†
126
HR 976 EAS
(i) by realigning the left margin of the
matter preceding clause (i) 2 ems to the left;
and
(ii) by realigning the left margins of
clauses (i) and (ii), respectively, 2 ems to
the left.
(c) APPLICATION
OF DOCUMENTATION SYSTEM
TO
CHIP.—
(1) IN GENERAL.—Section 2105(c) (42 U.S.C.
1397ee(c)), as amended by section 110(a), is amended
by adding at the end the following new paragraph:
‘‘(9) CITIZENSHIP
DOCUMENTATION
REQUIRE-
MENTS.—
‘‘(A) IN
GENERAL.—No payment may be
made under this section with respect to an indi-
vidual who has, or is, declared to be a citizen or
national of the United States for purposes of es-
tablishing eligibility under this title unless the
State 
meets 
the 
requirements 
of 
section
1902(a)(46)(B) with respect to the individual.
‘‘(B) 
ENHANCED
PAYMENTS.—Notwith-
standing subsection (b), the enhanced FMAP
with respect to payments under subsection (a)
for expenditures described in clause (i) or (ii) of
section 1903(a)(3)(F) necessary to comply with
†
127
HR 976 EAS
subparagraph (A) shall in no event be less than
90 percent and 75 percent, respectively.’’.
(2) NONAPPLICATION
OF
ADMINISTRATIVE
EX-
PENDITURES CAP.—Section 2105(c)(2)(C) (42 U.S.C.
1397ee(c)(2)(C)), as amended by section 202(b), is
amended by adding at the end the following:
‘‘(iii) 
EXPENDITURES
TO
COMPLY
WITH
CITIZENSHIP
OR
NATIONALITY
VERIFICATION
REQUIREMENTS.—Expendi-
tures necessary for the State to comply with
paragraph (9)(A).’’.
(d) EFFECTIVE DATE.—
(1) IN GENERAL.—
(A) IN GENERAL.—Except as provided in
subparagraph (B), the amendments made by this
section shall take effect on October 1, 2008.
(B) 
TECHNICAL
AMENDMENTS.—The
amendments made by—
(i) paragraphs (1), (2), and (3) of sub-
section (b) shall take effect as if included in
the enactment of section 6036 of the Deficit
Reduction Act of 2005 (Public Law 109–
171; 120 Stat. 80); and
(ii) paragraph (4) of subsection (b)
shall take effect as if included in the enact-
†
128
HR 976 EAS
ment of section 405 of division B of the Tax
Relief and Health Care Act of 2006 (Public
Law 109–432; 120 Stat. 2996).
(2) RESTORATION OF ELIGIBILITY.—In the case
of an individual who, during the period that began
on July 1, 2006, and ends on October 1, 2008, was
determined to be ineligible for medical assistance
under a State Medicaid plan, including any waiver
of such plan, solely as a result of the application of
subsections (i)(22) and (x) of section 1903 of the So-
cial Security Act (as in effect during such period),
but who would have been determined eligible for such
assistance if such subsections, as amended by sub-
section (b), had applied to the individual, a State
may deem the individual to be eligible for such assist-
ance as of the date that the individual was deter-
mined to be ineligible for such medical assistance on
such basis.
(3) SPECIAL TRANSITION RULE FOR INDIANS.—
During the period that begins on July 1, 2006, and
ends on the effective date of final regulations issued
under subclause (II) of section 1903(x)(3)(B)(v) of the
Social Security Act (42 U.S.C. 1396b(x)(3)(B)(v)) (as
added by subsection (b)(1)(B)), an individual who is
a member of a federally-recognized Indian tribe de-
†
129
HR 976 EAS
scribed in subclause (II) of that section who presents
a document described in subclause (I) of such section
that is issued by such Indian tribe, shall be deemed
to have presented satisfactory evidence of citizenship
or nationality for purposes of satisfying the require-
ment of subsection (x) of section 1903 of such Act.
SEC. 302. REDUCING ADMINISTRATIVE BARRIERS TO EN-
ROLLMENT.
Section 2102(b) (42 U.S.C. 1397bb(b)) is amended—
(1) by redesignating paragraph (4) as para-
graph (5); and
(2) by inserting after paragraph (3) the fol-
lowing new paragraph:
‘‘(4) REDUCTION OF ADMINISTRATIVE BARRIERS
TO ENROLLMENT.—
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), the plan shall include a description
of the procedures used to reduce administrative
barriers to the enrollment of children and preg-
nant women who are eligible for medical assist-
ance under title XIX or for child health assist-
ance or health benefits coverage under this title.
Such procedures shall be established and revised
as often as the State determines appropriate to
†
130
HR 976 EAS
take into account the most recent information
available to the State identifying such barriers.
‘‘(B) DEEMED COMPLIANCE IF JOINT APPLI-
CATION AND RENEWAL PROCESS THAT PERMITS
APPLICATION OTHER THAN IN PERSON.—A State
shall be deemed to comply with subparagraph
(A) if the State’s application and renewal forms
and supplemental forms (if any) and informa-
tion verification process is the same for purposes
of establishing and renewing eligibility for chil-
dren and pregnant women for medical assistance
under title XIX and child health assistance
under this title, and such process does not re-
quire an application to be made in person or a
face-to-face interview.’’.
TITLE IV—REDUCING BARRIERS
TO PROVIDING PREMIUM AS-
SISTANCE
Subtitle A—Additional State Option
for Providing Premium Assistance
SEC. 401. ADDITIONAL STATE OPTION FOR PROVIDING PRE-
MIUM ASSISTANCE.
