H. R. 3130—12
any overpayments or underpayments which the Secretary deter-
mines were made under this section to the States involved for
prior periods and with respect to which adjustment has not already
been made under this subsection. Upon the making of any estimate
by the Secretary under the preceding sentence, any appropriations
available for payments under this section are deemed obligated.
‘‘(e) REGULATIONS.—The Secretary shall prescribe such regula-
tions as may be necessary governing the calculation of incentive
payments under this section, including directions for excluding from
the calculations certain closed cases and cases over which the
States do not have jurisdiction.
‘‘(f ) REINVESTMENT.—A State to which a payment is made
under this section shall expend the full amount of the payment
to supplement, and not supplant, other funds used by the State—
‘‘(1) to carry out the State plan approved under this
part; or
‘‘(2) for any activity (including cost-effective contracts with
local agencies) approved by the Secretary, whether or not the
expenditures for the activity are eligible for reimbursement
under this part, which may contribute to improving the
effectiveness or efficiency of the State program operated under
this part.’’.
(b) TRANSITION RULE.—Notwithstanding any other provision
of law—
(1) for fiscal year 2000, the Secretary shall reduce by one-
third the amount otherwise payable to a State under section
458 of the Social Security Act, and shall reduce by two-thirds
the amount otherwise payable to a State under section 458A
of such Act; and
(2) for fiscal year 2001, the Secretary shall reduce by two-
thirds the amount otherwise payable to a State under section
458 of the Social Security Act, and shall reduce by one-third
the amount otherwise payable to a State under section 458A
of such Act.
(c) REGULATIONS.—Within 9 months after the date of the enact-
ment of this section, the Secretary of Health and Human Services
shall prescribe regulations governing the implementation of section
458A of the Social Security Act when such section takes effect
and the implementation of subsection (b) of this section.
(d) STUDIES.—
(1) GENERAL REVIEW OF NEW INCENTIVE PAYMENT SYSTEM.—
(A) IN GENERAL.—The Secretary of Health and Human
Services shall conduct a study of the implementation of
the incentive payment system established by section 458A
of the Social Security Act, in order to identify the problems
and successes of the system.
(B) REPORTS TO THE CONGRESS.—
(i) REPORT ON VARIATIONS IN STATE PERFORMANCE
ATTRIBUTABLE TO DEMOGRAPHIC VARIABLES.—Not later
than October 1, 2000, the Secretary shall submit to
the Congress a report that identifies any demographic
or economic variables that account for differences in
the performance levels achieved by the States with
respect to the performance measures used in the sys-
tem, and contains the recommendations of the Sec-
retary for such adjustments to the system as may
be necessary to ensure that the relative performance
H. R. 3130—13
of States is measured from a baseline that takes
account of any such variables.
(ii) INTERIM
REPORT.—Not later than March 1,
2001, the Secretary shall submit to the Congress an
interim report that contains the findings of the study
required by subparagraph (A).
(iii) FINAL
REPORT.—Not later than October 1,
2003, the Secretary shall submit to the Congress a
final report that contains the final findings of the
study required by subparagraph (A). The report shall
include any recommendations for changes in the sys-
tem that the Secretary determines would improve the
operation of the child support enforcement program.
(2) DEVELOPMENT OF MEDICAL SUPPORT INCENTIVE.—
(A) IN GENERAL.—The Secretary of Health and Human
Services, in consultation with State directors of programs
operated under part D of title IV of the Social Security
Act and representatives of children potentially eligible for
medical support, shall develop a performance measure
based on the effectiveness of States in establishing and
enforcing medical support obligations, and shall make rec-
ommendations for the incorporation of the measure, in
a revenue neutral manner, into the incentive payment sys-
tem established by section 458A of the Social Security
Act.
(B) REPORT.—Not later than October 1, 1999, the Sec-
retary shall submit to the Congress a report that describes
the performance measure and contains the recommenda-
tions required by subparagraph (A).
