(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall take effect on July 1, 2006, 
whether or not regulations implementing such 
amendments have been issued. 
(c) PROVISION OF MEDICAID AND CHIP APPLICA-
TIONS AND INFORMATION UNDER THE SCHOOL LUNCH 
PROGRAM.—Section 9(b)(2)(B) of the Richard B. Russell 
National School Lunch Act (42 U.S.C. 1758(b)(2)(B)) is 
amended— 
(1) by striking ‘‘(B) Applications’’ and inserting 
‘‘(B)(i) Applications’’; and 
(2) by adding at the end the following: 
‘‘(ii)(I) Applications for free and reduced price 
lunches that are distributed pursuant to clause (i) to par-
ents or guardians of children in attendance at schools par-
ticipating in the school lunch program under this Act shall 
also contain information on the availability of medical as-
sistance under title XIX of the Social Security Act (42 
U.S.C. 1396 et seq.) and of child health and FamilyCare 
assistance under title XXI of such Act, including informa-
tion on how to obtain an application for assistance under 
such programs. 
‘‘(II) Information on the programs referred to in sub-
clause (I) shall be provided on a form separate from the
application form for free and reduced price lunches under 
clause (i).’’. 
SEC. 8. REVISION AND SIMPLIFICATION OF THE TRANSI-
TIONAL 
MEDICAL 
ASSISTANCE 
PROGRAM 
(TMA). 
(a) MAKING REPORTING REQUIREMENTS OPTIONAL; 
OPTION OF EXTENDED ELIGIBILITY.— 
(1) OPTION FOR MAKING REPORTING REQUIRE-
MENTS OPTIONAL.—Section 1925(b) of the Social 
Security Act (42 U.S.C. 1396r–6(b)) is amended— 
(A) in paragraph (1), by inserting ‘‘, at the 
option of a State,’’ after ‘‘and which’’; 
(B) in paragraph (2)(A), by inserting 
‘‘Subject to subparagraph (C)—’’ after ‘‘(A) 
NOTICES.—’’; 
(C) in paragraph (2)(B), by inserting 
‘‘Subject to subparagraph (C)—’’ after ‘‘(B) 
REPORTING REQUIREMENTS.—’’; 
(D) by adding at the end the following new 
subparagraph: 
‘‘(C) STATE
OPTION
TO
WAIVE
NOTICE 
AND
REPORTING
REQUIREMENTS.—A State 
may waive some or all of the reporting require-
ments under clauses (i) and (ii) of subpara-
graph (B). Insofar as it waives such a reporting
requirement, the State need not provide for a 
notice under subparagraph (A) relating to such 
requirement.’’; and 
(E) in paragraph (3)(A)(iii), by inserting 
‘‘the State has not waived under paragraph 
(2)(C) the reporting requirement with respect 
to such month under paragraph (2)(B) and if’’ 
after ‘‘6-month period if’’. 
(2) STATE
OPTION
TO
EXTEND
ELIGIBILITY 
FOR LOW-INCOME INDIVIDUALS FOR UP TO 12 ADDI-
TIONAL
MONTHS.—Section 1925 of such Act (42 
U.S.C. 1396r–6) is further amended— 
(A) 
by 
redesignating 
subsections 
(c) 
through (f) as subsections (d) through (g); and 
(B) by inserting after subsection (b) the 
following new subsection: 
‘‘(c) STATE OPTION OF UP TO 12 MONTHS OF ADDI-
TIONAL ELIGIBILITY.— 
‘‘(1) IN GENERAL.—Notwithstanding any other 
provision of this title, each State plan approved 
under this title may provide, at the option of the 
State, that the State shall offer to each family which 
received assistance during the entire 6-month period 
under subsection (b) and which meets the applicable 
requirement of paragraph (2), in the last month of
the period the option of extending coverage under 
this subsection for the succeeding period not to ex-
ceed 12 months. 
‘‘(2) INCOME RESTRICTION.—The option under 
paragraph (1) shall not be made available to a fam-
ily for a succeeding period unless the State deter-
mines that the family’s average gross monthly earn-
ings (less such costs for such child care as is nec-
essary for the employment of the caretaker relative) 
as of the end of the 6-month period under sub-
section (b) does not exceed 185 percent of the offi-
cial poverty line (as defined by the Office of Man-
agement and Budget, and revised annually in ac-
cordance with section 673(2) of the Omnibus Budget 
Reconciliation Act of 1981) applicable to a family of 
the size involved. 
