110 HR 3269 IH: Children's Health Insurance Program

U.S. House of Representatives
2007-07-31
text/xml
EN
Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

		 I
		110th CONGRESS
		1st Session
		H. R. 3269
		IN THE HOUSE OF REPRESENTATIVES

			July 31, 2007
			Mrs. Wilson of New
			 Mexico (for herself, Mr.
			 Gillmor, Mr. Regula,
			 Mr. Gerlach,
			 Mrs. Bono, and
			 Mr. English of Pennsylvania)
			 introduced the following bill; which was referred to the
			 Committee on Energy and
			 Commerce, and in addition to the Committees on
			 Ways and Means and
			 Education and Labor, for
			 a period to be subsequently determined by the Speaker, in each case for
			 consideration of such provisions as fall within the jurisdiction of the
			 committee concerned

		A BILL
		To amend title XXI of the Social Security Act to
		  reauthorize the State Children’s Health Insurance Program, and for other
		  purposes.

		1.Short title; amendments to
			 Social Security Act; references; table of contents
			(a)Short
			 titleThis Act may be cited
			 as the Children's Health Insurance
			 Program Reauthorization Act of 2007.
			(b)Amendments to
			 social security actExcept as otherwise specifically provided,
			 whenever in this Act an amendment is expressed in terms of an amendment to or
			 repeal of a section or other provision, the reference shall be considered to be
			 made to that section or other provision of the Social Security Act.
			(c)References to
			 Medicaid; CHIP; SecretaryIn this Act:
				(1)CHIPThe
			 term CHIP means the State Children's Health Insurance Program
			 established under title XXI of the Social Security Act (42 U.S.C. 1397aa et
			 seq.).
				(2)MedicaidThe
			 term Medicaid means the program for medical assistance established
			 under title XIX of the Social Security Act (42 U.S.C. 1396 et seq.).
				(3)SecretaryThe
			 term Secretary means the Secretary of Health and Human
			 Services.
				(d)Table of
			 contentsThe table of contents for this Act is as follows:

					Sec. 1. Short title; amendments to Social
				Security Act; references; table of contents.
					TITLE I—Financing of CHIP
					Sec. 101. Extension of CHIP.
					Sec. 102. Allotments for the 50 States and
				the District of Columbia.
					Sec. 103. One-time
				appropriation.
					Sec. 104. Improving funding for the
				territories under CHIP and Medicaid.
					Sec. 105. Incentive bonuses for
				States.
					Sec. 106. Phase-out of coverage for
				nonpregnant childless adults under CHIP; conditions for coverage of
				parents.
					Sec. 107. State option to cover low-income pregnant women under
				CHIP through a State plan amendment.
					Sec. 108. CHIP Contingency fund.
					Sec. 109. Two-year availability of allotments; expenditures
				counted against oldest allotments.
					Sec. 110. Limitation on matching rate for States that propose
				to cover children with effective family income that exceeds 300 percent of the
				poverty line.
					Sec. 111. Option for qualifying States to receive the enhanced
				portion of the CHIP matching rate for Medicaid coverage of certain
				children.
					TITLE II—Outreach and Enrollment
					Sec. 201. Grants for outreach and enrollment.
					Sec. 202. Increased outreach and enrollment of
				Indians.
					Sec. 203. Demonstration project to permit
				States to rely on findings by an Express Lane agency to determine components of
				a child’s eligibility for Medicaid or CHIP.
					Sec. 204. Authorization of certain information disclosures to
				simplify health coverage determinations.
					TITLE III—Reducing Barriers to Enrollment
					Sec. 301. Verification of declaration of citizenship or
				nationality for purposes of eligibility for Medicaid and CHIP.
					Sec. 302. Reducing administrative barriers to
				enrollment.
					TITLE IV—Reducing Barriers to Providing Premium
				Assistance
					Subtitle A—Additional State option for providing premium
				assistance
					Sec. 401. Additional State option for providing premium
				assistance.