(e) TECHNICAL AMENDMENTS.—
(1) IN GENERAL.—Section 341 of the Personal Responsibility
and Work Opportunity Reconciliation Act of 1996 (42 U.S.C.
658 note) is amended—
(A) by striking subsection (a) and redesignating sub-
sections (b), (c), and (d) as subsections (a), (b), and (c),
respectively; and
(B) in subsection (c) (as so redesignated)—
(i) by striking paragraph (1) and inserting the
following:
‘‘(1) CONFORMING AMENDMENTS TO PRESENT SYSTEM.—The
amendments made by subsection (a) of this section shall become
effective with respect to a State as of the date the amendments
made by section 103(a) (without regard to section 116(a)(2))
first apply to the State.’’; and
(ii) in paragraph (2), by striking ‘‘(c)’’ and inserting
‘‘(b)’’.
(2) EFFECTIVE
DATE.—The amendments made by this
subsection shall take effect as if included in the enactment
of section 341 of the Personal Responsibility and Work Oppor-
tunity Reconciliation Act of 1996.
(f ) 
ELIMINATION
OF
PREDECESSOR
INCENTIVE
PAYMENT
SYSTEM.—
(1) REPEAL.—Section 458 of the Social Security Act (42
U.S.C. 658) is repealed.
(2) CONFORMING AMENDMENTS.—
H. R. 3130—14
(A) Section 458A of the Social Security Act, as added
by section 201(a) of this Act, is redesignated as section
458.
(B) Section 455(a)(4)(C)(iii) of such Act (42 U.S.C.
655(a)(4)(C)(iii)), as added by section 101(a) of this Act,
is amended—
(i) 
by 
striking 
‘‘458A(b)(4)’’ 
and 
inserting
‘‘458(b)(4)’’;
(ii) 
by 
striking 
‘‘458A(b)(6)’’ 
and 
inserting
‘‘458(b)(6)’’; and
(iii) by striking ‘‘458A(b)(5)(B)’’ and inserting
‘‘458(b)(5)(B)’’.
(C) Subsection (d)(1) of this section is amended by
striking ‘‘458A’’ and inserting ‘‘458’’.
(3) EFFECTIVE
DATE.—The amendments made by this
subsection shall take effect on October 1, 2001.
(g) GENERAL EFFECTIVE DATE.—Except as otherwise provided
in this section, the amendments made by this section shall take
effect on October 1, 1999.
TITLE III—ADOPTION PROVISIONS
SEC. 301. MORE FLEXIBLE PENALTY PROCEDURE TO BE APPLIED FOR
FAILING TO PERMIT INTERJURISDICTIONAL ADOPTION.
(a) CONVERSION OF FUNDING BAN INTO STATE PLAN REQUIRE-
MENT.—Section 471(a) of the Social Security Act (42 U.S.C. 671(a))
is amended—
(1) by striking ‘‘and’’ at the end of paragraph (21);
(2) by striking the period at the end of paragraph (22)
and inserting ‘‘; and’’; and
(3) by adding at the end the following:
‘‘(23) provides that the State shall not—
‘‘(A) deny or delay the placement of a child for adoption
when an approved family is available outside of the
jurisdiction with responsibility for handling the case of
the child; or
‘‘(B) fail to grant an opportunity for a fair hearing,
as described in paragraph (12), to an individual whose
allegation of a violation of subparagraph (A) of this para-
graph is denied by the State or not acted upon by the
State with reasonable promptness.’’.
(b) PENALTY FOR NONCOMPLIANCE.—Section 474(d) of such Act
(42 U.S.C. 674(d)) is amended in each of paragraphs (1) and (2)
by striking ‘‘section 471(a)(18)’’ and inserting ‘‘paragraph (18) or
(23) of section 471(a)’’.
(c) CONFORMING AMENDMENT.—Section 474 of such Act (42
U.S.C. 674) is amended by striking subsection (e).