(a) IN
GENERAL.—Section 2105(c) (42 U.S.C.
1397ee(c)), as amended by section 301(c), is amended by
adding at the end the following:
†
131
HR 976 EAS
‘‘(10) STATE OPTION TO OFFER PREMIUM AS-
SISTANCE.—
‘‘(A) IN
GENERAL.—Subject to the suc-
ceeding provisions of this paragraph, a State
may elect to offer a premium assistance subsidy
(as defined in subparagraph (C)) for qualified
employer-sponsored coverage (as defined in sub-
paragraph (B)) to all targeted low-income chil-
dren who are eligible for child health assistance
under the plan and have access to such coverage
in accordance with the requirements of this
paragraph.
‘‘(B) 
QUALIFIED
EMPLOYER-SPONSORED
COVERAGE.—
‘‘(i) IN GENERAL.—Subject to clauses
(ii) and (iii), in this paragraph, the term
‘qualified 
employer-sponsored 
coverage’
means a group health plan or health insur-
ance 
coverage 
offered 
through 
an
employer—
‘‘(I) that qualifies as creditable
coverage as a group health plan under
section 2701(c)(1) of the Public Health
Service Act;
†
132
HR 976 EAS
‘‘(II) for which the employer con-
tribution toward any premium for
such coverage is at least 40 percent;
and
‘‘(III) to all individuals in a
manner that would be considered a
nondiscriminatory 
eligibility 
classi-
fication for purposes of paragraph
(3)(A)(ii) of section 105(h) of the In-
ternal Revenue Code of 1986 (but de-
termined without regard to clause (i)
of subparagraph (B) of such para-
graph).
‘‘(ii) EXCEPTION.—Such term does not
include coverage consisting of—
‘‘(I) benefits provided under a
health flexible spending arrangement
(as defined in section 106(c)(2) of the
Internal Revenue Code of 1986); or
‘‘(II) a high deductible health
plan (as defined in section 223(c)(2) of
such Code) purchased in conjunction
with a health savings account (as de-
fined under section 223(d) of such
Code).
†
133
HR 976 EAS
‘‘(iii) 
COST-EFFECTIVENESS
ALTER-
NATIVE TO REQUIRED EMPLOYER CONTRIBU-
TION.—A group health plan or health insur-
ance coverage offered through an employer
that would be considered qualified em-
ployer-sponsored coverage but for the appli-
cation of clause (i)(II) may be deemed to
satisfy the requirement of such clause if ei-
ther of the following applies:
‘‘(I) 
APPLICATION
OF
CHILD-
BASED OR FAMILY-BASED TEST.—The
State establishes to the satisfaction of
the Secretary that the cost of such cov-
erage is less than the expenditures that
the State would have made to enroll
the child or the family (as applicable)
in the State child health plan.
‘‘(II) 
AGGREGATE
PROGRAM
OPERATIONAL COSTS DO NOT EXCEED
THE
COST
OF
PROVIDING
COVERAGE
UNDER
THE
STATE
CHILD
HEALTH
PLAN.—If subclause (I) does not apply,
the State establishes to the satisfaction
of the Secretary that the aggregate
amount of expenditures by the State
†
134
HR 976 EAS
for the purchase of all such coverage for
targeted low-income children under the
State child health plan (including ad-
ministrative expenditures) does not ex-
ceed the aggregate amount of expendi-
tures that the State would have made
for providing coverage under the State
child health plan for all such children.
‘‘(C) PREMIUM ASSISTANCE SUBSIDY.—
‘‘(i) IN GENERAL.—In this paragraph,
the term ‘premium assistance subsidy’
means, with respect to a targeted low-in-
come child, the amount equal to the dif-
ference between the employee contribution
required for enrollment only of the employee
under qualified employer-sponsored coverage
and the employee contribution required for
enrollment of the employee and the child in
such coverage, less any applicable premium
cost-sharing applied under the State child
health plan (subject to the limitations im-
posed under section 2103(e), including the
requirement to count the total amount of the
employee contribution required for enroll-
ment of the employee and the child in such
†
135
HR 976 EAS
coverage toward the annual aggregate cost-
sharing limit applied under paragraph
(3)(B) of such section).
‘‘(ii) STATE
PAYMENT
OPTION.—A
State may provide a premium assistance
subsidy either as reimbursement to an em-
ployee for out-of-pocket expenditures or, sub-
ject to clause (iii), directly to the employee’s
employer.
‘‘(iii) EMPLOYER
OPT-OUT.—An em-
ployer may notify a State that it elects to
opt-out of being directly paid a premium
assistance subsidy on behalf of an employee.
In the event of such a notification, an em-
ployer shall withhold the total amount of
the employee contribution required for en-
rollment of the employee and the child in
the qualified employer-sponsored coverage
and the State shall pay the premium assist-
ance subsidy directly to the employee.
‘‘(iv) TREATMENT AS CHILD HEALTH
ASSISTANCE.—Expenditures for the provi-
sion of premium assistance subsidies shall
be considered child health assistance de-
scribed in paragraph (1)(C) of subsection
†
136
HR 976 EAS
(a) for purposes of making payments under
that subsection.
‘‘(D) APPLICATION
OF
SECONDARY
PAYOR
RULES.—The State shall be a secondary payor
for any items or services provided under the
qualified employer-sponsored coverage for which
the State provides child health assistance under
the State child health plan.