‘‘(3) APPLICATION
OF
EXTENSION
RULES.— 
The provisions of paragraphs (2), (3), (4), and (5) 
of subsection (b) shall apply to the extension pro-
vided under this subsection in the same manner as 
they apply to the extension provided under sub-
section (b)(1), except that for purposes of this sub-
section— 
‘‘(A) any reference to a 6-month period 
under subsection (b)(1) is deemed a reference
to the extension period provided under para-
graph (1) and any deadlines for any notices or 
reporting and the premium payment periods 
shall be modified to correspond to the appro-
priate calendar quarters of coverage provided 
under this subsection; and 
‘‘(B) any reference to a provision of sub-
section (a) or (b) is deemed a reference to the 
corresponding provision of subsection (b) or of 
this subsection, respectively.’’. 
(b) STATE OPTION TO WAIVE RECEIPT OF MED-
ICAID FOR 3 OF PREVIOUS 6 MONTHS TO QUALIFY FOR 
TMA.—Section 1925(a)(1) of such Act (42 U.S.C. 1396r– 
6(a)(1)) is amended by adding at the end the following: 
‘‘A State may, at its option, also apply the previous sen-
tence in the case of a family that was receiving such aid 
for fewer than 3 months, or that had applied for and was 
eligible for such aid for fewer than 3 months, during the 
6 immediately preceding months described in such sen-
tence.’’. 
(c) ELIMINATION OF SUNSET FOR TMA.— 
(1) Subsection (g) of section 1925 of such Act 
(42 U.S.C. 1396r–6), as redesignated under sub-
section (a)(2), is repealed.
(2) Section 1902(e)(1) of such Act (42 U.S.C. 
1396a(e)(1)) 
is 
amended 
by 
striking 
‘‘(A) 
Nothwithstanding’’ and all that follows through 
‘‘During such period, for’’ in subparagraph (B) and 
inserting ‘‘For’’. 
(d) CMS REPORT ON ENROLLMENT AND PARTICIPA-
TION RATES UNDER TMA.—Section 1925 of such Act, 
as amended by subsections (a)(2) and (c)(1), is amended 
by adding at the end the following new subsection: 
‘‘(g) ADDITIONAL PROVISIONS.— 
‘‘(1) COLLECTION AND REPORTING OF PARTICI-
PATION INFORMATION.—Each State shall— 
‘‘(A) collect and submit to the Secretary, 
in a format specified by the Secretary, informa-
tion on average monthly enrollment and average 
monthly participation rates for adults and chil-
dren under this section; and 
‘‘(B) make such information publicly avail-
able. 
Such information shall be submitted under subpara-
graph (A) at the same time and frequency in which 
other enrollment information under this title is sub-
mitted to the Secretary. Using such information, the 
Secretary shall submit to Congress annual reports 
concerning such rates.’’.
(e) COORDINATION OF WORK.—Section 1925(g) of 
such Act, as added by subsection (d), is amended by add-
ing at the end the following new paragraph: 
‘‘(2) COORDINATION
WITH
ADMINISTRATION 
FOR CHILDREN AND FAMILIES.—The Administrator 
of the Centers for Medicare & Medicaid Services, in 
carrying out this section, shall work with the Assist-
ant Secretary for the Administration for Children 
and Families to develop guidance or other technical 
assistance for States regarding best practices in 
guaranteeing access to transitional medical assist-
ance under this section.’’. 
(f) ELIMINATION
OF
TMA REQUIREMENT
FOR 
STATES THAT EXTEND COVERAGE TO CHILDREN AND 
PARENTS THROUGH 185 PERCENT OF POVERTY.— 
(1) IN GENERAL.—Section 1925 of such Act is 
further amended by adding at the end the following 
new subsection: 
‘‘(h) PROVISIONS OPTIONAL FOR STATES THAT EX-
TEND COVERAGE TO CHILDREN AND PARENTS THROUGH 
185 PERCENT OF POVERTY.—A State may (but is not re-
quired to) meet the requirements of subsections (a) and 
(b) if it provides for medical assistance under section 1931 
to families (including both children and caretaker rel-
atives) the average gross monthly earning of which (less
such costs for such child care as is necessary for the em-
ployment of a caretaker relative) is at or below a level that 
is at least 185 percent of the official poverty line (as de-
fined by the Office of Management and Budget, and re-
vised annually in accordance with section 673(2) of the 
Omnibus Budget Reconciliation Act of 1981) applicable 
to a family of the size involved.’’. 
(2) CONFORMING AMENDMENTS.—Such section 
is further amended, in subsections (a)(1) and (b)(1), 
by inserting ‘‘, but subject to subsection (h),’’ after 
‘‘Notwithstanding any other provision of this title,’’ 
each place it appears. 
(g) EXTENDING USE OF OUTSTATIONED WORKERS 
TO ACCEPT APPLICATIONS FOR TRANSITIONAL MEDICAL 
ASSISTANCE.—Section 1902(a)(55) of such Act (42 
U.S.C. 1396a(a)(55)) is amended by inserting ‘‘and under 
section 1931’’ after ‘‘(a)(10)(A)(ii)(IX)’’. 
