance survey infor-
mation in the American Community Survey re-
lated to children.
247 
Human Services that American Community Survey 
estimates should be used in lieu of, or in some com-
bination with, Current Population Survey estimates 
for the purposes described in paragraph (2)(B), the 
Secretary of Health and Human Services, in con-
sultation with the States, may provide for a period 
during which the Secretary may transition from car-
rying out such purposes through the use of Current 
Population Survey estimates to the use of American 
Community Survey estimates (in lieu of, or in com-
bination with the Current Population Survey esti-
mates, as recommended), provided that any such 
transition is implemented in a manner that is de-
signed to avoid adverse impacts upon States with ap-
proved State child health plans under this title.’’. 
SEC. 603. UPDATED FEDERAL EVALUATION OF CHIP. 
Section 2108(c) (42 U.S.C. 1397hh(c)) is amended by 
striking paragraph (5) and inserting the following: 
‘‘(5) SUBSEQUENT EVALUATION USING UPDATED 
INFORMATION.— 
‘‘(A) IN GENERAL.—The Secretary, directly 
or through contracts or interagency agreements, 
shall conduct an independent subsequent evalua-
tion of 10 States with approved child health 
plans.
248 
‘‘(B) SELECTION OF STATES AND MATTERS 
INCLUDED.—Paragraphs (2) and (3) shall apply 
to such subsequent evaluation in the same man-
ner as such provisions apply to the evaluation 
conducted under paragraph (1). 
‘‘(C) SUBMISSION TO CONGRESS.—Not later 
than December 31, 2010, the Secretary shall sub-
mit to Congress the results of the evaluation con-
ducted under this paragraph. 
‘‘(D) FUNDING.—Out of any money in the 
Treasury of the United States not otherwise ap-
propriated, there are appropriated $10,000,000 
for fiscal year 2009 for the purpose of conducting 
the evaluation authorized under this paragraph. 
Amounts appropriated under this subparagraph 
shall remain available for expenditure through 
fiscal year 2011.’’. 
SEC. 604. ACCESS TO RECORDS FOR IG AND GAO AUDITS 
AND EVALUATIONS. 
Section 2108(d) (42 U.S.C. 1397hh(d)) is amended to 
read as follows: 
‘‘(d) ACCESS TO RECORDS FOR IG AND GAO AUDITS 
AND EVALUATIONS.—For the purpose of evaluating and au-
diting the program established under this title, or title XIX, 
the Secretary, the Office of Inspector General, and the
249 
Comptroller General shall have access to any books, ac-
counts, records, correspondence, and other documents that 
are related to the expenditure of Federal funds under this 
title and that are in the possession, custody, or control of 
States receiving Federal funds under this title or political 
subdivisions thereof, or any grantee or contractor of such 
States or political subdivisions.’’. 
SEC. 605. NO FEDERAL FUNDING FOR ILLEGAL ALIENS. 
Nothing in this Act allows Federal payment for indi-
viduals who are not legal residents. 
Subtitle B—Miscellaneous Health 
Provisions 
SEC. 611. DEFICIT REDUCTION ACT TECHNICAL CORREC-
TIONS. 
(a) CLARIFICATION OF REQUIREMENT TO PROVIDE 
EPSDT SERVICES FOR ALL CHILDREN IN BENCHMARK 
BENEFIT
PACKAGES
UNDER
MEDICAID.—Section 
1937(a)(1) (42 U.S.C. 1396u–7(a)(1)), as inserted by sec-
tion 6044(a) of the Deficit Reduction Act of 2005 (Public 
Law 109–171, 120 Stat. 88), is amended— 
(1) in subparagraph (A)— 
(A) in the matter before clause (i)— 
(i) by striking ‘‘Notwithstanding any 
other provision of this title’’ and inserting 
‘‘Notwithstanding section 1902(a)(1) (relat-
250 
ing 
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 subsection 
(E)’’; and 
(ii) by striking ‘‘enrollment in coverage 
that provides’’ and inserting ‘‘coverage 
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 
1905(r)) and provided in accordance with 
the requirements of section 1902(a)(43).’’; 
(2) in subparagraph (C)—
251 
(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 subsection 
(b)(1) or benchmark equivalent coverage de-
scribed in subsection (b)(2); 
‘‘(ii) preventing a State from offering 
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 cov-
erage 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-
vided 
in 
accordance 
with 
section 
1902(a)(43) 
whether 
provided 
through
252 
benchmark coverage, benchmark equivalent 
coverage, or otherwise.’’. 
(b) CORRECTION OF REFERENCE TO CHILDREN IN 
FOSTER CARE RECEIVING CHILD WELFARE SERVICES.— 
Section 
1937(a)(2)(B)(viii) 
(42 
U.S.C. 
1396u– 
7(a)(2)(B)(viii), as inserted by section 6044(a) of the Def-
icit Reduction Act of 2005, is amended by striking ‘‘aid 
or assistance is made available under part B of title IV 
to children in foster care and individuals’’ and inserting 
‘‘child welfare services are made available under part B of 
title IV on the basis of being a child in foster care or’’. 
(c) TRANSPARENCY.—Section 1937 (42 U.S.C. 1396u– 
7), as inserted by section 6044(a) of the Deficit Reduction 
Act of 2005, is amended by adding at the end the following: 
‘‘(c) PUBLICATION OF PROVISIONS AFFECTED.—With 
respect to a State plan amendment to provide benchmark 
benefits in accordance with subsections (a) and (b) that is 
approved by the Secretary, the Secretary shall publish on 
the Internet website of the Centers for Medicare & Medicaid 
Services, a list of the provisions of this title that the Sec-
retary has determined do not apply in order to enable the 
State to carry out the plan amendment and the reason for 
each such determination on the date such approval is made, 
and shall publish such list in the Federal Register and not 
later than 30 days after such date of approval.’’.
253 
(d) EFFECTIVE DATE.—The amendments made by 
subsections (a), (b), and (c) of this section shall take effect 
as if included in the amendment made by section 6044(a) 
of the Deficit Reduction Act of 2005. 
SEC. 612. REFERENCES TO TITLE XXI. 
Section 704 of the Medicare, Medicaid, and SCHIP 
Balanced Budget Refinement Act of 1999, as enacted into 
law by division B of Public Law 106–113 (113 Stat. 
1501A–402) is repealed. 