‘‘(E) REQUIREMENT TO PROVIDE SUPPLE-
MENTAL
COVERAGE
FOR
BENEFITS
AND
COST-
SHARING
PROTECTION
PROVIDED
UNDER
THE
STATE CHILD HEALTH PLAN.—
‘‘(i) IN
GENERAL.—Notwithstanding
section 2110(b)(1)(C), the State shall pro-
vide for each targeted low-income child en-
rolled in qualified employer-sponsored cov-
erage, supplemental coverage consisting of—
‘‘(I) items or services that are not
covered, or are only partially covered,
under the qualified employer-sponsored
coverage; and
‘‘(II) cost-sharing protection con-
sistent with section 2103(e).
‘‘(ii) 
RECORD
KEEPING
REQUIRE-
MENTS.—For purposes of carrying out
†
137
HR 976 EAS
clause (i), a State may elect to directly pay
out-of-pocket expenditures for cost-sharing
imposed under the qualified employer-spon-
sored coverage and collect or not collect all
or any portion of such expenditures from
the parent of the child.
‘‘(F) APPLICATION OF WAITING PERIOD IM-
POSED UNDER THE STATE.—Any waiting period
imposed under the State child health plan prior
to the provision of child health assistance to a
targeted low-income child under the State plan
shall apply to the same extent to the provision
of a premium assistance subsidy for the child
under this paragraph.
‘‘(G) 
OPT-OUT
PERMITTED
FOR
ANY
MONTH.—A State shall establish a process for
permitting the parent of a targeted low-income
child receiving a premium assistance subsidy to
disenroll the child from the qualified employer-
sponsored coverage and enroll the child in, and
receive child health assistance under, the State
child health plan, effective on the first day of
any month for which the child is eligible for such
assistance and in a manner that ensures con-
tinuity of coverage for the child.
†
138
HR 976 EAS
‘‘(H) APPLICATION
TO
PARENTS.—If a
State provides child health assistance or health
benefits coverage to parents of a targeted low-in-
come child in accordance with section 2111(b),
the State may elect to offer a premium assistance
subsidy to a parent of a targeted low-income
child who is eligible for such a subsidy under
this paragraph in the same manner as the State
offers such a subsidy for the enrollment of the
child in qualified employer-sponsored coverage,
except that—
‘‘(i) the amount of the premium assist-
ance subsidy shall be increased to take into
account the cost of the enrollment of the
parent in the qualified employer-sponsored
coverage or, at the option of the State if the
State determines it cost-effective, the cost of
the enrollment of the child’s family in such
coverage; and
‘‘(ii) any reference in this paragraph
to a child is deemed to include a reference
to the parent or, if applicable under clause
(i), the family of the child.
‘‘(I) ADDITIONAL STATE OPTION FOR PRO-
VIDING PREMIUM ASSISTANCE.—
†
139
HR 976 EAS
‘‘(i) IN GENERAL.—A State may estab-
lish an employer-family premium assistance
purchasing pool for employers with less
than 250 employees who have at least 1 em-
ployee who is a pregnant woman eligible for
assistance under the State child health plan
(including through the application of an
option described in section 2112(f)) or a
member of a family with at least 1 targeted
low-income child and to provide a premium
assistance subsidy under this paragraph for
enrollment in coverage made available
through such pool.
‘‘(ii) ACCESS
TO
CHOICE
OF
COV-
ERAGE.—A State that elects the option
under clause (i) shall identify and offer ac-
cess to not less than 2 private health plans
that are health benefits coverage that is
equivalent to the benefits coverage in a
benchmark benefit package described in sec-
tion 2103(b) or benchmark-equivalent cov-
erage that meets the requirements of section
2103(a)(2) for employees described in clause
(i).
†
140
HR 976 EAS
‘‘(J) NO EFFECT ON PREMIUM ASSISTANCE
WAIVER PROGRAMS.—Nothing in this paragraph
shall be construed as limiting the authority of a
State to offer premium assistance under section
1906, a waiver described in paragraph (2)(B) or
(3), a waiver approved under section 1115, or
other authority in effect prior to the date of en-
actment of the Children’s Health Insurance Pro-
gram Reauthorization Act of 2007.
‘‘(K) NOTICE OF AVAILABILITY.—If a State
elects to provide premium assistance subsidies in
accordance with this paragraph, the State
shall—
‘‘(i) include on any application or en-
rollment form for child health assistance a
notice of the availability of premium assist-
ance subsidies for the enrollment of targeted
low-income children in qualified employer-
sponsored coverage;
‘‘(ii) provide, as part of the applica-
tion and enrollment process under the State
child health plan, information describing
the availability of such subsidies and how to
elect to obtain such a subsidy; and
†
141
HR 976 EAS
‘‘(iii) establish such other procedures as
the State determines necessary to ensure
that parents are fully informed of the
choices for receiving child health assistance
under the State child health plan or through
the receipt of premium assistance subsidies.
‘‘(L) APPLICATION
TO
QUALIFIED
EM-
PLOYER-SPONSORED BENCHMARK COVERAGE.—If
a group health plan or health insurance coverage
offered through an employer is certified by an
actuary as health benefits coverage that is equiv-
alent to the benefits coverage in a benchmark
benefit package described in section 2103(b) or
benchmark-equivalent coverage that meets the re-
quirements of section 2103(a)(2), the State may
provide premium assistance subsidies for enroll-
ment of targeted low-income children in such
group health plan or health insurance coverage
in the same manner as such subsidies are pro-
vided under this paragraph for enrollment in
qualified employer-sponsored coverage, but with-
out regard to the requirement to provide supple-
mental coverage for benefits and cost-sharing
protection provided under the State child health
plan under subparagraph (E).’’.