					Sec. 402. Outreach, education, and enrollment
				assistance.
					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 eligibility for assistance
				in purchase of employment-based coverage; coordination of coverage.
					TITLE V—Strengthening Quality of Care and Health Outcomes of
				Children
					Sec. 501. Child health quality improvement activities for
				children enrolled in Medicaid or CHIP.
					Sec. 502. Improved information regarding access to coverage
				under CHIP.
					Sec. 503. Application of certain managed care quality
				safeguards to CHIP.
					TITLE VI—Miscellaneous
					Sec. 601. Technical correction regarding current State
				authority under Medicaid.
					Sec. 602. Payment error rate measurement
				(PERM).
					Sec. 603. Elimination of counting medicaid child presumptive
				eligibility costs against title XXI allotment.
					Sec. 604. Improving data
				collection.
					Sec. 605. Deficit Reduction Act technical
				corrections.
					Sec. 606. Elimination of confusing program
				references.
					Sec. 607. Mental health parity in CHIP plans.
					Sec. 608. Dental health grants.
					Sec. 609. Application of prospective payment system for
				services provided by Federally-qualified health centers and rural health
				clinics.
					TITLE VII—Revenue Provisions
					Sec. 701. Increase in excise tax rate on
				tobacco products.
					Sec. 702. Administrative improvements.
					Sec. 703. Time for payment of corporate estimated
				taxes.
					TITLE VIII—Effective date
					Sec. 801. Effective date.

			IFinancing of
			 CHIP
			101.Extension of
			 CHIPSection 2104(a) (42
			 U.S.C. 1397dd(a)) is amended—
				(1)in paragraph (9),
			 by striking and at the end;
				(2)in paragraph (10),
			 by striking the period at the end and inserting a semicolon; and
				(3)by adding at the
			 end the following new paragraphs:

						(11)for fiscal year
				2008, $9,125,000,000;
						(12)for fiscal year
				2009, $10,675,000,000;
						(13)for fiscal year
				2010, $11,850,000,000;
						(14)for fiscal year
				2011, $13,750,000,000; and
						(15)for fiscal year
				2012, for purposes of making 2 semi-annual allotments—
							(A)$1,750,000,000 for
				the period beginning on October 1, 2011, and ending on March 31, 2012,
				and
							(B)$1,750,000,000 for
				the period beginning on April 1, 2012, and ending on September 30,
				2012.
							.
				102.Allotments for the
			 50 States and the District of Columbia
				(a)In
			 generalSection 2104 (42
			 U.S.C. 1397dd) is amended by adding at the end the following new
			 subsection:

						(i)Determination of
				allotments for the 50 states and the district of columbia for fiscal years 2008
				through 2012
							(1)Computation of
				allotment
								(A)In
				generalSubject to the succeeding paragraphs of this subsection,
				the Secretary shall for each of fiscal years 2008 through 2012 allot to each
				subsection (b) State from the available national allotment an amount equal to
				110 percent of—
									(i)in
				the case of fiscal year 2008, the highest of the amounts determined under
				paragraph (2);
									(ii)in the case of
				each of fiscal years 2009 through 2011, the Federal share of the expenditures
				determined under subparagraph (B) for the fiscal year; and
									(iii)beginning with
				fiscal year 2012, subject to subparagraph (E), each semi-annual allotment
				determined under subparagraph (D).
									(B)Projected state
				expenditures for the fiscal yearFor purposes of subparagraphs
				(A)(ii) and (D), the expenditures determined under this subparagraph for a
				fiscal year are the projected expenditures under the State child health plan
				for the fiscal year (as certified by the State and submitted to the Secretary
				by not later than August 31 of the preceding fiscal year).