SEC. 613. PROHIBITING INITIATION OF NEW HEALTH OP-
PORTUNITY ACCOUNT DEMONSTRATION PRO-
GRAMS. 
After the date of the enactment of this Act, the Sec-
retary of Health and Human Services may not approve any 
new demonstration programs under section 1938 of the So-
cial Security Act (42 U.S.C. 1396u–8). 
SEC. 614. COUNTY MEDICAID HEALTH INSURING ORGANIZA-
TIONS; GAO REPORT ON MEDICAID MANAGED 
CARE PAYMENT RATES. 
(a) IN GENERAL.—Section 9517(c)(3) of the Consoli-
dated Omnibus Budget Reconciliation Act of 1985 (42 
U.S.C. 1396b note), as added by section 4734 of the Omni-
bus Budget Reconciliation Act of 1990 and as amended by 
section 704 of the Medicare, Medicaid, and SCHIP Benefits 
Improvement and Protection Act of 2000, is amended—
254 
(1) in subparagraph (A), by inserting ‘‘, in the 
case of any health insuring organization described in 
such subparagraph that is operated by a public entity 
established by Ventura County, and in the case of any 
health insuring organization described in such sub-
paragraph that is operated by a public entity estab-
lished by Merced County’’ after ‘‘described in sub-
paragraph (B)’’; and 
(2) in subparagraph (C), by striking ‘‘14 per-
cent’’ and inserting ‘‘16 percent’’. 
(b) EFFECTIVE DATE.—The amendments made by sub-
section (a) shall take effect on the date of the enactment 
of this Act. 
(c) GAO REPORT ON ACTUARIAL SOUNDNESS OF MED-
ICAID MANAGED CARE PAYMENT RATES.—Not later than 
18 months after the date of the enactment of this Act, the 
Comptroller General of the United States shall submit a re-
port to the Committee on Finance of the Senate and the 
Committee on Energy and Commerce of the House of Rep-
resentatives analyzing the extent to which State payment 
rates for medicaid managed care organizations under title 
XIX of the Social Security Act are actuarially sound.
255 
SEC. 615. ADJUSTMENT IN COMPUTATION OF MEDICAID 
FMAP TO DISREGARD AN EXTRAORDINARY 
EMPLOYER PENSION CONTRIBUTION. 
(a) IN GENERAL.—Only for purposes of computing the 
FMAP (as defined in subsection (e)) for a State for a fiscal 
year (beginning with fiscal year 2006) and applying the 
FMAP under title XIX of the Social Security Act, any sig-
nificantly disproportionate employer pension or insurance 
fund contribution described in subsection (b) shall be dis-
regarded in computing the per capita income of such State, 
but shall not be disregarded in computing the per capita 
income for the continental United States (and Alaska) and 
Hawaii. 
(b) SIGNIFICANTLY DISPROPORTIONATE EMPLOYER 
PENSION AND INSURANCE FUND CONTRIBUTION.— 
(1) IN GENERAL.—For purposes of this section, 
a significantly disproportionate employer pension 
and insurance fund contribution described in this 
subsection with respect to a State is any identifiable 
employer contribution towards pension or other em-
ployee insurance funds that is estimated to accrue to 
residents of such State for a calendar year (beginning 
with calendar year 2003) if the increase in the 
amount so estimated exceeds 25 percent of the total 
increase in personal income in that State for the year 
involved.
256 
(2) DATA TO BE USED.—For estimating and ad-
justment a FMAP already calculated as of the date of 
the enactment of this Act for a State with a signifi-
cantly disproportionate employer pension and insur-
ance fund contribution, the Secretary shall use the 
personal income data set originally used in calcu-
lating such FMAP. 
(3) 
SPECIAL
ADJUSTMENT
FOR
NEGATIVE 
GROWTH.—If in any calendar year the total personal 
income growth in a State is negative, an employer 
pension and insurance fund contribution for the pur-
poses of calculating the State’s FMAP for a calendar 
year shall not exceed 125 percent of the amount of 
such contribution for the previous calendar year for 
the State. 
(c) HOLD HARMLESS.—No State shall have its FMAP 
for a fiscal year reduced as a result of the application of 
this section. 
(d) REPORT.—Not later than May 15, 2008, the Sec-
retary shall submit to the Congress a report on the problems 
presented by the current treatment of pension and insur-
ance fund contributions in the use of Bureau of Economic 
Affairs calculations for the FMAP and for Medicaid and 
on possible alternative methodologies to mitigate such prob-
lems.
257 
(e) FMAP DEFINED.—For purposes of this section, the 
term ‘‘FMAP’’ means the Federal medical assistance per-
centage, as defined in section 1905(b) of the Social Security 
Act (42 U.S.C. 1396(d)). 
SEC. 616. MORATORIUM ON CERTAIN PAYMENT RESTRIC-
TIONS. 
Notwithstanding any other provision of law, the Sec-
retary of Health and Human Services shall not, prior to 
May 28, 2008, take any action (through promulgation of 
regulation, issuance of regulatory guidance, use of federal 
payment audit procedures, or other administrative action, 
policy, or practice, including a Medical Assistance Manual 
transmittal or letter to State Medicaid directors) to restrict 
coverage or payment under title XIX of the Social Security 
Act for rehabilitation services, or school-based administra-
tion, transportation, or medical services if such restrictions 
are more restrictive in any aspect than those applied to 
such coverage or payment as of July 1, 2007. 
SEC. 617. MEDICAID DSH ALLOTMENTS FOR TENNESSEE 
AND HAWAII. 
(a) TENNESSEE.—The DSH allotments for Tennessee 
for each fiscal year beginning with fiscal year 2008 under 
subsection (f)(3) of section 1923 of the Social Security Act 
(42 U.S.C. 1396r–4) are deemed to be $30,000,000. The Sec-
retary of Health and Human Services may impose a limi-
258 
tation on the total amount of payments made to hospitals 
under the TennCare Section 1115 waiver only to the extent 
that such limitation is necessary to ensure that a hospital 
does not receive payment in excess of the amounts described 
in subsection (f) of such section or as necessary to ensure 
that the waiver remains budget neutral. 
