‘‘(A) IN GENERAL.—In the case of a State 
that meets the condition described in subpara-
graph (B) (relating to agreeing to implement 
administrative enrollment policies under this 
title and title XIX) for a fiscal year, the Fed-
eral medical assistance percentage (for purposes 
of title XIX only) and the enhanced FMAP (for 
purposes of this title, but determined without 
regard to the application of this subsection to 
the Federal medical assistance percentage 
under title XIX) otherwise computed for such 
fiscal year as applied to medical assistance for 
children and child health assistance, respec-
tively, shall be increased by 2 percentage points. 
‘‘(B) AGREEING TO REMOVE ENROLLMENT 
AND
ACCESS
BARRIERS.—The condition de-
scribed in this subparagraph, for a State for a 
fiscal year is that the State agrees to do the fol-
lowing: 
‘‘(i) PRESUMPTIVE
ELIGIBILITY
FOR 
CHILDREN.—The State agrees— 
‘‘(I) to provide presumptive eligi-
bility for children under this title and 
title XIX in accordance with section 
1920A; and 
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‘‘(II) to treat any items or serv-
ices that are provided to an uncovered 
child 
(as 
defined 
in 
section 
2110(c)(8)) who is determined ineli-
gible for medical assistance under title 
XIX as child health assistance for 
purposes of paying a provider of such 
items or services, so long as such 
items or services would be considered 
child health assistance for a targeted 
low-income child under this title. 
‘‘(ii) 12-MONTH
CONTINUOUS
ELIGI-
BILITY.—The State agrees to provide that 
eligibility of children for assistance under 
this title and title XIX shall not be regu-
larly redetermined more often than once 
every year. 
‘‘(iii) 
AUTOMATIC
RENEWAL.—The 
State agrees to provide for the automatic 
renewal of the eligibility of children for as-
sistance under this title and under title 
XIX if the child’s family does not report 
any changes to family income or other rel-
evant circumstances, subject to verification 
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of information from databases available to 
the State for such purpose. 
‘‘(iv) ELIMINATION OF ASSET TEST.— 
The State has amended its plans under 
this title and title XIX so that no asset or 
resource test is applied for eligibility under 
this title or title XIX with respect to chil-
dren. 
‘‘(v) ADMINISTRATIVE
VERIFICATION 
OF INCOME.—The State agrees to permit 
the family of a child applying for child 
health assistance under this title or med-
ical assistance under title XIX to declare 
and certify, by signature under penalty of 
perjury, the family income for purposes of 
collecting financial eligibility information.’’. 
(b) CONFORMING MEDICAID AMENDMENTS.— 
(1) IN GENERAL.—Section 1905(b) of the So-
cial Security Act (42 U.S.C. 1396d(b)) is amended 
by inserting ‘‘and section 2102(d)(1)’’ after ‘‘section 
1933(d)’’. 
(2) INCREASE IN MEDICAID CAP FOR TERRI-
TORIES.—Section 1108(g) of such Act (42 U.S.C. 
1308(g)) is amended— 
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(A) in paragraph (2), by striking ‘‘para-
graph (3)’’ and inserting ‘‘paragraphs (3) and 
(4)’’; and 
(B) by adding at the end the following new 
paragraph: 
‘‘(4) DISREGARD
OF
INCREASED
EXPENDI-
TURES DIRECTLY ATTRIBUTABLE TO INCREASE IN 
FMAP FOR APPLICATION OF STREAMLINED ENROLL-
MENT PROCEDURES.—The limitation of paragraph 
(2) shall not apply to payment under title XIX to a 
territory insofar as such payment is attributable to 
an increase in the Federal medical assistance per-
centage 
under 
subparagraph 
(A) 
of 
section 
2102(d)(1).’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply beginning with fiscal year 2007. 
SEC. 202. STATE OPTION TO PROVIDE FOR ‘‘EXPRESS LANE’’ 
AND SIMPLIFIED DETERMINATIONS OF A 
CHILD’S FINANCIAL ELIGIBILITY FOR MED-
ICAL 
ASSISTANCE 
UNDER 
MEDICAID 
OR 
CHILD HEALTH ASSISTANCE UNDER SCHIP. 
(a) MEDICAID.—Section 1902(e) of the Social Secu-
rity Act (42 U.S.C. 1396a(e)) is amended by adding at 
the end the following: 
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‘‘(13)(A) At the option of the State, the plan may 
provide that eligibility requirements (including such re-
quirements applicable to redeterminations or renewals of 
eligibility) for medical assistance relating to income, assets 
(or resources), or citizenship status are met for a child 
who is under an age specified by the State (not to exceed 
21 years of age) by using a determination made within 
a reasonable period (as determined by the State) before 
its use for this purpose, of the child’s family or household 
income, or if applicable for purposes of determining eligi-
bility under this title or title XXI, assets or resources, or 
citizenship status, respectively, (notwithstanding any other 
provision of law, including sections 1902(a)(46)(B), 
1903(x), and 1137(d)), by a Federal or State agency, or 
a public or private entity making such determination on 
behalf of such agency, specified by the plan, including an 
agency administering the State program funded under 
part A of title IV, the Food Stamp Act of 1977, the Rich-
ard B. Russell National School Lunch Act, or the Child 
Nutrition Act of 1966, notwithstanding any differences in 
budget unit, disregard, deeming, or other methodology, 
but only if— 
‘‘(i) the agency has fiscal liabilities or respon-
sibilities affected by such determination; and 
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‘‘(ii) the agency or entity notifies the child’s 
family— 
‘‘(I) of the information which shall be dis-
closed in accordance with this subparagraph; 
‘‘(II) that the information disclosed will be 
used solely for purposes of determining eligi-
bility for medical assistance under this title or 
for child health assistance under title XXI; and 
‘‘(III) that interagency agreements limit 
the use of such information to that purpose; 
and 
‘‘(iii) the requirements of section 1939 are sat-
isfied. 
‘‘(B) Nothing in this paragraph shall be construed 
to relieve a State of the obligation to determine, on an-
other basis, eligibility for medical assistance under this 
title or for child health assistance under title XXI if a 
child is determined ineligible for such assistance on the 
basis of information furnished pursuant to this paragraph. 