†
142
HR 976 EAS
(b) APPLICATION TO MEDICAID.—Section 1906 (42
U.S.C. 1396e) is amended by inserting after subsection (c)
the following:
‘‘(d) A State may elect to offer a premium assistance
subsidy (as defined in section 2105(c)(10)(C)) for qualified
employer-sponsored 
coverage 
(as 
defined 
in 
section
2105(c)(10)(B)) to a child who is eligible for medical assist-
ance under the State plan under this title, to the parent
of such a child, and to a pregnant woman, in the same
manner as such a subsidy for such coverage may be offered
under a State child health plan under title XXI in accord-
ance with section 2105(c)(10) (except that subparagraph
(E)(i)(II) of such section shall be applied by substituting
‘1916 or, if applicable, 1916A’ for ‘2103(e)’).’’.
(c) GAO STUDY AND REPORT.—Not later than Janu-
ary 1, 2009, the Comptroller General of the United States
shall study cost and coverage issues relating to any State
premium assistance programs for which Federal matching
payments are made under title XIX or XXI of the Social
Security Act, including under waiver authority, and shall
submit a report to the appropriate committees of Congress
on the results of such study.
†
143
HR 976 EAS
SEC. 402. OUTREACH, EDUCATION, AND ENROLLMENT AS-
SISTANCE.
(a) REQUIREMENT TO INCLUDE DESCRIPTION
OF
OUTREACH, EDUCATION, AND ENROLLMENT EFFORTS RE-
LATED TO PREMIUM ASSISTANCE SUBSIDIES IN STATE
CHILD
HEALTH
PLAN.—Section 2102(c) (42 U.S.C.
1397bb(c)) is amended by adding at the end the following
new paragraph:
‘‘(3) PREMIUM
ASSISTANCE
SUBSIDIES.—Out-
reach, education, and enrollment assistance for fami-
lies of children likely to be eligible for premium as-
sistance subsidies under the State child health plan in
accordance with paragraphs (2)(B), (3), or (10) of
section 2105(c), or a waiver approved under section
1115, to inform such families of the availability of,
and to assist them in enrolling their children in, such
subsidies, and for employers likely to provide coverage
that is eligible for such subsidies, including the spe-
cific, significant resources the State intends to apply
to educate employers about the availability of pre-
mium assistance subsidies under the State child
health plan.’’.
(b) NONAPPLICATION OF 10 PERCENT LIMIT ON OUT-
REACH
AND CERTAIN OTHER EXPENDITURES.—Section
2105(c)(2)(C) (42 U.S.C. 1397ee(c)(2)(C)), as amended by
†
144
HR 976 EAS
section 301(c)(2), is amended by adding at the end the fol-
lowing new clause:
‘‘(iv) EXPENDITURES FOR OUTREACH
TO INCREASE THE ENROLLMENT OF CHIL-
DREN UNDER THIS TITLE AND TITLE XIX
THROUGH
PREMIUM
ASSISTANCE
SUB-
SIDIES.—Expenditures for outreach activi-
ties to families of children likely to be eligi-
ble for premium assistance subsidies in ac-
cordance with paragraphs (2)(B), (3), or
(10), or a waiver approved under section
1115, to inform such families of the avail-
ability of, and to assist them in enrolling
their children in, such subsidies, and to em-
ployers likely to provide qualified employer-
sponsored coverage (as defined in subpara-
graph (B) of such paragraph).’’.
†
145
HR 976 EAS
Subtitle B—Coordinating Premium
Assistance With Private Coverage
SEC. 411. SPECIAL ENROLLMENT PERIOD UNDER GROUP
HEALTH PLANS IN CASE OF TERMINATION OF
MEDICAID OR CHIP COVERAGE OR ELIGI-
BILITY FOR ASSISTANCE IN PURCHASE OF
EMPLOYMENT-BASED COVERAGE; COORDINA-
TION OF COVERAGE.
(a) AMENDMENTS TO INTERNAL REVENUE CODE OF
1986.—Section 9801(f) of the Internal Revenue Code of
1986 (relating to special enrollment periods) is amended
by adding at the end the following new paragraph:
‘‘(3) SPECIAL
RULES
RELATING
TO
MEDICAID
AND CHIP.—
‘‘(A) IN GENERAL.—A group health plan
shall permit an employee who is eligible, but not
enrolled, for coverage under the terms of the plan
(or a dependent of such an employee if the de-
pendent is eligible, but not enrolled, for coverage
under such terms) to enroll for coverage under
the terms of the plan if either of the following
conditions is met:
‘‘(i) TERMINATION
OF
MEDICAID
OR
CHIP COVERAGE.—The employee or depend-
ent is covered under a Medicaid plan under
†
146
HR 976 EAS
title XIX of the Social Security Act or
under a State child health plan under title
XXI of such Act and coverage of the em-
ployee or dependent under such a plan is
terminated as a result of loss of eligibility
for such coverage and the employee requests
coverage under the group health plan not
later than 60 days after the date of termi-
nation of such coverage.
‘‘(ii) ELIGIBILITY
FOR
EMPLOYMENT
ASSISTANCE UNDER MEDICAID OR CHIP.—
The employee or dependent becomes eligible
for assistance, with respect to coverage
under the group health plan under such
Medicaid plan or State child health plan
(including under any waiver or demonstra-
tion project conducted under or in relation
to such a plan), if the employee requests
coverage under the group health plan not
later than 60 days after the date the em-
ployee or dependent is determined to be eli-
gible for such assistance.