(d) RETROACTIVITY.—The amendments made by this section
shall take effect as if included in the enactment of section 202
of the Adoption and Safe Families Act of 1997 (Public Law 105–
89; 111 Stat. 2125).
H. R. 3130—15
TITLE IV—MISCELLANEOUS
SEC. 401. ELIMINATION OF BARRIERS TO THE EFFECTIVE ESTABLISH-
MENT AND ENFORCEMENT OF MEDICAL CHILD SUPPORT.
(a) STUDY ON EFFECTIVENESS OF ENFORCEMENT OF MEDICAL
SUPPORT BY STATE AGENCIES.—
(1) MEDICAL CHILD SUPPORT WORKING GROUP.—Within 60
days after the date of the enactment of this Act, the Secretary
of Health and Human Services and the Secretary of Labor
shall jointly establish a Medical Child Support Working Group.
The purpose of the Working Group shall be to identify the
impediments to the effective enforcement of medical support
by State agencies administering the programs operated pursu-
ant to part D of title IV of the Social Security Act.
(2) MEMBERSHIP.—The Working Group shall consist of not
more than 30 members and shall be composed of representa-
tives of—
(A) the Department of Labor;
(B) the Department of Health and Human Services;
(C) State directors of programs under part D of title
IV of the Social Security Act;
(D) State directors of the Medicaid program under
title XIX of the Social Security Act;
(E) employers, including owners of small businesses
and their trade or industry representatives and certified
human resource and payroll professionals;
(F) plan administrators and plan sponsors of group
health plans (as defined in section 607(1) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1167(1));
(G) children potentially eligible for medical support,
such as child advocacy organizations;
(H) State medical child support programs; and
(I) organizations representing State child support
programs.
(3) COMPENSATION.—The members shall serve without
compensation.
(4) ADMINISTRATIVE SUPPORT.—The Department of Health
and Human Services and the Department of Labor shall jointly
provide appropriate administrative support to the Working
Group, including technical assistance. The Working Group may
use the services and facilities of either such Department, with
or without reimbursement, as jointly determined by such
Departments.
(5) REPORT.—
(A) REPORT BY WORKING GROUP TO THE SECRETARIES.—
Not later than 18 months after the date of the enactment
of this Act, the Working Group shall submit to the Sec-
retary of Labor and the Secretary of Health and Human
Services a report containing recommendations for appro-
priate measures to address the impediments to the effective
enforcement of medical support by State agencies admin-
istering the programs operated pursuant to part D of title
IV of the Social Security Act identified by the Working
Group, including—
H. R. 3130—16
(i) recommendations based on assessments of the
form and content of the National Medical Support
Notice, as issued under interim regulations;
(ii) appropriate measures that establish the prior-
ity of withholding of child support obligations, medical
support obligations, arrearages in such obligations, and
in the case of a medical support obligation, the employ-
ee’s portion of any health care coverage premium, by
such State agencies in light of the restrictions on
garnishment provided under title III of the Consumer
Credit Protection Act (15 U.S.C. 1671–1677);
(iii) appropriate procedures for coordinating the
provision, enforcement, and transition of health care
coverage under the State programs operated pursuant
to part D of title IV of the Social Security Act and
titles XIX and XXI of such Act;
(iv) appropriate measures to improve the availabil-
ity of alternate types of medical support that are aside
from health coverage offered through the noncustodial
parent’s health plan and unrelated to the noncustodial
parent’s employer, including measures that establish
a noncustodial parent’s responsibility to share the cost
of premiums, co-payments, deductibles, or payments
for services not covered under a child’s existing health
coverage;
(v) recommendations on whether reasonable cost
should remain a consideration under section 452(f )
of the Social Security Act; and
(vi) appropriate measures for eliminating any other
impediments to the effective enforcement of medical
support orders that the Working Group deems nec-
essary.