‘‘(C) If a State applies the eligibility process de-
scribed in subparagraph (A) to individuals eligible under 
this title and to individuals eligible under title XXI, the 
State may, at its option, implement its duties under sub-
paragraphs (A) and (B) of section 2102(b)(3) using either 
or both of the following approaches: 
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‘‘(i) The State may— 
‘‘(I) establish a threshold percentage of the 
Federal poverty level (that shall exceed the in-
come eligibility level applicable for a population 
of individuals under this title by 30 percentage 
points (as a fraction of the Federal poverty 
level) or such other higher number of percent-
age points as the State determines reflects the 
typical application of income methodologies by 
the non-health program and the State plan 
under this title); and 
‘‘(II) provide that, with respect to any in-
dividual within such population whom a non- 
health agency determines has income that does 
not exceed such threshold percentage for such 
population, such individual is eligible for med-
ical assistance under this title (regardless of 
whether such individual would otherwise be de-
termined to be eligible to receive such assist-
ance). 
In exercising the approach under this clause, a State 
shall inform families whose children are enrolled in 
a State child health plan under title XXI based on 
having family income above the threshold described 
in subclause (I) that they may qualify for medical 
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assistance under this title and, at their option, can 
seek a regular eligibility determination for such as-
sistance for their child. 
‘‘(ii) Regardless of whether a State otherwise 
provides for presumptive eligibility under section 
1920A, a State may provide presumptive eligibility 
under this title, consistent with subsection (e) of sec-
tion 1920A, to a child who, based on a determina-
tion by a non-health agency, would qualify for child 
health assistance under a State child health plan 
under title XXI. During such presumptive eligibility 
period, the State may determine the child’s eligibility 
for medical assistance under this title, pursuant to 
subparagraph (A) of section 2102(b)(3), based on 
telephone contact with family members, access to 
data available in electronic or paper form, and other 
means of gathering information that are less bur-
densome to the family than completing an applica-
tion form on behalf of the child. The procedures de-
scribed in the previous sentence may be used regard-
less of whether the State uses similar procedures 
under other circumstances for purposes of deter-
mining eligibility for medical assistance under this 
title. 
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‘‘(D) At the option of a State, the eligibility process 
described in subparagraph (A) may apply to an individual 
who is not a child. 
‘‘(E)(i) At the option of a State, an individual deter-
mined to be eligible for medical assistance or child health 
assistance pursuant to subparagraph (A), (C), or (D) or 
other procedures through which eligibility is determined 
based on data obtained from sources other than the indi-
vidual may receive medical assistance under this title if 
such individual (or, in the case of an individual under age 
19 (or if the State elects the option under subparagraph 
(A), age 20 or 21) who is not authorized to consent to 
medical care, the individual’s parent, guardian, or other 
caretaker relative) has acknowledged notice of such deter-
mination and has consented to such eligibility determina-
tion. The State (at its option) may waive any otherwise 
applicable requirements for signatures by or on behalf of 
an individual who has so consented. 
‘‘(ii) In the case of an individual enrolled pursuant 
to clause (i), the State shall inform the individual (or, in 
the case of an individual under age 19 (or if the State 
elects the option under subparagraph (A), age 20 or 21), 
the individual’s parent, guardian, or other caretaker rel-
ative) about the significance of such enrollment, including 
appropriate methods to access covered services. 
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‘‘(F) For purposes of this paragraph— 
‘‘(i) the term ‘non-health agency’ means an 
agency or entity described in subparagraph (A); and 
‘‘(ii) the term ‘non-health benefits’ means the 
benefits or assistance provided by a non-health agen-
cy.’’. 
(b) SCHIP.—Section 2107(e)(1) of such Act (42 
U.S.C. 1397gg(e)(1)) is amended by redesignating sub-
paragraphs (B) through (E) as subparagraphs (C) 
through (F) and by inserting after subparagraph (B) the 
following new subparagraph: 
‘‘(C) Section 1902(e)(13) (relating to the 
State option to base a determination of a child’s 
eligibility for assistance on determinations made 
by a program providing nutrition or other pub-
lic assistance (except that the State option 
under subparagraph (D) of such section shall 
apply under this title only if an individual is 
pregnant)).’’. 
(c) PRESUMPTIVE ELIGIBILITY.—Section 1920A of 
such Act (42 U.S.C. 1396r–1a) is amended— 
(1) in subsection (b)(3)(A)(i), is amended by 
striking ‘‘or (IV)’’ and inserting ‘‘(IV) is an agency 
or entity described in section 1902(e)(13)(A), or 
(V)’’; and 
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(2) by adding at the end the following: 
‘‘(e) In the case of a State with a child health plan 
under title XXI that provides for presumptive eligibility 
under such plan for children, the State shall make a rea-
sonable effort to place each presumptively eligible child in 
the program under this title or title XXI for which the 
child appears most likely to qualify. During the child’s pe-
riod of presumptive eligibility, the State shall receive Fed-
eral matching funds under section 1903 or section 2105, 
depending on the program in which the child has been 
placed. If at the conclusion of such period, the child is 
found to qualify for, and is enrolled in, the program estab-
lished under this title or title XXI when the child was en-
rolled in the program under the other such title during 
such period, the State’s receipt of Federal matching funds 
shall be adjusted both retroactively and prospectively so 
that Federal matching funds are provided, both during 
and following such period of presumptive eligibility, based 
on the program in which the child is enrolled.’’. 
(d) SIGNATURE REQUIREMENTS.—Section 1902(a) 
of such Act (42 U.S.C. 1396a(a)) is amended by adding 
at the end the following: ‘‘Notwithstanding any other pro-
vision of law, a signature under penalty of perjury shall 
not be required on an application form for medical assist-
ance as to any element of eligibility for which eligibility 
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is based on information received from a source other than 
applicant, rather than on representations from the appli-
cant. Notwithstanding any other provision of law, any sig-
nature requirement for an application for medical assist-
ance 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).’’. 
SEC. 203. INFORMATION TECHNOLOGY CONNECTIONS TO 
IMPROVE HEALTH COVERAGE DETERMINA-
TIONS. 