								(C)Available
				national allotmentFor purposes of this subsection, the term
				available national allotment means, with respect to any fiscal
				year, the amount available for allotment under subsection (a) for the fiscal
				year, reduced by the amount of the allotments made for the fiscal year under
				subsection (c). Subject to paragraph (3)(B), the available national allotment
				with respect to the amount available under subsection (a)(15)(A) for fiscal
				year 2012 shall be increased by the amount of the appropriation for the period
				beginning on October 1 and ending on March 31 of such fiscal year under section
				103 of the Children's Health Insurance
				Program Reauthorization Act of 2007.
								(D)Semi-annual
				allotmentsFor purposes of subparagraph (A)(iii), the semi-annual
				allotments determined under this paragraph with respect to a fiscal year are as
				follows:
									(i)For the period
				beginning on October 1 and ending on March 31 of the fiscal year, the Federal
				share of the portion of the expenditures determined under subparagraph (B) for
				the fiscal year which are allocable to such period.
									(ii)For the period
				beginning on April 1 and ending on September 30 of the fiscal year, the Federal
				share of the portion of the expenditures determined under subparagraph (B) for
				the fiscal year which are allocable to such period.
									(E)AvailabilityEach
				semi-annual allotment made under subparagraph (A)(iii) shall remain available
				for expenditure under this title for periods after the period specified in
				subparagraph (D) for purposes of determining the allotment in the same manner
				as the allotment would have been available for expenditure if made for an
				entire fiscal year.
								(2)Special rule for
				fiscal year 2008
								(A)In
				generalFor purposes of paragraph (1)(A)(i), the amounts
				determined under this paragraph for fiscal year 2008 are as follows:
									(i)The
				total Federal payments to the State under this title for fiscal year 2007,
				multiplied by the annual adjustment determined under subparagraph (B) for
				fiscal year 2008.
									(ii)The Federal share
				of the amount allotted to the State for fiscal year 2007 under subsection (b),
				multiplied by the annual adjustment determined under subparagraph (B) for
				fiscal year 2008.
									(iii)Only in the case of—
										(I)a State that received a payment,
				redistribution, or allotment under any of paragraphs (1), (2), or (4) of
				subsection (h), the amount of the projected total Federal payments to the State
				under this title for fiscal year 2007, as determined on the basis of the
				November 2006 estimates certified by the State to the Secretary;
										(II)a State whose projected total Federal
				payments to the State under this title for fiscal year 2007, as determined on
				the basis of the May 2006 estimates certified by the State to the Secretary,
				were at least $95,000,000 but not more than $96,000,000 higher than the
				projected total Federal payments to the State under this title for fiscal year
				2007 on the basis of the November 2006 estimates, the amount of the projected
				total Federal payments to the State under this title for fiscal year 2007 on
				the basis of the May 2006 estimates; or
										(III)a State whose
				projected total Federal payments under this title for fiscal year 2007, as
				determined on the basis of the November 2006 estimates certified by the State
				to the Secretary, exceeded all amounts available to the State for expenditure
				for fiscal year 2007 (including any amounts paid, allotted, or redistributed to
				the State in prior fiscal years), the amount of the projected total Federal
				payments to the State under this title for fiscal year 2007, as determined on
				the basis of the November 2006 estimates certified by the State to the
				Secretary,
										multiplied by
				the annual adjustment determined under subparagraph (B) for fiscal year
				2008.(iv)The projected
				total Federal payments to the State under this title for fiscal year 2008, as
				determined on the basis of the August 2007 projections certified by the State
				to the Secretary by not later than September 30, 2007.
									(B)Annual
				adjustment for health care cost growth and child population
				growthThe annual adjustment determined under this subparagraph
				for a fiscal year with respect to a State is equal to the product of the
				amounts determined under clauses (i) and (ii):
									(i)Per capita health
				care growth1 plus the percentage increase (if any) in the
				projected nominal per capita amount of National Health Expenditures for the
				calendar year that begins during the fiscal year involved over the preceding
				calendar year, as most recently published by the Secretary.