(b) HAWAII.—Section 1923(f)(6) (42 U.S.C. 1396r– 
4(f)(6)) is amended— 
(1) in the paragraph heading, by striking ‘‘FOR 
FISCAL YEAR 2007’’; and 
(2) in subparagraph (B)— 
(A) in clause (i), by striking ‘‘Only with re-
spect to fiscal year 2007’’ and inserting ‘‘With 
respect to each of fiscal years 2007 and 2008’’; 
(B) by redesignating clause (ii) as clause 
(iv); and 
(C) by inserting after clause (i), the fol-
lowing new clauses: 
‘‘(ii) TREATMENT
AS
A
LOW-DSH 
STATE.—With respect to fiscal year 2009 
and each fiscal year thereafter, notwith-
standing the table set forth in paragraph 
(2), the DSH allotment for Hawaii shall be 
increased in the same manner as allotments 
for low DSH States are increased for such
259 
fiscal year under clauses (ii) and (iii) of 
paragraph (5)(B). 
‘‘(iii) 
CERTAIN
HOSPITAL
PAY-
MENTS.—The Secretary may not impose a 
limitation on the total amount of payments 
made to hospitals under the QUEST section 
1115 Demonstration Project except to the 
extent that such limitation is necessary to 
ensure that a hospital does not receive pay-
ments in excess of the amounts described in 
subsection (g), or as necessary to ensure 
that such payments under the waiver and 
such payments pursuant to the allotment 
provided in this section do not, in the ag-
gregate in any year, exceed the amount that 
the Secretary determines is equal to the 
Federal medical assistance percentage com-
ponent 
attributable 
to 
disproportionate 
share hospital payment adjustments for 
such year that is reflected in the budget 
neutrality provision of the QUEST Dem-
onstration Project.’’.
260 
SEC. 618. CLARIFICATION TREATMENT OF REGIONAL MED-
ICAL CENTER. 
(a) IN GENERAL.—Nothing in section 1903(w) of the 
Social Security Act (42 U.S.C. 1396b(w)) shall be construed 
by the Secretary of Health and Human Services as prohib-
iting a State’s use of funds as the non-Federal share of ex-
penditures under title XIX of such Act where such funds 
are transferred from or certified by a publicly-owned re-
gional medical center located in another State and de-
scribed in subsection (b), so long as the Secretary deter-
mines that such use of funds is proper and in the interest 
of the program under title XIX. 
(b) CENTER DESCRIBED.—A center described in this 
subsection is a publicly-owned regional medical center 
that— 
(1) provides level 1 trauma and burn care serv-
ices; 
(2) provides level 3 neonatal care services; 
(3) is obligated to serve all patients, regardless of 
ability to pay; 
(4) is located within a Standard Metropolitan 
Statistical Area (SMSA) that includes at least 3 
States; 
(5) provides services as a tertiary care provider 
for patients residing within a 125-mile radius; and
261 
(6) meets the criteria for a disproportionate 
share hospital under section 1923 of such Act (42 
U.S.C. 1396r–4) in at least one State other than the 
State in which the center is located. 
SEC. 619. EXTENSION OF SSI WEB-BASED ASSET DEM-
ONSTRATION PROJECT TO THE MEDICAID 
PROGRAM. 
(a) IN GENERAL.—Beginning on October 1, 2012, the 
Secretary of Health and Human Services shall provide for 
the application to asset eligibility determinations under the 
Medicaid program under title XIX of the Social Security 
Act of the automated, secure, web-based asset verification 
request and response process being applied for determining 
eligibility for benefits under the Supplemental Security In-
come (SSI) program under title XVI of such Act under a 
demonstration project conducted under the authority of sec-
tion 
1631(e)(1)(B)(ii) 
of 
such 
Act 
(42 
U.S.C. 
1383(e)(1)(B)(ii)). 
(b) LIMITATION.—Such application shall only extend 
to those States in which such demonstration project is oper-
ating and only for the period in which such project is other-
wise provided. 
(c) RULES OF APPLICATION.—For purposes of car-
rying out subsection (a), notwithstanding any other provi-
sion of law, information obtained from a financial institu-
262 
tion that is used for purposes of eligibility determinations 
under such demonstration project with respect to the Sec-
retary of Health and Human Services under the SSI pro-
gram may also be shared and used by States for purposes 
of eligibility determinations under the Medicaid program. 
In applying section 1631(e)(1)(B)(ii) of the Social Security 
Act under this subsection, references to the Commissioner 
of Social Security and benefits under title XVI of such Act 
shall be treated as including a reference to a State described 
in subsection (b) and medical assistance under title XIX 
of such Act provided by such a State. 
Subtitle C—Other Provisions 
SEC. 621. SUPPORT FOR INJURED SERVICEMEMBERS. 
(a) SHORT TITLE.—This section may be cited as the 
‘‘Support for Injured Servicemembers Act’’. 
(b) SERVICEMEMBER FAMILY LEAVE.— 
(1) DEFINITIONS.—Section 101 of the Family 
and Medical Leave Act of 1993 (29 U.S.C. 2611) is 
amended by adding at the end the following: 
‘‘(14) ACTIVE
DUTY.—The term ‘active duty’ 
means duty under a call or order to active duty 
under a provision of law referred to in section 
101(a)(13)(B) of title 10, United States Code. 
‘‘(15) COVERED
SERVICEMEMBER.—The term 
‘covered servicemember’ means a member of the
263 
Armed Forces, including a member of the National 
Guard or a Reserve, who is undergoing medical treat-
ment, recuperation, or therapy, is otherwise in med-
ical hold or medical holdover status, or is otherwise 
on the temporary disability retired list, for a serious 
injury or illness. 
‘‘(16) MEDICAL HOLD OR MEDICAL HOLDOVER 
STATUS.—The term ‘medical hold or medical holdover 
status’ means— 
‘‘(A) the status of a member of the Armed 
Forces, including a member of the National 
Guard or a Reserve, assigned or attached to a 
military hospital for medical care; and 
‘‘(B) the status of a member of a reserve 
component of the Armed Forces who is separated, 
whether 
pre-deployment 
or 
post-deployment, 
from the member’s unit while in need of health 
care based on a medical condition identified 
while the member is on active duty in the Armed 
Forces. 
‘‘(17) NEXT OF KIN.—The term ‘next of kin’, 
used with respect to an individual, means the nearest 
blood relative of that individual. 
‘‘(18) SERIOUS INJURY OR ILLNESS.—The term 
‘serious injury or illness’, in the case of a member of
264 
the Armed Forces, means an injury or illness in-
curred by the member in line of duty on active duty 
in the Armed Forces that may render the member 
medically unfit to perform the duties of the member’s 
office, grade, rank, or rating.’’. 