‘‘(B) EMPLOYEE
OUTREACH
AND
DISCLO-
SURE.—
†
147
HR 976 EAS
‘‘(i) OUTREACH
TO
EMPLOYEES
RE-
GARDING AVAILABILITY OF MEDICAID AND
CHIP COVERAGE.—
‘‘(I) IN
GENERAL.—Each em-
ployer that maintains a group health
plan in a State that provides medical
assistance under a State Medicaid
plan under title XIX of the Social Se-
curity Act, or child health assistance
under a State child health plan under
title XXI of such Act, in the form of
premium assistance for the purchase of
coverage under a group health plan,
shall provide to each employee a writ-
ten notice informing the employee of
potential opportunities then currently
available in the State in which the em-
ployee resides for premium assistance
under such plans for health coverage of
the employee or the employee’s depend-
ents. For purposes of compliance with
this clause, the employer may use any
State-specific model notice developed in
accordance 
with 
section
701(f)(3)(B)(i)(II) of the Employee Re-
†
148
HR 976 EAS
tirement Income Security Act of 1974
(29 U.S.C. 1181(f)(3)(B)(i)(II)).
‘‘(II) OPTION
TO
PROVIDE
CON-
CURRENT
WITH
PROVISION
OF
SUM-
MARY
PLAN
DESCRIPTION.—An em-
ployer may provide the model notice
applicable to the State in which an
employee resides concurrent with the
furnishing of the summary plan de-
scription as provided in section 104(b)
of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1024).
‘‘(ii) 
DISCLOSURE
ABOUT
GROUP
HEALTH
PLAN
BENEFITS
TO
STATES
FOR
MEDICAID
AND
CHIP
ELIGIBLE
INDIVID-
UALS.—In the case of a participant or bene-
ficiary of a group health plan who is cov-
ered under a Medicaid plan of a State
under title XIX of the Social Security Act
or under a State child health plan under
title XXI of such Act, the plan adminis-
trator of the group health plan shall disclose
to the State, upon request, information
about the benefits available under the group
health plan in sufficient specificity, as de-
†
149
HR 976 EAS
termined under regulations of the Secretary
of Health and Human Services in consulta-
tion with the Secretary that require use of
the model coverage coordination disclosure
form developed under section 411(b)(1)(C)
of the Children’s Health Insurance Program
Reauthorization Act of 2007, so as to per-
mit the State to make a determination
(under paragraph (2)(B), (3), or (10) of
section 2105(c) of the Social Security Act or
otherwise) concerning the cost-effectiveness
of the State providing medical or child
health assistance through premium assist-
ance for the purchase of coverage under such
group health plan and in order for the
State to provide supplemental benefits re-
quired under paragraph (10)(E) of such sec-
tion or other authority.’’.
(b) CONFORMING AMENDMENTS.—
(1) AMENDMENTS
TO
EMPLOYEE
RETIREMENT
INCOME SECURITY ACT.—
(A) IN
GENERAL.—Section 701(f) of the
Employee Retirement Income Security Act of
1974 (29 U.S.C. 1181(f)) is amended by adding
at the end the following new paragraph:
†
150
HR 976 EAS
‘‘(3) SPECIAL RULES FOR APPLICATION IN CASE
OF MEDICAID AND CHIP.—
‘‘(A) IN GENERAL.—A group health plan,
and a health insurance issuer offering group
health insurance coverage in connection with a
group health plan, shall permit an employee who
is eligible, but not enrolled, for coverage under
the terms of the plan (or a dependent of such an
employee if the dependent is eligible, but not en-
rolled, for coverage under such terms) to enroll
for coverage under the terms of the plan if either
of the following conditions is met:
‘‘(i) TERMINATION
OF
MEDICAID
OR
CHIP COVERAGE.—The employee or depend-
ent is covered under a Medicaid plan under
title XIX of the Social Security Act or
under a State child health plan under title
XXI of such Act and coverage of the em-
ployee or dependent under such a plan is
terminated as a result of loss of eligibility
for such coverage and the employee requests
coverage under the group health plan (or
health insurance coverage) not later than 60
days after the date of termination of such
coverage.
†
151
HR 976 EAS
‘‘(ii) ELIGIBILITY
FOR
EMPLOYMENT
ASSISTANCE UNDER MEDICAID OR CHIP.—
The employee or dependent becomes eligible
for assistance, with respect to coverage
under the group health plan or health in-
surance coverage, under such Medicaid plan
or State child health plan (including under
any waiver or demonstration project con-
ducted under or in relation to such a plan),
if the employee requests coverage under the
group health plan or health insurance cov-
erage not later than 60 days after the date
the employee or dependent is determined to
be eligible for such assistance.
‘‘(B) COORDINATION WITH MEDICAID AND
CHIP.—
‘‘(i) OUTREACH
TO
EMPLOYEES
RE-
GARDING AVAILABILITY OF MEDICAID AND
CHIP COVERAGE.—
‘‘(I) IN
GENERAL.—Each em-
ployer that maintains a group health
plan in a State that provides medical
assistance under a State Medicaid
plan under title XIX of the Social Se-
curity Act, or child health assistance
†
152
HR 976 EAS
under a State child health plan under
title XXI of such Act, in the form of
premium assistance for the purchase of
coverage under a group health plan,
shall provide to each employee a writ-
ten notice informing the employee of
potential opportunities then currently
available in the State in which the em-
ployee resides for premium assistance
under such plans for health coverage of
the employee or the employee’s depend-
ents.