									(ii)Child
				population growth1.01 plus the percentage change in the
				population of children under 19 years of age in the State from July 1 of the
				fiscal year preceding the fiscal year involved to July 1 of the fiscal year
				involved, as determined by the Secretary based on the most timely and accurate
				published estimates of the Bureau of the Census.
									(C)DefinitionFor
				purposes of subparagraph (B), the term fiscal year involved means
				the fiscal year for which an allotment under this subsection is being
				determined.
								(D)Proration
				ruleIf, after the application of this paragraph without regard
				to this subparagraph, the sum of the State allotments determined under this
				paragraph for fiscal year 2008 exceeds the available national allotment for
				fiscal year 2008, the Secretary shall reduce each such allotment on a
				proportional basis.
								(3)Alternative
				allotments for fiscal years 2009 through 2012
								(A)In
				generalIf the sum of the State allotments determined under
				paragraph (1)(A)(ii) for any of fiscal years 2009 through 2011 exceeds the
				available national allotment for the fiscal year, the Secretary shall allot to
				each subsection (b) State from the available national allotment for the fiscal
				year an amount equal to the product of—
									(i)the available
				national allotment for the fiscal year; and
									(ii)the percentage
				equal to the sum of the State allotment factors for the fiscal year determined
				under paragraph (4) with respect to the State.
									(B)Special rules
				beginning in fiscal year 2012Beginning in fiscal year
				2012—
									(i)this paragraph
				shall be applied separately with respect to each of the periods described in
				clauses (i) and (ii) of paragraph (1)(D) and the available national allotment
				for each such period shall be the amount appropriated for such period (rather
				than the amount appropriated for the entire fiscal year), reduced by the amount
				of the allotments made for the fiscal year under subsection (c) for each such
				period, and
									(ii)if—
										(I)the sum of the
				State allotments determined under paragraph (1)(A)(iii) for either such period
				exceeds the amount of such available national allotment for such period, the
				Secretary shall make the allotment for each State for such period in the same
				manner as under subparagraph (A), and
										(II)the amount of
				such available national allotment for either such period exceeds the sum of the
				State allotments determined under paragraph (1)(A)(iii) for such period, the
				Secretary shall increase the allotment for each State for such period by the
				amount that bears the same ratio to such excess as the State's allotment
				determined under paragraph (1)(A)(iii) for such period (without regard to this
				subparagraph) bears to the sum of such allotments for all States.
										(4)Weighted
				factors
								(A)Factors
				describedFor purposes of paragraph (3), the factors described in
				this subparagraph are the following:
									(i)Projected state
				expenditures for the fiscal yearThe ratio of the projected
				expenditures under the State child health plan for the fiscal year (as
				certified by the State to the Secretary by not later than August 31 of the
				preceding fiscal year) to the sum of the projected expenditures under all such
				plans for all subsection (b) States for the fiscal year, multiplied by the
				applicable percentage weight assigned under subparagraph (B).
									(ii)Number of
				low-income children in the StateThe ratio of the number of
				low-income children in the State, as determined on the basis of the most timely
				and accurate published estimates of the Bureau of the Census, to the sum of the
				number of low-income children so determined for all subsection (b) States for
				such fiscal year, multiplied by the applicable percentage weight assigned under
				subparagraph (B).
									(iii)Projected
				state expenditures for the preceding fiscal yearThe ratio of the
				projected expenditures under the State child health plan for the preceding
				fiscal year (as determined on the basis of the projections certified by the
				State to the Secretary for November of the fiscal year), to the sum of the
				projected expenditures under all such plans for all subsection (b) States for
				such preceding fiscal year (as so determined), multiplied by the applicable
				percentage weight assigned under subparagraph (B).
									(iv)Actual state
				expenditures for the second preceding fiscal yearThe ratio of
				the actual expenditures under the State child health plan for the second
				preceding fiscal year, as determined by the Secretary on the basis of
				expenditure data reported by States on CMS Form 64 or CMS Form 21, to such sum
				of the actual expenditures under all such plans for all subsection (b) States
				for such second preceding fiscal year, multiplied by the applicable percentage
				weight assigned under subparagraph (B).
