ploy and how the State will reduce adverse risk se-
lection. 
‘‘(16) OTHER MATTERS.—Any other matter de-
termined appropriate by the Secretary. 
‘‘(b) CURRENT LEVEL OF COVERAGE.— 
‘‘(1) IN GENERAL.—The Secretary shall develop 
a standardized survey approach that provides timely 
and up-to-date data to determine the percentage of 
the population of each State that is currently cov-
ered by a health insurance plan or program that 
provides coverage that meets the requirements of 
section 2203(a). 
‘‘(2) BIANNUAL SURVEY.—The Secretary shall 
provide for the conduct of the survey developed 
under paragraph (1) not less than biannually to 
make coverage determinations for purposes of para-
graph (1). 
‘‘(3) USE OF ALTERNATIVE SYSTEM.—The Sec-
retary shall permit a State to utilize an alternative 
population-based monitoring system to make deter-
minations with respect to coverage in the State for 
purposes of paragraph (1) if the Secretary deter-
mines that such system meets or exceeds the meth-
odological standards utilized in the survey developed 
under paragraph (1).
‘‘(4) BASE COVERAGE GAP.—For purposes of 
subsection (a)(1)(A), the base coverage gap for a 
State shall be equal to 100 percent of the eligible in-
dividuals and families in the State for the year in-
volved, less the current level of coverage for those in-
dividuals and families for such year as determined 
under paragraph (1) or (3). 
‘‘(c) REDUCING THE LEVEL OF UNINSURED INDIVID-
UALS.— 
‘‘(1) IN GENERAL.—To be eligible to receive 
funds under this part, a State shall agree to admin-
ister an expansion phase (phase I) plan with a goal 
of providing health insurance coverage for 100 per-
cent of the eligible residents of the State by not later 
than 4 years after the date of approval of the State’s 
expansion phase (phase I) plan. 
‘‘(2) PERMISSIBLE ACTIVITIES.—A State may 
use amounts provided under this part for any activi-
ties consistent with this part that are appropriate to 
enroll individuals in health plans and health pro-
grams to meet the targets contained in the State 
plan under subsection (a)(2)(B), including through 
the use of direct payments to health plans or, in the 
case of a single State plan, directly to providers of 
services.
‘‘(d) PROCESS
FOR SUBMISSION, APPROVAL, AND 
AMENDMENT OF EXPANSION PHASE (PHASE I) PLAN.— 
The provisions of section 2106 apply to an expansion 
phase (phase I) plan under this part in the same manner 
as they apply to a State plan under title XXI, except that 
no expansion phase (phase I) plan may be effective earlier 
than January 1, 2005, and all expansion phase (phase I) 
plans must be submitted for approval by not later than 
December 31, 2006. 
‘‘SEC. 2203. COVERAGE REQUIREMENTS FOR EXPANSION 
PHASE (PHASE I) PLANS. 
‘‘(a) REQUIRED SCOPE OF HEALTH INSURANCE COV-
ERAGE.—Health insurance coverage provided under this 
part shall consist of at least the benefits provided under 
the Federal Employees Health Benefits Program standard 
Blue Cross/Blue Shield preferred provider option service 
benefit plan, described in and offered under section 
8903(1) of part 5, United States Code, plus mental health 
and substance abuse treatment benefits parity for all indi-
viduals, and benefits for early and periodic screening and 
diagnosis services (EPSDT) under section 1905(a)(4)(B) 
for all individuals under 21 years of age. 
‘‘(b) LIMITATIONS ON PREMIUMS AND COST-SHAR-
ING.—