‘‘(II) MODEL NOTICE.—Not later
than 1 year after the date of enactment
of the Children’s Health Insurance
Program Reauthorization Act of 2007,
the Secretary and the Secretary of
Health and Human Services, in con-
sultation with Directors of State Med-
icaid agencies under title XIX of the
Social Security Act and Directors of
State CHIP agencies under title XXI
of such Act, shall jointly develop na-
tional and State-specific model notices
for purposes of subparagraph (A). The
†
153
HR 976 EAS
Secretary shall provide employers with
such model notices so as to enable em-
ployers to timely comply with the re-
quirements of subparagraph (A). Such
model notices shall include information
regarding how an employee may con-
tact the State in which the employee
resides for additional information re-
garding potential opportunities for
such premium assistance, including
how to apply for such assistance.
‘‘(III) OPTION TO PROVIDE CON-
CURRENT
WITH
PROVISION
OF
SUM-
MARY
PLAN
DESCRIPTION.—An em-
ployer may provide the model notice
applicable to the State in which an
employee resides concurrent with the
furnishing of the summary plan de-
scription as provided in section 104(b).
‘‘(ii) 
DISCLOSURE
ABOUT
GROUP
HEALTH
PLAN
BENEFITS
TO
STATES
FOR
MEDICAID
AND
CHIP
ELIGIBLE
INDIVID-
UALS.—In the case of a participant or bene-
ficiary of a group health plan who is cov-
ered under a Medicaid plan of a State
†
154
HR 976 EAS
under title XIX of the Social Security Act
or under a State child health plan under
title XXI of such Act, the plan adminis-
trator of the group health plan shall disclose
to the State, upon request, information
about the benefits available under the group
health plan in sufficient specificity, as de-
termined under regulations of the Secretary
of Health and Human Services in consulta-
tion with the Secretary that require use of
the model coverage coordination disclosure
form developed under section 411(b)(1)(C)
of the Children’s Health Insurance Program
Reauthorization Act of 2007, so as to per-
mit the State to make a determination
(under paragraph (2)(B), (3), or (10) of
section 2105(c) of the Social Security Act or
otherwise) concerning the cost-effectiveness
of the State providing medical or child
health assistance through premium assist-
ance for the purchase of coverage under such
group health plan and in order for the
State to provide supplemental benefits re-
quired under paragraph (10)(E) of such sec-
tion or other authority.’’.
†
155
HR 976 EAS
(B) 
CONFORMING
AMENDMENT.—Section
102(b) of the Employee Retirement Income Secu-
rity Act of 1974 (29 U.S.C. 1022(b)) is
amended—
(i) by striking ‘‘and the remedies’’ and
inserting ‘‘, the remedies’’; and
(ii) by inserting before the period the
following: ‘‘, and if the employer so elects
for purposes of complying with section
701(f)(3)(B)(i), the model notice applicable
to the State in which the participants and
beneficiaries reside’’.
(C) WORKING GROUP TO DEVELOP MODEL
COVERAGE COORDINATION DISCLOSURE FORM.—
(i) MEDICAID, CHIP, AND EMPLOYER-
SPONSORED
COVERAGE
COORDINATION
WORKING GROUP.—
(I) IN GENERAL.—Not later than
60 days after the date of enactment of
this Act, the Secretary of Health and
Human Services and the Secretary of
Labor shall jointly establish a Med-
icaid, CHIP, and Employer-Sponsored
Coverage Coordination Working Group
(in this subparagraph referred to as
†
156
HR 976 EAS
the ‘‘Working Group’’). The purpose of
the Working Group shall be to develop
the model coverage coordination disclo-
sure form described in subclause (II)
and to identify the impediments to the
effective coordination of coverage avail-
able to families that include employees
of employers that maintain group
health plans and members who are eli-
gible for medical assistance under title
XIX of the Social Security Act or child
health assistance or other health bene-
fits coverage under title XXI of such
Act.
(II) MODEL COVERAGE COORDINA-
TION DISCLOSURE FORM DESCRIBED.—
The model form described in this sub-
clause is a form for plan administra-
tors of group health plans to complete
for purposes of permitting a State to
determine the availability and cost-ef-
fectiveness of the coverage available
under such plans to employees who
have family members who are eligible
for premium assistance offered under a
†
157
HR 976 EAS
State plan under title XIX or XXI of
such Act and to allow for coordination
of coverage for enrollees of such plans.
Such form shall provide the following
information in addition to such other
information as the Working Group de-
termines appropriate:
(aa) 
A 
determination 
of
whether the employee is eligible
for coverage under the group
health plan.
(bb) The name and contract
information of the plan adminis-
trator of the group health plan.
(cc) 
The 
benefits 
offered
under the plan.
(dd) The premiums and cost-
sharing required under the plan.
(ee) Any other information
relevant to coverage under the
plan.
(ii) 
MEMBERSHIP.—The 
Working
Group shall consist of not more than 30
members and shall be composed of rep-
resentatives of—
†
158
HR 976 EAS
(I) the Department of Labor;
(II) the Department of Health
and Human Services;
(III) State directors of the Med-
icaid program under title XIX of the
Social Security Act;
(IV) State directors of the State
Children’s Health Insurance Program
under title XXI of the Social Security
Act;
(V) employers, including owners
of small businesses and their trade or
industry representatives and certified
human resource and payroll profes-
sionals;
(VI) plan administrators and
plan sponsors of group health plans (as
defined in section 607(1) of the Em-
ployee Retirement Income Security Act
of 1974);
(VII) health insurance issuers;
and
(VIII) children and other bene-
ficiaries of medical assistance under
title XIX of the Social Security Act or
†
159
HR 976 EAS
child health assistance or other health
benefits coverage under title XXI of
such Act.