(a) ENHANCED FEDERAL FUNDING FOR IMPROVE-
MENTS RELATED
TO IMPLEMENTATION
OF CERTAIN 
MODEL OUTREACH AND ENROLLMENT PRACTICES.— 
(1) IN GENERAL.—Section 1903(a)(3)(A) of the 
Social Security Act (42 U.S.C. 1396b(a)(3)(A)) is 
amended— 
(A) by striking ‘‘and’’ at the end of clause 
(i); and 
(B) by adding at the end the following new 
clause: 
‘‘(iii) 75 percent of so much of the sums 
expended during such quarter as are attrib-
utable to the design, development, or installa-
tion of such mechanized claims processing and 
information retrieval systems and the imple-
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mentation of administrative systems and proc-
esses (including modification of eligibility com-
puter systems to permit the exchange of elec-
tronic information with other Federal or State 
programs) as the Secretary determines are di-
rectly related to the implementation of a model 
outreach and enrollment practice described in 
subparagraph (B), (C), (D), (E), or (F) of sec-
tion 1905(y)(3), and’’. 
(2) CONFORMING
AMENDMENT
TO
ENSURE 
AVAILABILITY FOR TERRITORIES.—Section 1108(g) 
of such Act (42 U.S.C. 1308(g)), as amended by 
section 201(b)(2)(B), is amended— 
(A) in paragraph (2), by striking ‘‘and 
(4)’’ and inserting ‘‘, (4), and (5)’’; and 
(B) by adding at the end the following new 
paragraph: 
‘‘(5) ADDITIONAL INCREASE FOR CERTAIN EX-
PENDITURES.—With respect to fiscal year 2008 and 
each fiscal year thereafter, if Puerto Rico, the Virgin 
Islands, Guam, the Northern Mariana Islands, or 
American Samoa qualify for a payment under sec-
tion 1903(a)(3)(A)(iii) for a calendar quarter of 
such fiscal year, the additional Federal financial par-
ticipation under such section shall not be counted to-
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wards the limitation on expenditures under title XIX 
for such commonwealth or territory otherwise deter-
mined under subsection (f) and this subsection for 
such fiscal year.’’. 
(b) AUTHORIZATION
OF
INFORMATION
DISCLO-
SURE.— 
(1) IN GENERAL.—Title XIX of such Act (42 
U.S.C. 1396 et seq.) is amended— 
(A) by redesignating section 1939 as sec-
tion 1940; and 
(B) by inserting after section 1938 the fol-
lowing: 
‘‘AUTHORIZATION TO RECEIVE PERTINENT INFORMATION 
‘‘SEC. 1939. (a) IN GENERAL.—Notwithstanding any 
other provision of law, a Federal or State agency or pri-
vate entity in possession of the sources of data potentially 
pertinent to eligibility determinations under this title or 
title XXI (including eligibility files maintained by pro-
grams described in section 1902(e)(13)(A), information 
described in paragraph (2) or (3) of section 1137(a), vital 
records information about births in any State, and infor-
mation described in sections 453(i) and 1902(a)(25)(I)) 
is authorized to convey such data or information to a State 
agency administering a State plan under this title or title 
XXI, if— 
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‘‘(1) such data or information are used only to 
establish or verify eligibility or provide coverage 
under this title or title XXI; and 
‘‘(2) an interagency or other agreement, con-
sistent with standards developed by the Secretary, 
prevents the unauthorized use, disclosure, or modi-
fication of such data and otherwise meets applicable 
Federal requirements safeguarding privacy and data 
security. 
‘‘(b) REQUIREMENTS FOR CONVEYANCE.—Data or 
information may be conveyed pursuant to this section only 
if the following requirements are met: 
‘‘(1) The individual whose circumstances are 
described in the data or information (or such indi-
vidual’s parent, guardian, caretaker relative, or au-
thorized representative) has either provided advance 
consent to disclosure or has not objected to disclo-
sure after receiving advance notice of disclosure and 
a reasonable 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 assistance under 
this title or title XXI and enrolling such indi-
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viduals in the State plans established under 
such titles; and 
‘‘(B) verifying the eligibility of individuals 
for assistance under the State plans established 
under this title or title XXI. 
‘‘(3) An interagency or other agreement, con-
sistent with standards developed by the Secretary— 
‘‘(A) prevents the unauthorized use, disclo-
sure, or modification of such data and other-
wise meets applicable Federal requirements 
safeguarding privacy and data security; and 
‘‘(B) requires the State agencies admin-
istering the State plans established under this 
title and title XXI to use the data and informa-
tion obtained under this section to seek to en-
roll individuals in such plans. 
‘‘(c) CRIMINAL PENALTY.—A person described in the 
subsection (a) who publishes, divulges, discloses, or makes 
known in any manner, or to any extent not authorized by 
Federal law, any information obtained under this section 
shall be fined not more than $1,000 or imprisoned not 
more than 1 year, or both for each such unauthorized ac-
tivity. 
‘‘(d) RULE OF CONSTRUCTION.—The limitations and 
requirements that apply to disclosure pursuant to this sec-
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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 ASSURE AC-
CESS TO NATIONAL NEW HIRES DATABASE.—Section 
453(i)(1) of such Act (42 U.S.C. 653(i)(1)) is 
amended by striking ‘‘and programs funded under 
part A’’ and inserting ‘‘, programs funded under 
part A, and State plans approved under title XIX or 
XXI’’. 
(3) CONFORMING
AMENDMENT
TO
PROVIDE 
SCHIP PROGRAMS WITH ACCESS TO NATIONAL IN-
COME DATA.—Section 6103(l)(7)(D)(ii) of the Inter-
nal Revenue Code of 1986 is amended by inserting 
‘‘or title XXI’’ after ‘‘title XIX’’. 
(4) CONFORMING AMENDMENT TO PROVIDE AC-
CESS TO DATA ABOUT ENROLLMENT IN INSURANCE 
FOR PURPOSES OF EVALUATING APPLICATIONS AND 
FOR SCHIP.—Section 1902(a)(25)(I)(i) of the Social 
Security Act (42 U.S.C. 1396a(a)(25)(I)(i)) is 
amended— 
(A) by inserting ‘‘(and, at State option, in-
dividuals who are potentially eligible or who 
apply)’’ after ‘‘with respect to individuals who 
are eligible’’; and 
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(B) by inserting ‘‘under this title (and, at 
State option, child health assistance under title 
XXI)’’ after ‘‘the State plan’’. 