(2) ENTITLEMENT TO LEAVE.—Section 102(a) of 
such Act (29 U.S.C. 2612(a)) is amended by adding 
at the end the following: 
‘‘(3) SERVICEMEMBER FAMILY LEAVE.—Subject 
to section 103, an eligible employee who is the spouse, 
son, daughter, parent, or next of kin of a covered 
servicemember shall be entitled to a total of 26 work-
weeks of leave during a 12-month period to care for 
the servicemember. The leave described in this para-
graph shall only be available during a single 12- 
month period. 
‘‘(4) COMBINED LEAVE TOTAL.—During the sin-
gle 12-month period described in paragraph (3), an 
eligible employee shall be entitled to a combined total 
of 26 workweeks of leave under paragraphs (1) and 
(3). Nothing in this paragraph shall be construed to 
limit the availability of leave under paragraph (1) 
during any other 12-month period.’’. 
(3) REQUIREMENTS RELATING TO LEAVE.—
265 
(A) SCHEDULE.—Section 102(b) of such Act 
(29 U.S.C. 2612(b)) is amended— 
(i) in paragraph (1), in the second 
sentence— 
(I) by striking ‘‘section 103(b)(5)’’ 
and inserting ‘‘subsection (b)(5) or (f) 
(as appropriate) of section 103’’; and 
(II) by inserting ‘‘or under sub-
section 
(a)(3)’’ 
after 
‘‘subsection 
(a)(1)’’; and 
(ii) in paragraph (2), by inserting ‘‘or 
under subsection (a)(3)’’ after ‘‘subsection 
(a)(1)’’. 
(B) SUBSTITUTION OF PAID LEAVE.—Sec-
tion 102(d) of such Act (29 U.S.C. 2612(d)) is 
amended— 
(i) in paragraph (1)— 
(I) by inserting ‘‘(or 26 work-
weeks in the case of leave provided 
under subsection (a)(3))’’ after ‘‘12 
workweeks’’ the first place it appears; 
and 
(II) by inserting ‘‘(or 26 work-
weeks, as appropriate)’’ after ‘‘12
266 
workweeks’’ the second place it ap-
pears; and 
(ii) in paragraph (2)(B), by adding at 
the end the following: ‘‘An eligible employee 
may elect, or an employer may require the 
employee, to substitute any of the accrued 
paid vacation leave, personal leave, family 
leave, or medical or sick leave of the em-
ployee for leave provided under subsection 
(a)(3) for any part of the 26-week period of 
such leave under such subsection.’’. 
(C) NOTICE.—Section 102(e)(2) of such Act 
(29 U.S.C. 2612(e)(2)) is amended by inserting 
‘‘or under subsection (a)(3)’’ after ‘‘subsection 
(a)(1)’’. 
(D) SPOUSES
EMPLOYED
BY
SAME
EM-
PLOYER.—Section 102(f) of such Act (29 U.S.C. 
2612(f)) is amended— 
(i) by redesignating paragraphs (1) 
and (2) as subparagraphs (A) and (B), and 
aligning the margins of the subparagraphs 
with the margins of section 102(e)(2)(A); 
(ii) by striking ‘‘In any’’ and inserting 
the following: 
‘‘(1) IN GENERAL.—In any’’; and
267 
(iii) by adding at the end the fol-
lowing: 
‘‘(2) SERVICEMEMBER FAMILY LEAVE.— 
‘‘(A) IN GENERAL.—The aggregate number 
of workweeks of leave to which both that husband 
and wife may be entitled under subsection (a) 
may be limited to 26 workweeks during the sin-
gle 12-month period described in subsection 
(a)(3) if the leave is— 
‘‘(i) leave under subsection (a)(3); or 
‘‘(ii) a combination of leave under sub-
section (a)(3) and leave described in para-
graph (1). 
‘‘(B) BOTH
LIMITATIONS
APPLICABLE.—If 
the leave taken by the husband and wife includes 
leave described in paragraph (1), the limitation 
in paragraph (1) shall apply to the leave de-
scribed in paragraph (1).’’. 
(E) CERTIFICATION.—Section 103 of such 
Act (29 U.S.C. 2613) is amended by adding at 
the end the following: 
‘‘(f) CERTIFICATION
FOR SERVICEMEMBER FAMILY 
LEAVE.—An employer may require that a request for leave 
under section 102(a)(3) be supported by a certification
268 
issued at such time and in such manner as the Secretary 
may by regulation prescribe.’’. 
(F) FAILURE TO RETURN.—Section 104(c) 
of such Act (29 U.S.C. 2614(c)) is amended— 
(i) in paragraph (2)(B)(i), by insert-
ing ‘‘or under section 102(a)(3)’’ before the 
semicolon; and 
(ii) in paragraph (3)(A)— 
(I) in clause (i), by striking ‘‘or’’ 
at the end; 
(II) in clause (ii), by striking the 
period and inserting ‘‘; or’’; and 
(III) by adding at the end the fol-
lowing: 
‘‘(iii) a certification issued by the 
health care provider of the servicemember 
being cared for by the employee, in the case 
of an employee unable to return to work be-
cause of a condition specified in section 
102(a)(3).’’. 
(G) ENFORCEMENT.—Section 107 of such 
Act (29 U.S.C. 2617) is amended, in subsection 
(a)(1)(A)(i)(II), by inserting ‘‘(or 26 weeks, in a 
case involving leave under section 102(a)(3))’’ 
after ‘‘12 weeks’’.
269 
(H) INSTRUCTIONAL EMPLOYEES.—Section 
108 of such Act (29 U.S.C. 2618) is amended, in 
subsections (c)(1), (d)(2), and (d)(3), by insert-
ing ‘‘or under section 102(a)(3)’’ after ‘‘section 
102(a)(1)’’. 