(h) EFFECTIVE DATES.—(1) Except as provided in 
this subsection, the amendments made by this section shall 
apply to calendar quarters beginning on or after the date 
of the enactment of this Act, without regard to whether 
or not final regulations to carry out such amendments 
have been promulgated by such date. 
(2) In the case of a State plan for medical assistance 
under title XIX of the Social Security Act which the Sec-
retary of Health and Human Services determines requires 
State legislation (other than legislation appropriating 
funds) in order for the plan to meet the additional require-
ments imposed by the amendments made by this section, 
the State plan shall not be regarded as failing to comply 
with the requirements of such title 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 the 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 
such session shall be deemed to be a separate regular ses-
sion of the State legislature. 
SEC. 9. LIMITATIONS ON CONFLICTS OF INTEREST. 
(a) LIMITATION
ON CONFLICTS
OF INTEREST
IN 
MARKETING ACTIVITIES.— 
(1) TITLE XXI.—Section 2105(c) of the Social 
Security Act (42 U.S.C. 300aa–5(c)) is amended by 
adding at the end the following: 
‘‘(8) LIMITATION ON EXPENDITURES FOR MAR-
KETING ACTIVITIES.—Amounts expended by a State 
for the use of an administrative vendor in marketing 
health benefits coverage to low-income children 
under this title shall not be considered, for purposes
of subsection (a)(2)(D), to be reasonable costs to ad-
minister the plan unless the following conditions are 
met with respect to the vendor: 
‘‘(A) The vendor is independent of any en-
tity offering the coverage in the same area of 
the State in which the vendor is conducting 
marketing activities. 
‘‘(B) No person who is an owner, em-
ployee, consultant, or has a contract with the 
vendor either has any direct or indirect finan-
cial interest with such an entity or has been ex-
cluded from participation in the program under 
this title or title XVIII or XIX or debarred by 
any Federal agency, or subject to a civil money 
penalty under this Act.’’. 
(b) PROHIBITION OF AFFILIATION WITH DEBARRED 
INDIVIDUALS.— 
(1) MEDICAID.—Section 1903(i) of the Social 
Security Act (42 U.S.C. 1396b(i))is amended— 
(A) by striking the period at the end of 
paragraph (20) and inserting ‘‘; or’’; and 
(B) by inserting after paragraph (20) the 
following:
‘‘(21) with respect to any amounts expended for 
an entity that receives payments under the plan un-
less— 
‘‘(A) no person with an ownership or con-
trol interest (as defined in section 1124(a)(3)) 
in the entity is a person that is debarred, sus-
pended, or otherwise excluded from partici-
pating in procurement or non-procurement ac-
tivities under the Federal Acquisition Regula-
tion; and 
‘‘(B) such entity has not entered into an 
employment, consulting, or other agreement for 
the provision of items or services that are mate-
rial to such entity’s obligations under the plan 
with a person described in subparagraph (A).’’. 
(2) TITLE XXI.—Section 2107(e)(1) of the So-
cial Security Act (42 U.S.C. 1397gg(e)(1)), as 
amended by section 5(b), is further amended— 
(A) in subparagraph (B), by striking ‘‘and 
(17)’’ and inserting ‘‘(17), and (21)’’; and 
(B) by adding at the end the following: 
‘‘(F) Section 1902(a)(67) (relating to pro-
hibition of affiliation with debarred individ-
uals).’’.
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to expenditures made on or after 
July 1, 2006, whether or not regulations implementing 
such amendments have been issued. 
SEC. 10. DEMONSTRATION PROGRAMS TO IMPROVE MED-
ICAID AND CHIP OUTREACH TO HOMELESS 
INDIVIDUALS AND FAMILIES. 
(a) AUTHORITY.—The Secretary of Health and 
Human Services may award demonstration grants to not 
more than 7 States (or other qualified entities) to conduct 
innovative programs that are designed to improve out-
reach to homeless individuals and families under the pro-
grams described in subsection (b) with respect to enroll-
ment of such individuals and families under such pro-
grams and the provision of services (and coordinating the 
provision of such services) under such programs. 
(b) PROGRAMS FOR HOMELESS DESCRIBED.—The 
programs described in this subsection are as follows: 
(1) MEDICAID.—The program under title XIX 
of the Social Security Act (42 U.S.C. 1396 et seq.). 
(2) CHIP.—The program under title XXI of 
the Social Security Act (42 U.S.C. 1397aa et seq.). 
(3) TANF.—The program under part of A of 
title IV of the Social Security Act (42 U.S.C. 601 
et seq.).