SEC. 204. STATE OPTION TO EXPAND OR ADD COVERAGE 
OF 
CERTAIN 
PREGNANT 
WOMEN 
UNDER 
SCHIP. 
(a) SCHIP.— 
(1) COVERAGE.—Title XXI of the Social Secu-
rity Act (42 U.S.C. 1397aa et seq.) is amended by 
adding at the end the following new section: 
‘‘SEC. 2111. OPTIONAL COVERAGE OF TARGETED LOW-IN-
COME PREGNANT WOMEN. 
‘‘(a) OPTIONAL COVERAGE.—Notwithstanding any 
other provision of this title, a State may provide for cov-
erage, through an amendment to its State child health 
plan under section 2102, of pregnancy-related assistance 
for targeted low-income pregnant women in accordance 
with this section, but only if— 
‘‘(1) the State has established an income eligi-
bility level— 
‘‘(A) for pregnant women under subsection 
(a)(10)(A)(i)(III) or (l)(2)(A) of section 1902 
that is at least 185 percent of the poverty line; 
and 
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‘‘(B) for children under this title that is at 
least 200 percent of the poverty line; and 
‘‘(2) the State meets the requirement of section 
2105(i)(2) (relating to no waiting list for children). 
‘‘(b) DEFINITIONS.—For purposes of this title: 
‘‘(1) PREGNANCY-RELATED ASSISTANCE.—The 
term ‘pregnancy-related assistance’ has the meaning 
given the term child health assistance in section 
2110(a) as if any reference to targeted low-income 
children were a reference to targeted low-income 
pregnant women. 
‘‘(2) 
TARGETED
LOW-INCOME
PREGNANT 
WOMAN.—The term ‘targeted low-income pregnant 
woman’ means a woman— 
‘‘(A) during pregnancy and through the 
end of the month in which the 60-day period 
(beginning on the last day of her pregnancy) 
ends; 
‘‘(B) whose family income exceeds 185 per-
cent of the poverty level applicable to a family 
of the size involved, but does not exceed the in-
come eligibility level established under the State 
child health plan under this title for a targeted 
low-income child; and 
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‘‘(C) who satisfies the requirements of 
paragraphs (1)(A), (1)(C), (2), and (3) of sec-
tion 2110(b). 
‘‘(c) 
REFERENCES
TO
TERMS
AND
SPECIAL 
RULES.—In the case of, and with respect to, a State pro-
viding for coverage of pregnancy-related assistance to tar-
geted low-income pregnant women under subsection (a), 
the following special rules apply: 
‘‘(1) Any reference in this title (other than in 
subsection (b)) to a targeted low-income child is 
deemed to include a reference to a targeted low-in-
come pregnant woman. 
‘‘(2) Any such reference to child health assist-
ance with respect to such women is deemed a ref-
erence to pregnancy-related assistance. 
‘‘(3) Any such reference to a child is deemed a 
reference to a woman during pregnancy and the pe-
riod described in subsection (b)(2)(A). 
‘‘(4) In applying section 2102(b)(3)(B), any 
reference to children found through screening to be 
eligible for medical assistance under the State med-
icaid plan under title XIX is deemed a reference to 
pregnant women. 
‘‘(5) There shall be no exclusion of benefits for 
services described in subsection (b)(1) based on any 
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preexisting condition and no waiting period (includ-
ing any waiting period imposed to carry out section 
2102(b)(3)(C)) shall apply. 
‘‘(6) In applying section 2103(e)(3)(B) in the 
case of a pregnant woman provided coverage under 
this section, the limitation on total annual aggregate 
cost-sharing shall be applied to such pregnant 
woman. 
‘‘(7) In applying section 2104(i)— 
‘‘(A) in the case of State which did not 
provide for coverage for pregnant women under 
this title (under a waiver or otherwise) during 
fiscal year 2007, the allotment amount other-
wise computed for the first fiscal year in which 
the State elects to provide coverage under this 
section shall be increased by an amount (deter-
mined by the Secretary) equal to the enhanced 
FMAP of the expenditures under this title for 
such coverage, based upon projected enrollment 
and per capita costs of such enrollment; and 
‘‘(B) in the case of a State which provided 
for coverage of pregnant women under this title 
for the previous fiscal year— 
‘‘(i) in applying paragraph (1)(B)(ii) 
of such section, there shall also be taken 
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into account (in an appropriate proportion) 
the percentage increase in births in the 
United States for the relevant period; and 
‘‘(ii) in applying paragraph (1)(C), 
pregnant women (and per capita expendi-
tures for such women) shall be accounted 
for separately from children, but shall be 
included in the total amount of any allot-
ment adjustment under such paragraph. 
‘‘(d) AUTOMATIC
ENROLLMENT
FOR
CHILDREN 
BORN TO WOMEN RECEIVING PREGNANCY-RELATED AS-
SISTANCE.—If a child is born to a targeted low-income 
pregnant woman who was receiving pregnancy-related as-
sistance under this section on the date of the child’s birth, 
the child shall be deemed to have applied for child health 
assistance under the State child health plan and to have 
been found eligible for such assistance under such plan 
or to have applied for medical assistance under title XIX 
and to have been found eligible for such assistance under 
such title, as appropriate, on the date of such birth and 
to remain eligible for such assistance until the child at-
tains 1 year of age. During the period in which a child 
is deemed under the preceding sentence to be eligible for 
child health or medical assistance, the child health or med-
ical assistance eligibility identification number of the 
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mother shall also serve as the identification number of the 
child, and all claims shall be submitted and paid under 
such number (unless the State issues a separate identifica-
tion number for the child before such period expires).’’. 
(2) NO
COST-SHARING
FOR
PREGNANCY-RE-
LATED BENEFITS.—Section 2103(e)(2) of such Act 
(42 U.S.C. 1397cc(e)(2)) is amended— 
(A) in the heading, by inserting ‘‘OR PREG-
NANCY-RELATED
SERVICES’’ after ‘‘PREVEN-
TIVE SERVICES’’; and 
(B) by inserting before the period at the 
end the following: ‘‘or for pregnancy-related 
services’’. 
(3) 
ADDITIONAL
AMENDMENT.—Section 
2107(e)(1)(F) 
of 
such 
Act 
(42 
U.S.C. 
1397gg(e)(1)(G)), as redesignated by section 202(b), 
is amended to read as follows: 
‘‘(F) Sections 1920 and 1920A (relating to 
presumptive eligibility for pregnant women and 
children).’’. 