(c) SERVICEMEMBER FAMILY LEAVE FOR CIVIL SERV-
ICE EMPLOYEES.— 
(1) DEFINITIONS.—Section 6381 of title 5, 
United States Code, is amended— 
(A) in paragraph (5), by striking ‘‘and’’ at 
the end; 
(B) in paragraph (6), by striking the period 
and inserting ‘‘; and’’; and 
(C) by adding at the end the following: 
‘‘(7) the term ‘active duty’ means duty under a 
call or order to active duty under a provision of law 
referred to in section 101(a)(13)(B) of title 10, United 
States Code; 
‘‘(8) the term ‘covered servicemember’ means a 
member of the Armed Forces, including a member of 
the National Guard or a Reserve, who is undergoing 
medical treatment, recuperation, or therapy, is other-
wise in medical hold or medical holdover status, or is 
otherwise on the temporary disability retired list, for 
a serious injury or illness;
270 
‘‘(9) the term ‘medical hold or medical holdover 
status’ means— 
‘‘(A) the status of a member of the Armed 
Forces, including a member of the National 
Guard or a Reserve, assigned or attached to a 
military hospital for medical care; and 
‘‘(B) the status of a member of a reserve 
component of the Armed Forces who is separated, 
whether 
pre-deployment 
or 
post-deployment, 
from the member’s unit while in need of health 
care based on a medical condition identified 
while the member is on active duty in the Armed 
Forces; 
‘‘(10) the term ‘next of kin’, used with respect to 
an individual, means the nearest blood relative of 
that individual; and 
‘‘(11) the term ‘serious injury or illness’, in the 
case of a member of the Armed Forces, means an in-
jury or illness incurred by the member in line of duty 
on active duty in the Armed Forces that may render 
the member medically unfit to perform the duties of 
the member’s office, grade, rank, or rating.’’. 
(2) ENTITLEMENT TO LEAVE.—Section 6382(a) 
of such title is amended by adding at the end the fol-
lowing:
271 
‘‘(3) Subject to section 6383, an employee who is 
the spouse, son, daughter, parent, or next of kin of a 
covered servicemember shall be entitled to a total of 
26 administrative workweeks of leave during a 12- 
month period to care for the servicemember. The leave 
described in this paragraph shall only be available 
during a single 12-month period. 
‘‘(4) During the single 12-month period described 
in paragraph (3), an employee shall be entitled to a 
combined total of 26 administrative workweeks of 
leave under paragraphs (1) and (3). Nothing in this 
paragraph shall be construed to limit the availability 
of leave under paragraph (1) during any other 12- 
month period.’’. 
(3) REQUIREMENTS RELATING TO LEAVE.— 
(A) SCHEDULE.—Section 6382(b) of such 
title is amended— 
(i) in paragraph (1), in the second 
sentence— 
(I) 
by 
striking 
‘‘section 
6383(b)(5)’’ and inserting ‘‘subsection 
(b)(5) or (f) (as appropriate) of section 
6383’’; and
272 
(II) by inserting ‘‘or under sub-
section 
(a)(3)’’ 
after 
‘‘subsection 
(a)(1)’’; and 
(ii) in paragraph (2), by inserting ‘‘or 
under subsection (a)(3)’’ after ‘‘subsection 
(a)(1)’’. 
(B) SUBSTITUTION OF PAID LEAVE.—Sec-
tion 6382(d) of such title is amended by adding 
at the end the following: ‘‘An employee may elect 
to substitute for leave under subsection (a)(3) 
any of the employee’s accrued or accumulated 
annual or sick leave under subchapter I for any 
part of the 26-week period of leave under such 
subsection.’’. 
(C) NOTICE.—Section 6382(e) of such title 
is amended by inserting ‘‘or under subsection 
(a)(3)’’ after ‘‘subsection (a)(1)’’. 
(D) CERTIFICATION.—Section 6383 of such 
title is amended by adding at the end the fol-
lowing: 
‘‘(f) An employing agency may require that a request 
for leave under section 6382(a)(3) be supported by a certifi-
cation issued at such time and in such manner as the Office 
of Personnel Management may by regulation prescribe.’’.
273 
SEC. 622. MILITARY FAMILY JOB PROTECTION. 
(a) SHORT TITLE.—This section may be cited as the 
‘‘Military Family Job Protection Act’’. 
(b) PROHIBITION
ON DISCRIMINATION
IN EMPLOY-
MENT AGAINST CERTAIN FAMILY MEMBERS CARING FOR 
RECOVERING MEMBERS OF THE ARMED FORCES.—A fam-
ily member of a recovering servicemember described in sub-
section (c) shall not be denied retention in employment, pro-
motion, or any benefit of employment by an employer on 
the basis of the family member’s absence from employment 
as described in that subsection, for a period of not more 
than 52 workweeks. 
(c) COVERED FAMILY MEMBERS.—A family member 
described in this subsection is a family member of a recov-
ering servicemember who is— 
(1) on invitational orders while caring for the 
recovering servicemember; 
(2) a non-medical attendee caring for the recov-
ering servicemember; or 
(3) receiving per diem payments from the De-
partment of Defense while caring for the recovering 
servicemember. 
(d) TREATMENT OF ACTIONS.—An employer shall be 
considered to have engaged in an action prohibited by sub-
section (b) with respect to a person described in that sub-
section if the absence from employment of the person as de-
274 
scribed in that subsection is a motivating factor in the em-
ployer’s action, unless the employer can prove that the ac-
tion would have been taken in the absence of the absence 
of employment of the person. 
(e) DEFINITIONS.—In this section: 
(1) BENEFIT OF EMPLOYMENT.—The term ‘‘ben-
efit of employment’’ has the meaning given such term 
in section 4303 of title 38, United States Code. 
(2) CARING FOR.—The term ‘‘caring for’’, used 
with respect to a recovering servicemember, means 
providing personal, medical, or convalescent care to 
the recovering servicemember, under circumstances 
that substantially interfere with an employee’s ability 
to work. 
(3) EMPLOYER.—The term ‘‘employer’’ has the 
meaning given such term in section 4303 of title 38, 
United States Code, except that the term does not in-
clude any person who is not considered to be an em-
ployer under title I of the Family and Medical Leave 
Act of 1993 (29 U.S.C. 2611 et seq.) because the per-
son does not meet the requirements of section 
101(4)(A)(i) of such Act (29 U.S.C. 2611(4)(A)(i)). 
(4) FAMILY MEMBER.—The term ‘‘family mem-
ber’’, with respect to a recovering servicemember, has
275 
the meaning given that term in section 411h(b) of 
title 37, United States Code. 
(5) RECOVERING
SERVICEMEMBER.—The term 
‘‘recovering servicemember’’ means a member of the 
Armed Forces, including a member of the National 
Guard or a Reserve, who is undergoing medical treat-
ment, recuperation, or therapy, or is otherwise in 
medical hold or medical holdover status, for an in-
jury, illness, or disease incurred or aggravated while 
on active duty in the Armed Forces. 