(B) REPORT BY SECRETARIES TO THE CONGRESS.—Not
later than 2 months after receipt of the report pursuant
to subparagraph (A), the Secretaries shall jointly submit
a report to each House of the Congress regarding the
recommendations contained in the report under subpara-
graph (A).
(6) TERMINATION.—The Working Group shall terminate 30
days after the date of the issuance of its report under paragraph
(5).
(b) PROMULGATION OF NATIONAL MEDICAL SUPPORT NOTICE.—
(1) IN
GENERAL.—The Secretary of Health and Human
Services and the Secretary of Labor shall jointly develop and
promulgate by regulation a National Medical Support Notice,
to be issued by States as a means of enforcing the health
care coverage provisions in a child support order.
(2) REQUIREMENTS.—The National Medical Support Notice
shall—
(A) conform with the requirements which apply to
medical child support orders under section 609(a)(3) of
the Employee Retirement Income Security Act of 1974 (29
U.S.C. 1169(a)(3)) in connection with group health plans
(subject to section 609(a)(4) of such Act), irrespective of
whether the group health plan is covered under section
4 of such Act;
H. R. 3130—17
(B) conform with the requirements of part D of title
IV of the Social Security Act; and
(C) include a separate and easily severable employer
withholding notice, informing the employer of—
(i) applicable provisions of State law requiring the
employer to withhold any employee contributions due
under any group health plan in connection with
coverage required to be provided under such order;
(ii) the duration of the withholding requirement;
(iii) the applicability of limitations on any such
withholding under title III of the Consumer Credit
Protection Act;
(iv) the applicability of any prioritization required
under State law between amounts to be withheld for
purposes of cash support and amounts to be withheld
for purposes of medical support, in cases where avail-
able funds are insufficient for full withholding for both
purposes; and
(v) the name and telephone number of the appro-
priate unit or division to contact at the State agency
regarding the National Medical Support Notice.
(3) PROCEDURES.—The regulations promulgated pursuant
to paragraph (1) shall include appropriate procedures for the
transmission of the National Medical Support Notice to employ-
ers by State agencies administering the programs operated
pursuant to part D of title IV of the Social Security Act.
(4) INTERIM REGULATIONS.—Not later than 10 months after
the date of the enactment of this Act, the Secretaries shall
issue interim regulations providing for the National Medical
Support Notice.
(5) FINAL REGULATIONS.—Not later than 1 year after the
issuance of the interim regulations under paragraph (4), the
Secretary of Health and Human Services and the Secretary
of Labor shall jointly issue final regulations providing for the
National Medical Support Notice.
(c) REQUIRED USE BY STATES OF NATIONAL MEDICAL SUPPORT
NOTICES.—
(1) STATE PROCEDURES.—Section 466(a)(19) of the Social
Security Act (42 U.S.C. 666(a)(19)) is amended to read as
follows:
‘‘(19) HEALTH CARE COVERAGE.—Procedures under which—
‘‘(A) effective as provided in section 401(c)(3) of the
Child Support Performance and Incentive Act of 1998, all
child support orders enforced pursuant to this part which
include a provision for the health care coverage of the
child are enforced, where appropriate, through the use
of the National Medical Support Notice promulgated pursu-
ant to section 401(b) of the Child Support Performance
and Incentive Act of 1998 (and referred to in section
609(a)(5)(C) of the Employee Retirement Income Security
Act of 1974 in connection with group health plans covered
under title I of such Act, in section 401(e)(3)(C) of the
Child Support Performance and Incentive Act of 1998 in
connection with State or local group health plans, and
in section 401(f )(5)(C) of such Act in connection with church
group health plans);
H. R. 3130—18
‘‘(B) unless alternative coverage is allowed for in any
order of the court (or other entity issuing the child support
order), in any case in which a noncustodial parent is
required under the child support order to provide such
health care coverage and the employer of such noncustodial
parent is known to the State agency—
‘‘(i) the State agency uses the National Medical
Support Notice to transfer notice of the provision for
the health care coverage of the child to the employer;
‘‘(ii) within 20 business days after the date of the
National Medical Support Notice, the employer is
required to transfer the Notice, excluding the severable
employer withholding notice described in section
401(b)(2)(C) of the Child Support Performance and
Incentive Act of 1998, to the appropriate plan providing
any such health care coverage for which the child
is eligible;
‘‘(iii) in any case in which the noncustodial parent
is a newly hired employee entered in the State Direc-
tory of New Hires pursuant to section 453A(e), the
State agency provides, where appropriate, the National
Medical Support Notice, together with an income
withholding notice issued pursuant to section 466(b),
within two days after the date of the entry of such
employee in such Directory; and
‘‘(iv) in any case in which the employment of the
noncustodial parent with any employer who has
received a National Medical Support Notice is termi-
nated, such employer is required to notify the State
agency of such termination; and
‘‘(C) any liability of the noncustodial parent to such
plan for employee contributions which are required under
such plan for enrollment of the child is effectively subject
to appropriate enforcement, unless the noncustodial parent
contests such enforcement based on a mistake of fact.’’.