									(B)Assignment of
				weightsFor each of fiscal years 2009 through 2012, the
				applicable weights assigned under this subparagraph are the following:
									(i)With respect to
				the factor described in subparagraph (A)(i), a weight of 75 percent for each
				such fiscal year.
									(ii)With respect to
				the factor described in subparagraph (A)(ii), a weight of 12½ percent for each
				such fiscal year.
									(iii)With respect to
				the factor described in subparagraph (A)(iii), a weight of 7½ percent for each
				such fiscal year.
									(iv)With respect to
				the factor described in subparagraph (A)(iv), a weight of 5 percent for each
				such fiscal year.
									(5)Demonstration of
				need for increased allotment based on projected state expenditures exceeding 10
				percent of the preceding fiscal year allotment
								(A)In
				generalIf the projected expenditures under the State child
				health plan described in paragraph (1)(B) for any of fiscal years 2009 through
				2012 are at least 10 percent more than the allotment determined for the State
				for the preceding fiscal year (determined without regard to paragraph (2)(D) or
				paragraph (3)), and, during the preceding fiscal year, the State did not
				receive approval for a State plan amendment or waiver to expand coverage under
				the State child health plan or did not receive a CHIP contingency fund payment
				under subsection (k)—
									(i)the State shall
				submit to the Secretary, by not later than August 31 of the preceding fiscal
				year, information relating to the factors that contributed to the need for the
				increase in the State's allotment for the fiscal year, as well as any other
				additional information that the Secretary may require for the State to
				demonstrate the need for the increase in the State's allotment for the fiscal
				year;
									(ii)the Secretary
				shall—
										(I)review the
				information submitted under clause (i);
										(II)notify the State
				in writing within 60 days after receipt of the information that—
											(aa)the
				projected expenditures under the State child health plan are approved or
				disapproved (and if disapproved, the reasons for disapproval); or
											(bb)specified
				additional information is needed; and
											(III)if the Secretary
				disapproved the projected expenditures or determined additional information is
				needed, provide the State with a reasonable opportunity to submit additional
				information to demonstrate the need for the increase in the State's allotment
				for the fiscal year.
										(B)Provisional and
				final allotmentIn the case of a State described in subparagraph
				(A) for which the Secretary has not determined by September 30 of a fiscal year
				whether the State has demonstrated the need for the increase in the State's
				allotment for the succeeding fiscal year, the Secretary shall provide the State
				with a provisional allotment for the fiscal year equal to 110 percent of the
				allotment determined for the State under this subsection for the preceding
				fiscal year (determined without regard to paragraph (2)(D) or paragraph (3)),
				and may, not later than November 30 of the fiscal year, adjust the State's
				allotment (and the allotments of other subsection (b) States), as necessary
				(and, if applicable, subject to paragraph (3)), on the basis of information
				submitted by the State in accordance with subparagraph (A).
								(6)Special
				rules
								(A)Deadline and
				data for determining fiscal year 2008 allotmentsIn computing the
				amounts under paragraph (2)(A) and subsection (c)(5)(A) that determine the
				allotments to subsection (b) States and territories for fiscal year 2008, the
				Secretary shall use the most recent data available to the Secretary before the
				start of that fiscal year. The Secretary may adjust such amounts and
				allotments, as necessary, on the basis of the expenditure data for the prior
				year reported by States on CMS Form 64 or CMS Form 21 not later than November
				30, 2007, but in no case shall the Secretary adjust the allotments provided
				under paragraph (2)(A) or subsection (c)(5)(A) for fiscal year 2008 after
				December 31, 2007.