(iii) COMPENSATION.—The members of
the Working Group shall serve without com-
pensation.
(iv) 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 Depart-
ment, with or without reimbursement, as
jointly determined by such Departments.
(v) REPORT.—
(I) REPORT BY WORKING GROUP
TO THE SECRETARIES.—Not later than
18 months after the date of the enact-
ment of this Act, the Working Group
shall submit to the Secretary of Labor
and the Secretary of Health and
Human Services the model form de-
scribed in clause (i)(II) along with a
report containing recommendations for
†
160
HR 976 EAS
appropriate measures to address the
impediments to the effective coordina-
tion of coverage between group health
plans and the State plans under titles
XIX and XXI of the Social Security
Act.
(II) REPORT BY SECRETARIES TO
THE
CONGRESS.—Not later than 2
months after receipt of the report pur-
suant to subclause (I), the Secretaries
shall jointly submit a report to each
House of the Congress regarding the
recommendations contained in the re-
port under such subclause.
(vi) 
TERMINATION.—The 
Working
Group shall terminate 30 days after the
date of the issuance of its report under
clause (v).
(D) EFFECTIVE DATES.—The Secretary of
Labor and the Secretary of Health and Human
Services shall develop the initial model notices
under section 701(f)(3)(B)(i)(II) of the Employee
Retirement Income Security Act of 1974, and the
Secretary of Labor shall provide such notices to
employers, not later than the date that is 1 year
†
161
HR 976 EAS
after the date of enactment of this Act, and each
employer shall provide the initial annual notices
to such employer’s employees beginning with the
first plan year that begins after the date on
which such initial model notices are first issued.
The model coverage coordination disclosure form
developed under subparagraph (C) shall apply
with respect to requests made by States begin-
ning with the first plan year that begins after
the date on which such model coverage coordina-
tion disclosure form is first issued.
(E) ENFORCEMENT.—Section 502 of the
Employee Retirement Income Security Act of
1974 (29 U.S.C. 1132) is amended—
(i) in subsection (a)(6), by striking ‘‘or
(8)’’ and inserting ‘‘(8), or (9)’’; and
(ii) in subsection (c), by redesignating
paragraph (9) as paragraph (10), and by
inserting after paragraph (8) the following:
‘‘(9)(A) The Secretary may assess a civil penalty
against any employer of up to $100 a day from the date
of the employer’s failure to meet the notice requirement of
section 701(f)(3)(B)(i)(I). For purposes of this subpara-
graph, each violation with respect to any single employee
shall be treated as a separate violation.
†
162
HR 976 EAS
‘‘(B) The Secretary may assess a civil penalty against
any plan administrator of up to $100 a day from the date
of the plan administrator’s failure to timely provide to any
State the information required to be disclosed under section
701(f)(3)(B)(ii). For purposes of this subparagraph, each
violation with respect to any single participant or bene-
ficiary shall be treated as a separate violation.’’.
(2) AMENDMENTS TO PUBLIC HEALTH SERVICE
ACT.—Section 2701(f) of the Public Health Service
Act (42 U.S.C. 300gg(f)) is amended by adding at the
end the following new paragraph:
‘‘(3) SPECIAL RULES FOR APPLICATION IN CASE
OF MEDICAID AND CHIP.—
‘‘(A) IN GENERAL.—A group health plan,
and a health insurance issuer offering group
health insurance coverage in connection with a
group health plan, shall permit an employee who
is eligible, but not enrolled, for coverage under
the terms of the plan (or a dependent of such an
employee if the dependent is eligible, but not en-
rolled, for coverage under such terms) to enroll
for coverage under the terms of the plan if either
of the following conditions is met:
‘‘(i) TERMINATION
OF
MEDICAID
OR
CHIP COVERAGE.—The employee or depend-
†
163
HR 976 EAS
ent is covered under a Medicaid plan under
title XIX of the Social Security Act or
under a State child health plan under title
XXI of such Act and coverage of the em-
ployee or dependent under such a plan is
terminated as a result of loss of eligibility
for such coverage and the employee requests
coverage under the group health plan (or
health insurance coverage) not later than 60
days after the date of termination of such
coverage.
‘‘(ii) ELIGIBILITY
FOR
EMPLOYMENT
ASSISTANCE UNDER MEDICAID OR CHIP.—
The employee or dependent becomes eligible
for assistance, with respect to coverage
under the group health plan or health in-
surance coverage, under such Medicaid plan
or State child health plan (including under
any waiver or demonstration project con-
ducted under or in relation to such a plan),
if the employee requests coverage under the
group health plan or health insurance cov-
erage not later than 60 days after the date
the employee or dependent is determined to
be eligible for such assistance.
†
164
HR 976 EAS
‘‘(B) COORDINATION WITH MEDICAID AND
CHIP.—
‘‘(i) OUTREACH
TO
EMPLOYEES
RE-
GARDING AVAILABILITY OF MEDICAID AND
CHIP COVERAGE.—
‘‘(I) IN
GENERAL.—Each em-
ployer that maintains a group health
plan in a State that provides medical
assistance under a State Medicaid
plan under title XIX of the Social Se-
curity Act, or child health assistance
under a State child health plan under
title XXI of such Act, in the form of
premium assistance for the purchase of
coverage under a group health plan,
shall provide to each employee a writ-
ten notice informing the employee of
potential opportunities then currently
available in the State in which the em-
ployee resides for premium assistance
under such plans for health coverage of
the employee or the employee’s depend-
ents. For purposes of compliance with
this subclause, the employer may use
any State-specific model notice devel-
†
165
HR 976 EAS
oped 
in 
accordance 
with 
section
701(f)(3)(B)(i)(II) of the Employee Re-
tirement Income Security Act of 1974
(29 U.S.C. 1181(f)(3)(B)(i)(II)).