SEC. 623. OUTREACH REGARDING HEALTH INSURANCE OP-
TIONS AVAILABLE TO CHILDREN. 
(a) DEFINITIONS.—In this section— 
(1) the terms ‘‘Administration’’ and ‘‘Adminis-
trator’’ means the Small Business Administration 
and the Administrator thereof, respectively; 
(2) the term ‘‘certified development company’’ 
means a development company participating in the 
program under title V of the Small Business Invest-
ment Act of 1958 (15 U.S.C. 695 et seq.); 
(3) the term ‘‘Medicaid program’’ means the pro-
gram established under title XIX of the Social Secu-
rity Act (42 U.S.C. 1396 et seq.); 
(4) the term ‘‘Service Corps of Retired Execu-
tives’’ means the Service Corps of Retired Executives
276 
authorized by section 8(b)(1) of the Small Business 
Act (15 U.S.C. 637(b)(1)); 
(5) the term ‘‘small business concern’’ has the 
meaning given that term in section 3 of the Small 
Business Act (15 U.S.C. 632); 
(6) the term ‘‘small business development center’’ 
means a small business development center described 
in section 21 of the Small Business Act (15 U.S.C. 
648); 
(7) the term ‘‘State’’ has the meaning given that 
term for purposes of title XXI of the Social Security 
Act (42 U.S.C. 1397aa et seq.); 
(8) the term ‘‘State Children’s Health Insurance 
Program’’ means the State Children’s Health Insur-
ance Program established under title XXI of the So-
cial Security Act (42 U.S.C. 1397aa et seq.); 
(9) the term ‘‘task force’’ means the task force es-
tablished under subsection (b)(1); and 
(10) the term ‘‘women’s business center’’ means 
a women’s business center described in section 29 of 
the Small Business Act (15 U.S.C. 656). 
(b) ESTABLISHMENT OF TASK FORCE.— 
(1) ESTABLISHMENT.—There is established a 
task force to conduct a nationwide campaign of edu-
cation and outreach for small business concerns re-
277 
garding the availability of coverage for children 
through private insurance options, the Medicaid pro-
gram, and the State Children’s Health Insurance Pro-
gram. 
(2) MEMBERSHIP.—The task force shall consist 
of the Administrator, the Secretary of Health and 
Human Services, the Secretary of Labor, and the Sec-
retary of the Treasury. 
(3) RESPONSIBILITIES.—The campaign con-
ducted under this subsection shall include— 
(A) efforts to educate the owners of small 
business concerns about the value of health cov-
erage for children; 
(B) information regarding options available 
to the owners and employees of small business 
concerns to make insurance more affordable, in-
cluding Federal and State tax deductions and 
credits for health care-related expenses and 
health insurance expenses and Federal tax exclu-
sion for health insurance options available under 
employer-sponsored cafeteria plans under section 
125 of the Internal Revenue Code of 1986; 
(C) efforts to educate the owners of small 
business concerns about assistance available 
through public programs; and
278 
(D) efforts to educate the owners and em-
ployees of small business concerns regarding the 
availability of the hotline operated as part of the 
Insure Kids Now program of the Department of 
Health and Human Services. 
(4) IMPLEMENTATION.—In carrying out this sub-
section, the task force may— 
(A) use any business partner of the Admin-
istration, including— 
(i) a small business development cen-
ter; 
(ii) a certified development company; 
(iii) a women’s business center; and 
(iv) the Service Corps of Retired Ex-
ecutives; 
(B) enter into— 
(i) a memorandum of understanding 
with a chamber of commerce; and 
(ii) a partnership with any appro-
priate small business concern or health ad-
vocacy group; and 
(C) designate outreach programs at regional 
offices of the Department of Health and Human 
Services to work with district offices of the Ad-
ministration.
279 
(5) WEBSITE.—The Administrator shall ensure 
that links to information on the eligibility and enroll-
ment requirements for the Medicaid program and 
State Children’s Health Insurance Program of each 
State are prominently displayed on the website of the 
Administration. 
(6) REPORT.— 
(A) IN GENERAL.—Not later than 2 years 
after the date of enactment of this Act, and every 
2 years thereafter, the Administrator shall sub-
mit to the Committee on Small Business and 
Entrepreneurship of the Senate and the Com-
mittee on Small Business of the House of Rep-
resentatives a report on the status of the nation-
wide campaign conducted under paragraph (1). 
(B) CONTENTS.—Each report submitted 
under subparagraph (A) shall include a status 
update on all efforts made to educate owners and 
employees of small business concerns on options 
for providing health insurance for children 
through public and private alternatives. 
SEC. 624. SENSE OF SENATE REGARDING ACCESS TO AF-
FORDABLE AND MEANINGFUL HEALTH IN-
SURANCE COVERAGE. 
(a) FINDINGS.—The Senate finds the following:
280 
(1) There are approximately 45 million Ameri-
cans currently without health insurance. 
(2) More than half of uninsured workers are em-
ployed by businesses with less than 25 employees or 
are self-employed. 
(3) Health insurance premiums continue to rise 
at more than twice the rate of inflation for all con-
sumer goods. 
(4) Individuals in the small group and indi-
vidual health insurance markets usually pay more for 
similar coverage than those in the large group market. 
(5) The rapid growth in health insurance costs 
over the last few years has forced many employers, 
particularly small employers, to increase deductibles 
and co-pays or to drop coverage completely. 
(b) SENSE OF THE SENATE.—The Senate— 
(1) recognizes the necessity to improve afford-
ability and access to health insurance for all Ameri-
cans; 
(2) acknowledges the value of building upon the 
existing private health insurance market; and 
(3) affirms its intent to enact legislation this 
year that, with appropriate protection for consumers, 
improves access to affordable and meaningful health
282 
(b) CIGARETTES.—Section 5701(b) of such Code is 
amended— 
(1) by striking ‘‘$19.50 per thousand ($17 per 
thousand on cigarettes removed during 2000 or 
2001)’’ in paragraph (1) and inserting ‘‘$50.00 per 
thousand’’, and 
(2) by striking ‘‘$40.95 per thousand ($35.70 per 
thousand on cigarettes removed during 2000 or 
2001)’’ in paragraph (2) and inserting ‘‘$105.00 per 
thousand’’. 