(b) AMENDMENTS TO MEDICAID.— 
(1) ELIGIBILITY
OF
A
NEWBORN.—Section 
1902(e)(4) of such Act (42 U.S.C. 1396a(e)(4)) is 
amended in the first sentence by striking ‘‘so long 
as the child is a member of the woman’s household 
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and the woman remains (or would remain if preg-
nant) eligible for such assistance’’. 
(2) APPLICATION OF QUALIFIED ENTITIES TO 
PRESUMPTIVE ELIGIBILITY FOR PREGNANT WOMEN 
UNDER MEDICAID.—Section 1920(b) of such Act (42 
U.S.C. 1396r–1(b)) is amended by adding after 
paragraph (2) the following flush sentence: 
‘‘The term ‘qualified provider’ includes a qualified entity, 
as defined in section 1920A(b)(3).’’. 
SEC. 205. OPTIONAL COVERAGE OF LEGAL IMMIGRANTS 
UNDER THE MEDICAID PROGRAM AND SCHIP. 
(a) MEDICAID PROGRAM.—Section 1903(v) of the 
Social Security Act (42 U.S.C. 1396b(v)) is amended— 
(1) in paragraph (1), by striking ‘‘paragraph 
(2)’’ and inserting ‘‘paragraphs (2) and (4)’’; and 
(2) by adding at the end the following new 
paragraph: 
‘‘(4)(A) A State may elect (in a plan amendment 
under this title) to provide medical assistance under this 
title, notwithstanding sections 401(a), 402(b), 403, and 
421 of the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996, for aliens who are lawfully re-
siding in the United States (including battered aliens de-
scribed in section 431(c) of such Act) and who are other-
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wise eligible for such assistance, within either or both of 
the following eligibility categories: 
‘‘(i) PREGNANT WOMEN.—Women during preg-
nancy (and during the 60-day period beginning on 
the last day of the pregnancy). 
‘‘(ii) CHILDREN.—Individuals under 21 years of 
age, including optional targeted low-income children 
described in section 1905(u)(2)(B). 
‘‘(B) In the case of a State that has elected to provide 
medical assistance to a category of aliens under subpara-
graph (A), no debt shall accrue under an affidavit of sup-
port against any sponsor of such an alien on the basis 
of provision of assistance to such category and the cost 
of such assistance shall not be considered as an unreim-
bursed cost.’’. 
(b) SCHIP.—Section 2107(e)(1) of such Act (42 
U.S.C. 1397gg(e)(1)), as amended by sections 202(b) and 
204(a)(3), is amended by redesignating subparagraphs 
(D) through (F) as subparagraph (E) through (G), respec-
tively, and by inserting after subparagraph (C) the fol-
lowing new subparagraph: 
‘‘(D) Section 1903(v)(4) (relating to op-
tional coverage of categories of lawfully residing 
immigrant children), but only if the State has 
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elected to apply such section to the category of 
children under title XIX.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section take effect on October 1, 2007, and apply to 
medical assistance and child health assistance furnished 
on or after such date. 
(d) CONSTRUCTION.—Nothing in this section shall be 
construed as affecting eligibility of aliens who are not law-
fully residing in the United States to benefits under the 
Medicaid program under title XIX of the Social Security 
Act or under the State children’s health insurance pro-
gram (SCHIP) under title XXI of such Act. 
SEC. 206. AUTHORIZING ADJUSTMENT OF SCHIP ALLOT-
MENT DUE TO INCREASED OUTREACH. 
(a) IN GENERAL.—Section 2104 of the Social Secu-
rity Act (42 U.S.C. 1397dd), as amended by section 101, 
is further amended by adding at the end the following new 
subsection: 
‘‘(j) AUTHORIZING ALLOTMENT ADJUSTMENT DUE 
TO INCREASED OUTREACH.— 
‘‘(1) IN GENERAL.—Notwithstanding the pre-
vious provisions of this section, if the Secretary de-
termines that— 
‘‘(A) a State has an increase in the aver-
age number of children enrolled under its State 
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child health plan in a fiscal year that exceeds 
the enrollment of children projected under para-
graph (2) for the State for such fiscal year, and 
‘‘(B) the total Federal expenditures under 
the State child health plan (or waiver) under 
this title exceeds the amount of the allotment 
made available to the State for the fiscal year, 
the Secretary shall increase the allotment under this 
section for the State for the fiscal year by the 
amount specified in paragraph (3). There are hereby 
appropriated, out of any money in the Treasury not 
otherwise appropriated, such sums as may be nec-
essary to provide for such increase in allotment. 
‘‘(2) PROJECTED
ENROLLMENT
OF
CHIL-
DREN.—The projected enrollment of children for a 
State under this paragraph for a fiscal year is equal 
to the average number of children enrolled under the 
State child health plan in fiscal year 2007 increased, 
for each subsequent fiscal year through the fiscal 
year involved, by a factor equal to the population 
growth of children in the State for such fiscal year, 
as projected by the Secretary before the beginning of 
the fiscal year involved. 
‘‘(3) AMOUNT OF ALLOTMENT INCREASE.— 
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‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), the amount of the allotment increase 
under this subsection for a State for a fiscal 
year shall be an amount equal to the product 
of— 
‘‘(i) the number by which the average 
number of children enrolled under the 
State child health plan in the fiscal year 
exceeds the enrollment of children pro-
jected under paragraph (2) for such State 
for such fiscal year; and 
‘‘(ii) the per capita expenditures for 
children under the State child health plan 
for the previous year, increased by the av-
erage annual rate of increase (for the three 
previous fiscal years) in the amount of 
such per capita expenditures. 
The amount of the allotment increase under 
this subsection shall not be subject to adminis-
trative or judicial review. 
‘‘(B) LIMITATION.— 
‘‘(i) IN GENERAL.—Subject to clause 
(ii), in no case shall the sum of the allot-
ment increases for all States under this 
subsection for a fiscal year exceed an 
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amount equal to 20 percent of the total 
Federal payments to all of the States oth-
erwise made under this title for the fiscal 
year. If such sum exceeds such amount, 
subject to clause (ii), the allotment in-
crease for each State under this subsection 
for the fiscal year shall be reduced in a pro 
rata manner in order that such sum does 
not exceed such amount. 