								(B)Inclusion of
				certain expenditures
									(i)Projected
				expenditures of qualifying statesPayments made or projected to
				be made to a qualifying State described in paragraph (2) of section 2105(g) for
				expenditures described in paragraph (1)(B)(ii) or (4)(B) of that section shall
				be included for purposes of determining the projected expenditures described in
				paragraph (1)(B) with respect to the allotments determined for each of fiscal
				years 2009 through 2012 and for purposes of determining the amounts described
				in clauses (i) and (iv) of paragraph (2)(A) with respect to the allotments
				determined for fiscal year 2008.
									(ii)Projected
				expenditures under block grant set-asides for nonpregnant childless adults and
				parentsPayments projected to be made to a State under subsection
				(a) or (b) of section 2111 shall be included for purposes of determining the
				projected expenditures described in paragraph (1)(B) with respect to the
				allotments determined for each of fiscal years 2009 through 2012 (to the extent
				such payments are permitted under such section), including for purposes of
				allocating such expenditures for purposes of clauses (i) and (ii) of paragraph
				(1)(D).
									(7)Subsection
				(b) StateIn this paragraph, the term
				subsection (b) State means 1 of the 50 States or the District of
				Columbia.
							.
				(b)Conforming
			 amendmentsSection 2104 (42 U.S.C. 1397dd) is amended—
					(1)in
			 subsection (a), by striking subsection (d) and inserting
			 subsections (d), (h), and (i);
					(2)in subsection
			 (b)(1), by striking subsection (d) and inserting
			 subsections (d), (h), and (i); and
					(3)in subsection
			 (c)(1), by striking subsection (d) and inserting
			 subsections (d), (h), and (i).
					103.One-time
			 appropriationThere is
			 appropriated to the Secretary, out of any money in the Treasury not otherwise
			 appropriated, $12,500,000,000 to accompany the allotment made for the period
			 beginning on October 1, 2011, and ending on March 31, 2012, under section
			 2104(a)(15)(A) of the Social Security Act (42 U.S.C. 1397dd(a)(15)(A)) (as
			 added by section 101), to remain available until expended. Such amount shall be
			 used to provide allotments to States under subsections (c)(5) and (i) of
			 section 2104 of the Social Security Act (42 U.S.C. 1397dd) for the first 6
			 months of fiscal year 2012 in the same manner as allotments are provided under
			 subsection (a)(15)(A) of such section and subject to the same terms and
			 conditions as apply to the allotments provided from such subsection
			 (a)(15)(A).
			104.Improving
			 funding for the territories under CHIP and Medicaid
				(a)Update of CHIP
			 allotmentsSection 2104(c) (42 U.S.C. 1397dd(c)) is
			 amended—
					(1)in paragraph (1),
			 by inserting and paragraphs (5) and (6) after and
			 (i); and
					(2)by adding at the
			 end the following new paragraphs:

							(5)Annual allotments
				for territories beginning with fiscal year 2008Of the total
				allotment amount appropriated under subsection (a) for a fiscal year beginning
				with fiscal year 2008, the Secretary shall allot to each of the commonwealths
				and territories described in paragraph (3) the following:
								(A)Fiscal year
				2008For fiscal year 2008, the highest amount of Federal payments
				to the commonwealth or territory under this title for any fiscal year occurring
				during the period of fiscal years 1998 through 2007, multiplied by the annual
				adjustment determined under subsection (i)(2)(B) for fiscal year 2008, except
				that clause (ii) thereof shall be applied by substituting the United
				States for the State.
								(B)Fiscal years
				2009 through 2012
									(i)In
				generalFor each of fiscal years 2009 through 2012, except as
				provided in clause (ii), the amount determined under this paragraph for the
				preceding fiscal year multiplied by the annual adjustment determined under
				subsection (i)(2)(B) for the fiscal year, except that clause (ii) thereof shall
				be applied by substituting the United States for the
				State.
									(ii)Special rule
				for fiscal year 2012In the case of fiscal year 2012—
										(I)89 percent of the
				amount allocated to the commonwealth or territory for such fiscal year (without
				regard to this subclause) shall be allocated for the period beginning on
				October 1, 2011, and ending on March 31, 2012, and
										(II)11 percent of
				such amount shall be allocated for the period beginning on April 1, 2012, and
				ending on September 30,
				2012.