(c) CIGARETTE PAPERS.—Section 5701(c) of such 
Code is amended by striking ‘‘1.22 cents (1.06 cents on ciga-
rette papers removed during 2000 or 2001)’’ and inserting 
‘‘3.13 cents’’. 
(d) CIGARETTE TUBES.—Section 5701(d) of such Code 
is amended by striking ‘‘2.44 cents (2.13 cents on cigarette 
tubes removed during 2000 or 2001)’’ and inserting ‘‘6.26 
cents’’. 
(e) SMOKELESS TOBACCO.—Section 5701(e) of such 
Code is amended— 
(1) by striking ‘‘58.5 cents (51 cents on snuff re-
moved during 2000 or 2001)’’ in paragraph (1) and 
inserting ‘‘$1.50’’, and
283 
(2) by striking ‘‘19.5 cents (17 cents on chewing 
tobacco removed during 2000 or 2001)’’ in paragraph 
(2) and inserting ‘‘50 cents’’. 
(f) PIPE TOBACCO.—Section 5701(f) of such Code is 
amended by striking ‘‘$1.0969 cents (95.67 cents on pipe 
tobacco removed during 2000 or 2001)’’ and inserting 
‘‘$2.8126 cents’’. 
(g) ROLL-YOUR-OWN TOBACCO.—Section 5701(g) of 
such Code is amended by striking ‘‘$1.0969 cents (95.67 
cents on roll-your-own tobacco removed during 2000 or 
2001)’’ and inserting ‘‘$8.8889 cents’’. 
(h) FLOOR STOCKS TAXES.— 
(1) IMPOSITION OF TAX.—On tobacco products 
(other than cigars described in section 5701(a)(2) of 
the Internal Revenue Code of 1986) and cigarette pa-
pers and tubes manufactured in or imported into the 
United States which are removed before January 1, 
2008, and held on such date for sale by any person, 
there is hereby imposed a tax in an amount equal to 
the excess of— 
(A) the tax which would be imposed under 
section 5701 of such Code on the article if the ar-
ticle had been removed on such date, over 
(B) the prior tax (if any) imposed under 
section 5701 of such Code on such article.
284 
(2) CREDIT AGAINST TAX.—Each person shall be 
allowed as a credit against the taxes imposed by 
paragraph (1) an amount equal to $500. Such credit 
shall not exceed the amount of taxes imposed by para-
graph (1) on January 1, 2008, for which such person 
is liable. 
(3) LIABILITY FOR TAX AND METHOD OF PAY-
MENT.— 
(A) LIABILITY FOR TAX.—A person holding 
tobacco products, cigarette papers, or cigarette 
tubes on January 1, 2008, to which any tax im-
posed by paragraph (1) applies shall be liable for 
such tax. 
(B) METHOD OF PAYMENT.—The tax im-
posed by paragraph (1) shall be paid in such 
manner as the Secretary shall prescribe by regu-
lations. 
(C) TIME FOR PAYMENT.—The tax imposed 
by paragraph (1) shall be paid on or before 
April 1, 2008. 
(4) ARTICLES IN FOREIGN TRADE ZONES.—Not-
withstanding the Act of June 18, 1934 (commonly 
known as the Foreign Trade Zone Act, 48 Stat. 998, 
19 U.S.C. 81a et seq.) or any other provision of law, 
any article which is located in a foreign trade zone
285 
on January 1, 2008, shall be subject to the tax im-
posed by paragraph (1) if— 
(A) internal revenue taxes have been deter-
mined, or customs duties liquidated, with respect 
to such article before such date pursuant to a re-
quest made under the 1st proviso of section 3(a) 
of such Act, or 
(B) such article is held on such date under 
the supervision of an officer of the United States 
Customs and Border Protection of the Depart-
ment of Homeland Security pursuant to the 2d 
proviso of such section 3(a). 
(5) DEFINITIONS.—For purposes of this sub-
section— 
(A) IN GENERAL.—Any term used in this 
subsection which is also used in section 5702 of 
the Internal Revenue Code of 1986 shall have the 
same meaning as such term has in such section. 
(B) SECRETARY.—The term ‘‘Secretary’’ 
means the Secretary of the Treasury or the Sec-
retary’s delegate. 
(6) CONTROLLED GROUPS.—Rules similar to the 
rules of section 5061(e)(3) of such Code shall apply 
for purposes of this subsection.
286 
(7) OTHER LAWS APPLICABLE.—All provisions of 
law, including penalties, applicable with respect to 
the taxes imposed by section 5701 of such Code shall, 
insofar as applicable and not inconsistent with the 
provisions of this subsection, apply to the floor stocks 
taxes imposed by paragraph (1), to the same extent 
as if such taxes were imposed by such section 5701. 
The Secretary may treat any person who bore the ul-
timate burden of the tax imposed by paragraph (1) 
as the person to whom a credit or refund under such 
provisions may be allowed or made. 
(i) EFFECTIVE DATE.—The amendments made by this 
section shall apply to articles removed (as defined in section 
5702(j) of the Internal Revenue Code of 1986) after Decem-
ber 31, 2007. 
SEC. 702. ADMINISTRATIVE IMPROVEMENTS. 
(a) PERMIT, REPORT, AND RECORD REQUIREMENTS 
FOR MANUFACTURERS AND IMPORTERS OF PROCESSED TO-
BACCO.— 
(1) PERMITS.— 
(A) APPLICATION.—Section 5712 of the In-
ternal Revenue Code of 1986 is amended by in-
serting ‘‘or processed tobacco’’ after ‘‘tobacco 
products’’.
287 
(B) ISSUANCE.—Section 5713(a) of such 
Code is amended by inserting ‘‘or processed to-
bacco’’ after ‘‘tobacco products’’. 
(2) INVENTORIES AND REPORTS.— 
(A) INVENTORIES.—Section 5721 of such 
Code is amended by inserting ‘‘, processed to-
bacco,’’ after ‘‘tobacco products’’. 
(B) REPORTS.—Section 5722 of such Code 
is amended by inserting ‘‘, processed tobacco,’’ 
after ‘‘tobacco products’’. 
(3) RECORDS.—Section 5741 of such Code is 
amended by inserting ‘‘, processed tobacco,’’ after ‘‘to-
bacco products’’. 