‘‘(ii) CONGRESSIONAL
APPROVAL
OF 
ADDITIONAL AMOUNTS.—If the Secretary 
estimates that the allotment increases that 
should be provided under this subsection, 
but for clause (i), would exceed the limita-
tion established under such clause, the 
Secretary shall submit to Congress a re-
quest for supplemental appropriations for 
the purpose of meeting such shortfall. 
‘‘(4) CLARIFICATION.—An adjustment in an al-
lotment shall not be made under this subsection due 
to excess State expenditures resulting from a growth 
in per capita costs, increased reimbursement to pro-
viders, or other factors not directly related to out-
reach to eligible, but previously unenrolled chil-
dren.’’. 
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(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall take effect beginning with allotments 
for fiscal year 2008. 
SEC. 207. GRANTS TO PROMOTE INNOVATIVE OUTREACH 
AND ENROLLMENT UNDER MEDICAID AND 
SCHIP. 
Title XXI of the Social Security Act (42 U.S.C. 
1397aa et seq.), as amended by section 204(a), is amend-
ed by adding at the end the following: 
‘‘SEC. 2112. EXPANDED OUTREACH ACTIVITIES THROUGH 
GRANTS 
TO 
CONDUCT 
INNOVATIVE 
OUT-
REACH AND ENROLLMENT EFFORTS. 
‘‘(a) IN
GENERAL.—The Secretary shall award 
grants to eligible entities to— 
‘‘(1) conduct innovative outreach and enroll-
ment efforts that are designed to increase the enroll-
ment and participation of eligible children under this 
title and title XIX; and 
‘‘(2) promote understanding of the importance 
of health insurance coverage for prenatal care and 
children. ‘ 
‘‘(b) PRIORITY FOR AWARD OF GRANTS.— 
‘‘(1) IN
GENERAL.—In making grants under 
subsection (a), the Secretary shall give priority to— 
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‘‘(A) eligible entities that propose to target 
geographic areas with high rates of— 
‘‘(i) eligible but unenrolled children, 
including such children who reside in rural 
areas; or 
‘‘(ii) racial and ethnic minorities and 
health disparity populations, including 
those proposals that address cultural and 
linguistic barriers to enrollment; and 
‘‘(B) eligible entities that plan to engage in 
outreach efforts with respect to individuals de-
scribed in subparagraph (A) and that are— 
‘‘(i) Federal health safety net organi-
zations; or 
‘‘(ii) faith-based organizations or con-
sortia. 
‘‘(c) APPLICATION.—An eligible entity that desires to 
receive a grant under subsection (a) shall submit an appli-
cation to the Secretary in such form and manner, and con-
taining such information, as the Secretary may decide. 
Such application shall include— 
‘‘(1) quality and outcomes performance meas-
ures to evaluate the effectiveness of activities funded 
by a grant awarded under this section to ensure that 
the activities are meeting their goals; and 
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‘‘(2) an assurance that the entity shall— 
‘‘(A) conduct an assessment of the effec-
tiveness of such activities against such perform-
ance measures; 
‘‘(B) cooperate with the collection and re-
porting of enrollment data and other informa-
tion determined as a result of conducting such 
assessments to the Secretary, in such form and 
manner as the Secretary shall require; and 
‘‘(C) conduct work under the grant in con-
junction with the States involved. 
‘‘(d) DISSEMINATION OF ENROLLMENT DATA AND 
INFORMATION DETERMINED FROM EFFECTIVENESS AS-
SESSMENTS; ANNUAL REPORT.—The Secretary shall— 
‘‘(1) disseminate to eligible entities and make 
publicly available the enrollment data and informa-
tion collected and reported in accordance with sub-
section (c)(2)(B); and 
‘‘(2) submit an annual report to Congress on 
the outreach activities funded by grants awarded 
under this section. 
‘‘(e) SUPPLEMENT, NOT SUPPLANT.—Federal funds 
awarded under this section shall be used to supplement, 
not supplant, non-Federal funds that are otherwise avail-
able for activities funded under this section. 
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‘‘(f) DEFINITIONS.—In this section: 
‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible en-
tity’ means any of the following: 
‘‘(A) A local government. 
‘‘(B) A Federal health safety net organiza-
tion. 
‘‘(C) A national, local, or community-based 
public or nonprofit private organization, includ-
ing community health workers. 
‘‘(D) A faith-based organization or con-
sortia, to the extent that a grant awarded to 
such an entity is consistent with the require-
ments of section 1955 of the Public Health 
Service Act (42 U.S.C. 300x–65) relating to a 
grant award to non-governmental entities. 
‘‘(E) An elementary or secondary school. 
‘‘(2) FEDERAL HEALTH SAFETY NET ORGANI-
ZATION.—The term ‘Federal health safety net orga-
nization’ means— 
‘‘(A) an Indian tribe, tribal organization, 
or an urban Indian organization receiving funds 
under title V of the Indian Health Care Im-
provement Act (25 U.S.C. 1651 et seq.), or an 
Indian Health Service provider; 
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‘‘(B) a Federally-qualified health center 
(as defined in section 1905(l)(2)(B)); 
‘‘(C) a hospital defined as a dispropor-
tionate share hospital for purposes of section 
1923; 
‘‘(D) a covered entity described in section 
340B(a)(4) of the Public Health Service Act 
(42 U.S.C. 256b(a)(4)); and 
‘‘(E) any other entity or a consortium that 
serves children under a federally-funded pro-
gram, including the special supplemental nutri-
tion program for women, infants, and children 
(WIC) established under section 17 of the Child 
Nutrition Act of 1966 (42 U.S.C. 1786), the 
head start and early head start programs under 
the Head Start Act (42 U.S.C. 9801 et seq.), 
the school lunch program established under the 
Richard B. Russell National School Lunch Act, 
and an elementary or secondary school. 
‘‘(3) INDIANS; INDIAN TRIBE; TRIBAL ORGANI-
ZATION; URBAN INDIAN ORGANIZATION.—The terms 
‘Indian’, ‘Indian tribe’, ‘tribal organization’, and 
‘urban Indian organization’ have the meanings given 
such terms in section 4 of the Indian Health Care 
Improvement Act (25 U.S.C. 1603). 