‘‘(II) OPTION
TO
PROVIDE
CON-
CURRENT
WITH
PROVISION
OF
SUM-
MARY
PLAN
DESCRIPTION.—An em-
ployer may provide the model notice
applicable to the State in which an
employee resides concurrent with the
furnishing of the summary plan de-
scription as provided in section 104(b)
of the Employee Retirement Income
Security Act of 1974.
‘‘(ii) 
DISCLOSURE
ABOUT
GROUP
HEALTH
PLAN
BENEFITS
TO
STATES
FOR
MEDICAID
AND
CHIP
ELIGIBLE
INDIVID-
UALS.—In the case of an enrollee in a
group health plan who is covered under a
Medicaid plan of a State under title XIX of
the Social Security Act or under a State
child health plan under title XXI of such
Act, the plan administrator of the group
health plan shall disclose to the State, upon
request, information about the benefits
†
166
HR 976 EAS
available under the group health plan in
sufficient specificity, as determined under
regulations of the Secretary of Health and
Human Services in consultation with the
Secretary that require use of the model cov-
erage coordination disclosure form developed
under section 411(b)(1)(C) of the Children’s
Health Insurance Reauthorization Act of
2007, so as to permit the State to make a
determination (under paragraph (2)(B),
(3), or (10) of section 2105(c) of the Social
Security Act or otherwise) concerning the
cost-effectiveness of the State providing med-
ical or child health assistance through pre-
mium assistance for the purchase of cov-
erage under such group health plan and in
order for the State to provide supplemental
benefits required under paragraph (10)(E)
of such section or other authority.’’.
†
167
HR 976 EAS
TITLE 
V—STRENGTHENING
QUALITY 
OF 
CARE 
AND
HEALTH OUTCOMES OF CHIL-
DREN
SEC. 501. CHILD HEALTH QUALITY IMPROVEMENT ACTIVI-
TIES FOR CHILDREN ENROLLED IN MEDICAID
OR CHIP.
(a) DEVELOPMENT
OF
CHILD
HEALTH
QUALITY
MEASURES FOR CHILDREN ENROLLED IN MEDICAID OR
CHIP.—Title XI (42 U.S.C. 1301 et seq.) is amended by
inserting after section 1139 the following new section:
‘‘SEC. 1139A. CHILD HEALTH QUALITY MEASURES.
‘‘(a) DEVELOPMENT OF AN INITIAL CORE SET OF
HEALTH CARE QUALITY MEASURES FOR CHILDREN EN-
ROLLED IN MEDICAID OR CHIP.—
‘‘(1) IN GENERAL.—Not later than January 1,
2009, the Secretary shall identify and publish for gen-
eral comment an initial, recommended core set of
child health quality measures for use by State pro-
grams administered under titles XIX and XXI, health
insurance issuers and managed care entities that
enter into contracts with such programs, and pro-
viders of items and services under such programs.
‘‘(2) IDENTIFICATION
OF
INITIAL
CORE
MEAS-
URES.—In consultation with the individuals and en-
†
184
HR 976 EAS
‘‘(iii) training health professionals on
how to identify and treat obese and over-
weight individuals which may include nu-
trition and physical activity counseling;
and
‘‘(iv) providing community education
by a health professional on good nutrition
and physical activity to develop a better un-
derstanding of the relationship between diet,
physical activity, and eating disorders, obe-
sity, or being overweight; and
‘‘(D) provide, through qualified health pro-
fessionals, training and supervision for commu-
nity health workers to—
‘‘(i) educate families regarding the re-
lationship between nutrition, eating habits,
physical activity, and obesity;
‘‘(ii) educate families about effective
strategies to improve nutrition, establish
healthy eating patterns, and establish ap-
propriate levels of physical activity; and
‘‘(iii) educate and guide parents re-
garding the ability to model and commu-
nicate positive health behaviors.
†
200
HR 976 EAS
SEC. 602. PAYMENT ERROR RATE MEASUREMENT (‘‘PERM’’).
(a) EXPENDITURES RELATED TO COMPLIANCE WITH
REQUIREMENTS.—
(1) ENHANCED PAYMENTS.—Section 2105(c) (42
U.S.C. 1397ee(c)), as amended by section 401(a), is
amended by adding at the end the following new
paragraph:
‘‘(11) ENHANCED
PAYMENTS.—Notwithstanding
subsection (b), the enhanced FMAP with respect to
payments under subsection (a) for expenditures re-
lated to the administration of the payment error rate
measurement (PERM) requirements applicable to the
State child health plan in accordance with the Im-
proper Payments Information Act of 2002 and parts
431 and 457 of title 42, Code of Federal Regulations
(or any related or successor guidance or regulations)
shall in no event be less than 90 percent.’’.
(2) EXCLUSION OF FROM CAP ON ADMINISTRA-
TIVE
EXPENDITURES.—Section 2105(c)(2)(C) (42
U.S.C. 1397ee(c)(2)C)), as amended by section 402(b),
is amended by adding at the end the following:
‘‘(v) PAYMENT ERROR RATE MEASURE-
MENT
(PERM)
EXPENDITURES.—Expendi-
tures related to the administration of the
payment error rate measurement (PERM)
requirements applicable to the State child