(4) MANUFACTURER OF PROCESSED TOBACCO.— 
Section 5702 of such Code is amended by adding at 
the end the following new subsection: 
‘‘(p) MANUFACTURER OF PROCESSED TOBACCO.— 
‘‘(1) IN GENERAL.—The term ‘manufacturer of 
processed tobacco’ means any person who processes 
any tobacco other than tobacco products. 
‘‘(2) PROCESSED TOBACCO.—The processing of 
tobacco shall not include the farming or growing of 
tobacco or the handling of tobacco solely for sale, ship-
ment, or delivery to a manufacturer of tobacco prod-
ucts or processed tobacco.’’.
288 
(5) CONFORMING AMENDMENT.—Section 5702(k) 
of such Code is amended by inserting ‘‘, or any proc-
essed tobacco,’’ after ‘‘nontaxpaid tobacco products or 
cigarette papers or tubes’’. 
(6) EFFECTIVE DATE.—The amendments made 
by this subsection shall take effect on January 1, 
2008. 
(b) BASIS FOR DENIAL, SUSPENSION, OR REVOCATION 
OF PERMITS.— 
(1) DENIAL.—Paragraph (3) of section 5712 of 
such Code is amended to read as follows: 
‘‘(3) such person (including, in the case of a cor-
poration, any officer, director, or principal stock-
holder and, in the case of a partnership, a partner)— 
‘‘(A) is, by reason of his business experience, 
financial standing, or trade connections or by 
reason of previous or current legal proceedings 
involving a felony violation of any other provi-
sion of Federal criminal law relating to tobacco 
products, cigarette paper, or cigarette tubes, not 
likely to maintain operations in compliance with 
this chapter, 
‘‘(B) has been convicted of a felony violation 
of any provision of Federal or State criminal
289 
law relating to tobacco products, cigarette paper, 
or cigarette tubes, or 
‘‘(C) has failed to disclose any material in-
formation required or made any material false 
statement in the application therefor.’’. 
(2) SUSPENSION
OR
REVOCATION.—Subsection 
(b) of section 5713 of such Code is amended to read 
as follows: 
‘‘(b) SUSPENSION OR REVOCATION.— 
‘‘(1) SHOW CAUSE HEARING.—If the Secretary 
has reason to believe that any person holding a per-
mit— 
‘‘(A) has not in good faith complied with 
this chapter, or with any other provision of this 
title involving intent to defraud, 
‘‘(B) has violated the conditions of such per-
mit, 
‘‘(C) has failed to disclose any material in-
formation required or made any material false 
statement in the application for such permit, 
‘‘(D) has failed to maintain his premises in 
such manner as to protect the revenue, 
‘‘(E) is, by reason of previous or current 
legal proceedings involving a felony violation of 
any other provision of Federal criminal law re-
290 
lating to tobacco products, cigarette paper, or 
cigarette tubes, not likely to maintain operations 
in compliance with this chapter, or 
‘‘(F) has been convicted of a felony violation 
of any provision of Federal or State criminal 
law relating to tobacco products, cigarette paper, 
or cigarette tubes, 
the Secretary shall issue an order, stating the facts 
charged, citing such person to show cause why his 
permit should not be suspended or revoked. 
‘‘(2) ACTION
FOLLOWING
HEARING.—If, after 
hearing, the Secretary finds that such person has not 
shown cause why his permit should not be suspended 
or revoked, such permit shall be suspended for such 
period as the Secretary deems proper or shall be re-
voked.’’. 
(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall take effect on the date of the 
enactment of this Act. 
(c) APPLICATION OF INTERNAL REVENUE CODE STAT-
UTE OF LIMITATIONS FOR ALCOHOL AND TOBACCO EXCISE 
TAXES.— 
(1) IN GENERAL.—Section 514(a) of the Tariff 
Act of 1930 (19 U.S.C. 1514(a)) is amended by strik-
ing ‘‘and section 520 (relating to refunds)’’ and in-
291 
serting ‘‘section 520 (relating to refunds), and section 
6501 of the Internal Revenue Code of 1986 (but only 
with respect to taxes imposed under chapters 51 and 
52 of such Code)’’. 
(2) EFFECTIVE DATE.—The amendment made by 
this subsection shall apply to articles imported after 
the date of the enactment of this Act. 
(d) EXPANSION OF DEFINITION OF ROLL-YOUR-OWN 
TOBACCO.— 
(1) IN GENERAL.—Section 5702(o) of the Inter-
nal Revenue Code of 1986 is amended by inserting 
‘‘or cigars, or for use as wrappers thereof’’ before the 
period at the end. 
(2) EFFECTIVE DATE.—The amendment made by 
this subsection shall apply to articles removed (as de-
fined in section 5702(j) of the Internal Revenue Code 
of 1986) after December 31, 2007. 
(e) TIME OF TAX FOR UNLAWFULLY MANUFACTURED 
TOBACCO PRODUCTS.— 
(1) IN
GENERAL.—Section 5703(b)(2) of such 
Code is amended by adding at the end the following 
new subparagraph: 
‘‘(F) SPECIAL RULE FOR UNLAWFULLY MAN-
UFACTURED TOBACCO PRODUCTS.—In the case of 
any tobacco products, cigarette paper, or ciga-
292 
rette tubes produced in the United States at any 
place other than the premises of a manufacturer 
of tobacco products, cigarette paper, or cigarette 
tubes that has filed the bond and obtained the 
permit required under this chapter, tax shall be 
due and payable immediately upon manufac-
ture.’’. 
(2) EFFECTIVE DATE.—The amendment made by 
this subsection shall take effect on the date of the en-
actment of this Act. 
SEC. 703. TIME FOR PAYMENT OF CORPORATE ESTIMATED 
TAXES. 
Subparagraph (B) of section 401(1) of the Tax In-
crease Prevention and Reconciliation Act of 2005 is amend-
ed by striking ‘‘114.75 percent’’ and inserting ‘‘113.75 per-
cent’’. 
In lieu of the matter proposed to be inserted by the 
Senate amendment to the title of the bill, insert the fol-
lowing: ‘‘An Act to amend title XXI of the Social Secu-
rity Act to extend and improve the Children’s Health In-
surance Program, and for other purposes.’’. 
Attest: 
Clerk.
110TH CONGRESS 
1ST SESSION 
H. R. 976 
HOUSE AMENDMENTS 
TO SENATE 
AMENDMENTS