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‘‘(g) APPROPRIATION.—There is appropriated, out of 
any money in the Treasury not otherwise appropriated, 
$50,000,000 for each of fiscal years 2008 through 2012 
for the purpose of awarding grants under this section. 
Amounts appropriated and paid under the authority of 
this section shall be in addition to amounts appropriated 
under section 2104 and paid to States in accordance with 
section 2105, including with respect to expenditures for 
outreach 
activities 
in 
accordance 
with 
subsection 
(a)(1)(D)(iii) of such section.’’. 
SEC. 208. MODEL OF INTERSTATE COORDINATED ENROLL-
MENT AND COVERAGE PROCESS. 
In order to assure continuity of coverage of low-in-
come children under the Medicaid program and the State 
Children’s Health Insurance Program (SCHIP), the Sec-
retary of Health and Human Services, in consultation with 
State Medicaid and SCHIP directors, shall develop and 
disseminate a model process for the coordination of the 
enrollment and coverage under such programs of children 
who, because of migration of families, emergency evacu-
ations, educational needs, or otherwise, frequently change 
their State of residency or otherwise are temporarily 
present outside of the State of their residency. 
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SEC. 209. AUTHORITY FOR QUALIFYING STATES TO USE 
PORTION OF SCHIP ALLOTMENT FOR ANY 
FISCAL YEAR FOR CERTAIN MEDICAID EX-
PENDITURES. 
Section 2105(g)(1)(A) of the Social Security Act (42 
U.S.C. 1397ee(g)(1)(A)), as amended by section 201(b) 
of the National Institutes of Health Reform Act of 2006 
(Public Law 109–482) is amended by striking ‘‘fiscal year 
1998, 1999, 2000, 2001, 2004, 2005, 2006, or 2007’’ and 
inserting ‘‘a fiscal year’’. 
SEC. 210. APPLICATION OF MEDICAID OUTREACH PROCE-
DURES TO ALL PREGNANT WOMEN AND CHIL-
DREN. 
(a) IN GENERAL.—Section 1902(a)(55) of the Social 
Security Act (42 U.S.C. 1396a(a)(55)) is amended by 
striking ‘‘individuals for medical assistance under sub-
section 
(a)(10)(A)(i)(IV), 
(a)(10)(A)(i)(VI), 
(a)(10)(A)(i)(VII), or (a)(10)(A)(ii)(IX)’’ and inserting 
‘‘child and pregnant women for medical assistance (includ-
ing under clauses (i)(IV), (i)(VI), (i)(VII), and (ii)(IX) of 
paragraph (10)(A))’’. 
(b) EFFECTIVE DATE.— 
(1) IN GENERAL.— 
(2) EXCEPTION FOR STATE LEGISLATION.—In 
the case of a State plan under title XIX of the So-
cial Security Act, which the Secretary of Health and 
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Human Services determines requires State legisla-
tion in order for the plan to meet the additional re-
quirements imposed by the amendment made by 
subsection (a), the State plan shall not be regarded 
as failing to comply with the requirements of such 
Act solely on the basis of its failure to meet these 
additional requirements before the first day of the 
first calendar quarter beginning after the close of 
the first regular session of the State legislature that 
begins after the date of enactment of this Act. For 
purposes of the previous sentence, in the case of a 
State that has a 2-year legislative session, each year 
of the session shall be considered to be a separate 
regular session of the State legislature. 
SEC. 211. NO IMPACT ON SECTION 1115 WAIVERS. 
Nothing in this Act shall be construed to affect waiv-
ers regarding State flexibility on eligibility previously ap-
proved by the Secretary of Health and Human Services 
under section 1115 of the Social Security Act (42 U.S.C. 
1315). 
SEC. 212. ELIMINATION OF COUNTING MEDICAID CHILD 
PRESUMPTIVE ELIGIBILITY COSTS AGAINST 
TITLE XXI ALLOTMENT. 
Section 2105(a)(1) of the Social Security Act (42 
U.S.C. 1397ee(a)(1)) is amended— 
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(1) in the matter preceding subparagraph (A), 
by striking ‘‘(or, in the case of expenditures de-
scribed in subparagraph (B), the Federal medical 
assistance percentage (as defined in the first sen-
tence of section 1905(b)))’’; and 
(2) by amending subparagraph (B) to read as 
follows: 
‘‘(B) [reserved]’’. 
SEC. 213. PROHIBITING LIMITATIONS ON ENROLLMENT. 
(a) IN GENERAL.—Section 2102(b)(3)(B) of the So-
cial Security Act (42 U.S.C. 1397bb(b)(3)(B)) is amend-
ed— 
(1) by striking ‘‘and’’ at the end of clause (i); 
(2) by striking the period at the end of clause 
(ii) and inserting ‘‘; and’’; and 
(3) by adding at the end the following new 
clause: 
‘‘(iii) shall not impose, with respect to 
enrollment of targeted low-income children 
under the State child health plan, any en-
rollment cap or other numerical limitation 
on enrollment, any waiting list, any proce-
dures designed to delay the consideration 
of applications for enrollment, or similar 
limitation with respect to enrollment.’’. 
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(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to State child health plans as 
of October 1, 2007. 
TITLE III—HEALTHY SAVINGS 
TAX CREDIT 
SEC. 301. HEALTHY SAVINGS TAX CREDIT. 
(a) IN GENERAL.—Subpart C of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to refundable personal credits) is amended 
by redesignating section 36 as section 37 and by inserting 
after section 35 the following new section: 
‘‘SEC. 36. HEALTH INSURANCE FOR QUALIFYING CHIL-
DREN. 
‘‘(a) IN GENERAL.—In the case of an individual, 
there shall be allowed as a credit against the tax imposed 
by subtitle A an amount equal to the applicable percentage 
of the amount paid by the taxpayer for coverage of quali-
fying children of the taxpayer under qualified health insur-
ance for eligible coverage months beginning in the taxable 
year. 
‘‘(b) ELIGIBLE COVERAGE MONTH.—For purposes of 
this section, the term ‘eligible coverage month’ means, 
with respect to any qualifying child of the taxpayer, any 
month with respect to which the designated State agency 
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has certified that, as of the first day of such month, such 
child— 
‘‘(1) is covered by qualified health insurance, 
‘‘(2) does not have access to other specified cov-
erage for such month (as determined under sub-
section (f)), and 
‘‘(3) is not imprisoned under Federal, State, or 
local authority. 