(4) SAMHSA BLOCK GRANTS.—The program 
of grants under part B of title XIX of the Public 
Health Service Act (42 U.S.C. 300x–1 et seq.). 
(5) FOOD
STAMP
PROGRAM.—The program 
under the Food Stamp Act of 1977 (7 U.S.C. 2011 
et seq.). 
(6) WORKFORCE INVESTMENT ACT.—The pro-
gram under the Workforce Investment Act of 1999 
(29 U.S.C. 2801 et seq.). 
(7) WELFARE-TO-WORK.—The welfare-to-work 
program under section 403(a)(5) of the Social Secu-
rity Act (42 U.S.C. 603(a)(5)). 
(8) OTHER PROGRAMS.—Other public and pri-
vate benefit programs that serve low-income individ-
uals. 
(c) APPROPRIATIONS.—For the purposes of carrying 
out this section, there is appropriated for fiscal year 2006, 
out of any funds in the Treasury not otherwise appro-
priated, $10,000,000, to remain available until expended. 
SEC. 11. ADDITIONAL CHIP REVISIONS. 
(a) LIMITING COST-SHARING TO 2.5 PERCENT FOR 
FAMILIES WITH INCOME BELOW 150 PERCENT OF POV-
ERTY.—Section 2103(e)(3)(A) of the Social Security Act 
(42 U.S.C. 1397cc(e)(3)(A)) is amended— 
(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) total annual aggregate cost- 
sharing described in clauses (i) and (ii) 
with respect to all such targeted low-in-
come children in a family under this title 
that exceeds 2.5 percent of such family’s 
income for the year involved.’’. 
(b) EMPLOYER COVERAGE WAIVER CHANGES.—Sec-
tion 2105(c)(3) of such Act (42 U.S.C. 1397ee(c)(3)) is 
amended— 
(1) by redesignating subparagraphs (A) and 
(B) as clauses (i) and (ii) and indenting appro-
priately; 
(2) by designating the matter beginning with 
‘‘Payment may be made’’ as a subparagraph (A) 
with the heading ‘‘IN GENERAL’’ and indenting ap-
propriately; and 
(3) by adding at the end the following new sub-
paragraph: 
‘‘(B) APPLICATION OF REQUIREMENTS.— 
In carrying out subparagraph (A)—
‘‘(i) in determining cost-effectiveness, 
the Secretary shall measure against family 
coverage costs to the extent that a State 
has expanded coverage to parents pursuant 
to section 2111; 
‘‘(ii) subject to clause (iii), the State 
shall provide satisfactory assurances that 
the minimum benefits and cost-sharing 
protections established under this title are 
provided, either through the coverage 
under subparagraph (A) or as a supple-
ment to such coverage; and 
‘‘(iii) coverage under such subpara-
graph shall not be considered to violate 
clause (ii) because it does not comply with 
requirements relating to reviews of health 
service decisions if the enrollee involved is 
provided the option of being provided bene-
fits directly under this title.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section apply as of January 1, 2006, whether or not 
regulations implementing such amendments have been 
issued.
SEC. 12. INCREASED FEDERAL REIMBURSEMENT FOR LAN-
GUAGE SERVICES UNDER THE MEDICAID 
PROGRAM AND TITLE XXI. 
(a) MEDICAID.—Section 1903(a)(3) of the Social Se-
curity Act (42 U.S.C. 1396b(a)(3)) is amended— 
(1) in subparagraph (D), by striking ‘‘plus’’ at 
the end and inserting ‘‘and’’; and 
(2) by adding at the end the following: 
‘‘(E) 90 percent of the sums expended with 
respect to costs incurred during such quarter as 
are attributable to the provision of language 
services, including oral interpretation, trans-
lations of written materials, and other language 
services, for individuals with limited English 
proficiency who apply for, or receive, medical 
assistance under the State plan; plus’’. 
(b) SCHIP.—Section 2105(a)(1) of the Social Secu-
rity Act (42 U.S.C.1397ee(a)) is amended— 
(1) in the matter preceding subparagraph (A), 
by inserting ‘‘or, in the case of expenditures de-
scribed in subparagraph (D)(iv), 90 percent’’ after 
‘‘enhanced FMAP’’; and 
(2) in subparagraph (D)— 
(A) in clause (iii), by striking ‘‘and’’ at the 
end;
(B) be redesignating clause (iv) as clause 
(v); and 
(C) by inserting after clause (iii) the fol-
lowing: 
‘‘(iv) for expenditures attributable to 
the provision of language services, includ-
ing oral interpretation, translations of 
written materials, and other language serv-
ices, for individuals with limited English 
proficiency who apply for, or receive, child 
health assistance under the plan; and’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section take effect on January 1, 2006. 
Æ