(2) CONFORMING AMENDMENTS.—Section 452(f ) of such Act
(42 U.S.C. 652(f )) is amended in the first sentence—
(A) by striking ‘‘petition for the inclusion of ’’ and
inserting ‘‘include’’; and
(B) by inserting ‘‘and enforce medical support’’ before
‘‘whenever’’.
(3) EFFECTIVE DATE.—The amendments made by this sub-
section shall be effective with respect to periods beginning
on or after the later of—
(A) October 1, 2001; or
(B) the effective date of laws enacted by the legislature
of such State implementing such amendments,
but in no event later than the first day of the first calendar
quarter beginning after the close of the first regular session
of the State legislature that begins after the date of the enact-
ment of this Act. For purposes of the preceding sentence, in
the case of a State that has a 2-year legislative session, each
year of such session shall be deemed to be a separate regular
session of the State legislature.
(d) NATIONAL
MEDICAL
SUPPORT
NOTICE
DEEMED
UNDER
ERISA A QUALIFIED MEDICAL CHILD SUPPORT ORDER.—Section
609(a)(5) of the Employee Retirement Income Security Act of 1974
H. R. 3130—19
(29 U.S.C. 1169(a)(5)) is amended by adding at the end the follow-
ing:
‘‘(C) NATIONAL MEDICAL SUPPORT NOTICE DEEMED TO
BE A QUALIFIED MEDICAL CHILD SUPPORT ORDER.—
‘‘(i) IN GENERAL.—If the plan administrator of a
group health plan which is maintained by the employer
of a noncustodial parent of a child or to which such
an employer contributes receives an appropriately com-
pleted National Medical Support Notice promulgated
pursuant to section 401(b) of the Child Support
Performance and Incentive Act of 1998 in the case
of such child, and the Notice meets the requirements
of paragraphs (3) and (4), the Notice shall be deemed
to be a qualified medical child support order in the
case of such child.
‘‘(ii) ENROLLMENT OF CHILD IN PLAN.—In any case
in which an appropriately completed National Medical
Support Notice is issued in the case of a child of
a participant under a group health plan who is a
noncustodial parent of the child, and the Notice is
deemed under clause (i) to be a qualified medical child
support order, the plan administrator, within 40 busi-
ness days after the date of the Notice, shall—
‘‘(I) notify the State agency issuing the Notice
with respect to such child whether coverage of
the child is available under the terms of the plan
and, if so, whether such child is covered under
the plan and either the effective date of the cov-
erage or, if necessary, any steps to be taken by
the custodial parent (or by the official of a State
or political subdivision thereof substituted for the
name of such child pursuant to paragraph (3)(A))
to effectuate the coverage; and
‘‘(II) provide to the custodial parent (or such
substituted official) a description of the coverage
available and any forms or documents necessary
to effectuate such coverage.