‘‘(c) APPLICABLE PERCENTAGE.— 
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, the term ‘applicable percentage’ means the per-
centage determined in accordance with the following 
table: 
In the case of a taxpayer whose adjusted gross in-
come for the taxable year is: 
The applicable percentage 
is: 
200 percent of the poverty line or less .....................
0 percent
More than 200 percent, but not more than 225 per-
cent, of the poverty line.
75 percent
More than 225 percent, but not more than 250 per-
cent, of the poverty line.
65 percent
More than 250 percent, but not more than 300 per-
cent, of the poverty line.
55 percent
More than 300 percent, but not more than 350 per-
cent, of the poverty line.
50 percent
More than 350 percent of the poverty line ...............
0 percent. 
‘‘(2) POVERTY LINE.—For purposes of para-
graph (1), the term ‘poverty line’ means the income 
official poverty line (as defined by the Office of Man-
agement and Budget, and revised annually in ac-
cordance with section 673(2) of the Community 
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Services Block Grant Act (42 U.S.C. 9902(2)) appli-
cable to a family of the size involved. 
‘‘(d) QUALIFYING CHILD.—For purposes of this sec-
tion, the term ‘qualifying child’ means, with respect to any 
taxpayer, any qualifying child of the taxpayer (as defined 
in section 152(c)). 
‘‘(e) QUALIFIED HEALTH INSURANCE.—For pur-
poses of this section— 
‘‘(1) IN GENERAL.—The term ‘qualified health 
insurance’ means, with respect to any qualifying 
child of the taxpayer— 
‘‘(A) coverage under any insurance consti-
tuting medical care which is certified by the 
designated State agency as being— 
‘‘(i) provided under a group health 
plan (as defined in section 5000(b)(1)), 
and 
‘‘(ii) at least actuarially equivalent in 
benefits coverage to the plan described in 
paragraph (2), or 
‘‘(B) in the case of a qualifying child who 
is certified by the designated State agency as 
not eligible for coverage under any insurance 
described in subparagraph (A), coverage under 
any of the following plans if such coverage has 
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been certified by the designated State agency as 
being at least actuarially equivalent in benefits 
coverage to the plan described in paragraph (2): 
‘‘(i) COVERAGE
OFFERED
THROUGH 
HMO.—The health insurance coverage plan 
that— 
‘‘(I) is offered by a health main-
tenance organization (as defined in 
section 2791(b)(3) of the Public 
Health Service Act), and 
‘‘(II) has the largest insured 
commercial, nonmedicaid enrollment 
of covered lives of such coverage plans 
offered by such a health maintenance 
organization in the State. 
‘‘(ii) STATE EMPLOYEE COVERAGE.— 
The health insurance plan that is offered 
to State employees and has the largest en-
rollment of covered lives of any such plan. 
‘‘(iii) SCHIP COVERAGE.—Coverage 
provided under the State plan approved 
under the State children’s health insurance 
program under title XXI of Social Security 
Act (without regard to coverage provided 
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under a waiver of the requirements of such 
program). 
‘‘(iv) STATE CERTIFIED ACTUARIALLY 
EQUIVALENT
COVERAGE.—A State-based 
health insurance program. 
‘‘(2) 
FEHBP 
ACTUARIALLY
EQUIVALENT 
HEALTH BENEFITS COVERAGE.— 
‘‘(A) IN GENERAL.—The plan described in 
and offered under chapter 89 of title 5, United 
States Code with the highest number of enroll-
ees under such section for the year preceding 
the year in which the coverage described in 
paragraph (1) is provided. 
‘‘(B) 
APPLICATION
OF
BENCHMARK 
STANDARD.—Coverage is actuarially equivalent 
to benefits coverage under the plan described in 
subparagraph (A) if such coverage covers all 
items and services offered by the benchmark 
plan, with out-of-pocket cost-sharing for such 
items and services that is not greater than 
under the benchmark plan. 
‘‘(3) INSURANCE WHICH COVERS OTHER INDI-
VIDUALS.—In the case of any contract for qualified 
health insurance under which amounts are payable 
for coverage of any individual other than one or 
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more qualifying children, the amount treated as paid 
for coverage of qualifying children under such insur-
ance shall be the greater of— 
‘‘(A) the amount which would be so treated 
under rules similar to the rules of section 
213(d)(6), or 
‘‘(B) 30 percent of the amounts payable 
for coverage of all individuals covered under the 
contract under qualified health insurance. 
‘‘(4) ONLY ONE POLICY TAKEN INTO ACCOUNT 
PER CHILD.—With respect to any qualifying child 
for any period, coverage under not more than one 
contract for qualified health insurance may be taken 
into account under subsection (a). 
‘‘(5) EXCEPTION.—The term ‘qualified health 
insurance’ shall not include— 
‘‘(A) a flexible spending or similar ar-
rangement, and 
‘‘(B) any insurance if substantially all of 
its coverage is of excepted benefits described in 
section 9832(c). 
‘‘(6) OTHER REQUIREMENTS.—The term ‘quali-
fied health insurance’shall not include any insurance 
unless such insurance meets the following require-
ments: 
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‘‘(A) GROUP
HEALTH
PLAN
REQUIRE-
MENTS.—The health benefits coverage provided 
meets the requirements applicable to a group 
health plan under chapter 100 of this title, part 
7 of subtitle B of title I of the Employee Re-
tirement Income Security Act of 1974, and 
State law. 
‘‘(B) GUARANTEED
ISSUE
AND
RENEW-
ABLE.—The arrangement does not deny cov-
erage (including renewal of coverage) with re-
spect to any qualifying child on the basis of 
health status of such qualifying child or any 
other factor, condition or requirement. 
‘‘(C) NO PREEXISTING CONDITION EXCLU-
SION.—The arrangement does not permit a pre-
existing condition exclusion as defined under 
section 9801(b)(1). 
‘‘(D) NO
UNDERWRITING; 
COMMUNITY- 
RATED PREMIUMS.— 
‘‘(i) UNDERWRITING.—Subject to sub-
paragraph (B), the arrangement does not 
permit underwriting, through a preexisting 
condition limitation, differential benefits, 
or different premium levels, or otherwise, 
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