‘‘(iii) RULE
OF
CONSTRUCTION.—Nothing in this
subparagraph shall be construed as requiring a group
health plan, upon receipt of a National Medical Support
Notice, to provide benefits under the plan (or eligibility
for such benefits) in addition to benefits (or eligibility
for benefits) provided under the terms of the plan
as of immediately before receipt of such Notice.’’.
(e) NATIONAL MEDICAL SUPPORT NOTICES FOR STATE OR LOCAL
GOVERNMENTAL GROUP HEALTH PLANS.—
(1) IN GENERAL.—Each State or local governmental group
health plan shall provide benefits in accordance with the
applicable requirements of any National Medical Support
Notice.
(2) ENROLLMENT OF CHILD IN PLAN.—In any case in which
an appropriately completed National Medical Support Notice
is issued in the case of a child of a participant under a State
or local governmental group health plan who is a noncustodial
parent of the child, the plan administrator, within 40 business
days after the date of the Notice, shall—
H. R. 3130—20
(A) notify the State agency issuing the Notice with
respect to such child whether coverage of the child is avail-
able under the terms of the plan and, if so, whether such
child is covered under the plan and either the effective
date of the coverage or any steps necessary to be taken
by the custodial parent (or by any official of a State or
political subdivision thereof substituted in the Notice for
the name of such child in accordance with procedures
appliable under subsection (b)(2) of this section) to effec-
tuate the coverage; and
(B) provide to the custodial parent (or such substituted
official) a description of the coverage available and any
forms or documents necessary to effectuate such coverage.
(3) RULE OF CONSTRUCTION.—Nothing in this subsection
shall be construed as requiring a State or local governmental
group health plan, upon receipt of a National Medical Support
Notice, to provide benefits under the plan (or eligibility for
such benefits) in addition to benefits (or eligibility for benefits)
provided under the terms of the plan as of immediately before
receipt of such Notice.
(4) DEFINITIONS.—For purposes of this subsection—
(A) STATE OR LOCAL GOVERNMENTAL GROUP HEALTH
PLAN.—The term ‘‘State or local governmental group health
plan’’ means a group health plan which is established
or maintained for its employees by the government of any
State, any political subdivision of a State, or any agency
or instrumentality of either of the foregoing.
(B) ALTERNATE RECIPIENT.—The term ‘‘alternate recipi-
ent’’ means any child of a participant who is recognized
under a National Medical Support Notice as having a right
to enrollment under a State or local governmental group
health plan with respect to such participant.
(C) GROUP
HEALTH
PLAN.—The term ‘‘group health
plan’’ has the meaning provided in section 607(1) of the
Employee Retirement Income Security Act of 1974.
(D) STATE.—The term ‘‘State’’ includes the District of
Columbia, the Commonwealth of Puerto Rico, the Virgin
Islands, Guam, and American Samoa.
(E) OTHER
TERMS.—The terms ‘‘participant’’ and
‘‘administrator’’ shall have the meanings provided such
terms, respectively, by paragraphs (7) and (16) of section
3 of the Employee Retirement Income Security Act of 1974.
(5) EFFECTIVE
DATE.—The provisions of this subsection
shall take effect on the date of the issuance of interim regula-
tions pursuant to subsection (b)(4) of this section.
(f ) QUALIFIED MEDICAL CHILD SUPPORT ORDERS AND NATIONAL
MEDICAL SUPPORT NOTICES FOR CHURCH PLANS.—
(1) IN GENERAL.—Each church group health plan shall pro-
vide benefits in accordance with the applicable requirements
of any qualified medical child support order. A qualified medical
child support order with respect to any participant or bene-
ficiary shall be deemed to apply to each such group health
plan which has received such order, from which the participant
or beneficiary is eligible to receive benefits, and with respect
to which the requirements of paragraph (4) are met.
(2) DEFINITIONS.—For purposes of this subsection—