										.
					(b)Removal of
			 federal matching payments for data reporting systems from the overall limit on
			 payments to territories under title XIXSection 1108(g) (42
			 U.S.C. 1308(g)) is amended by adding at the end the following new
			 paragraph:

						(4)Exclusion of
				certain expenditures from payment limitsWith respect to fiscal
				years beginning with fiscal year 2008, if Puerto Rico, the Virgin Islands,
				Guam, the Northern Mariana Islands, or American Samoa qualify for a payment
				under subparagraph (A)(i), (B), or (F) of section 1903(a)(3) for a calendar
				quarter of such fiscal year, the payment shall not be taken into account in
				applying subsection (f) (as increased in accordance with paragraphs (1), (2),
				and (3) of this subsection) to such commonwealth or territory for such fiscal
				year.
						.
				(c)GAO study and
			 reportNot later than September 30, 2009, the Comptroller General
			 of the United States shall submit a report to the appropriate committees of
			 Congress regarding Federal funding under Medicaid and CHIP for Puerto Rico, the
			 United States Virgin Islands, Guam, American Samoa, and the Northern Mariana
			 Islands. The report shall include the following:
					(1)An analysis of all
			 relevant factors with respect to—
						(A)eligible Medicaid
			 and CHIP populations in such commonwealths and territories;
						(B)historical and
			 projected spending needs of such commonwealths and territories and the ability
			 of capped funding streams to respond to those spending needs;
						(C)the extent to
			 which Federal poverty guidelines are used by such commonwealths and territories
			 to determine Medicaid and CHIP eligibility; and
						(D)the extent to
			 which such commonwealths and territories participate in data collection and
			 reporting related to Medicaid and CHIP, including an analysis of territory
			 participation in the Current Population Survey versus the American Community
			 Survey.
						(2)Recommendations
			 for improving Federal funding under Medicaid and CHIP for such commonwealths
			 and territories.
					105.Incentive
			 bonuses for States
				(a)In
			 generalSection 2104 (42
			 U.S.C. 1397dd), as amended by section 102, is amended by adding at the end the
			 following new subsection:

						(j)Incentive
				bonuses
							(1)Establishment of
				incentive pool from unobligated national allotment and unexpended state
				allotments
								(A)In
				generalThere is hereby established in the Treasury of the United
				States a fund which shall be known as the CHIP Incentive Bonuses
				Pool (in this subsection referred to as the Incentive
				Pool). Amounts in the Incentive Pool are authorized to be appropriated
				for payments under this subsection and shall remain available until
				expended.
								(B)Deposits through
				initial appropriation and transfers of funds
									(i)Initial
				appropriationThere is appropriated to the Incentive Pool, out of
				any money in the Treasury not otherwise appropriated, $3,000,000,000 for fiscal
				year 2008.
									(ii)TransfersNotwithstanding
				any other provision of law, the following amounts are hereby appropriated or
				transferred to, deposited in, and made available for expenditure from the
				Incentive Pool on the following dates:
										(I)Unexpended
				fiscal year 2006 and 2007 allotmentsOn December 31, 2007, the
				sum for all States of the excess (if any) for each State of—
											(aa)the
				aggregate allotments provided for the State under subsection (b) or (c) for
				fiscal years 2006 and 2007 that are not expended by September 30, 2007,
				over
											(bb)an
				amount equal to 50 percent of the allotment provided for the State under
				subsection (c) or (i) for fiscal year 2008 (as determined in accordance with
				subsection (i)(6)).
											(II)Unobligated
				national allotment
											(aa)Fiscal years
				2008 through 2011On December 31 of fiscal year 2008, and on
				December 31 of each succeeding fiscal year through fiscal year 2011, the
				portion, if any, of the amount appropriated under subsection (a) for such
				fiscal year that is unobligated for allotment to a State under subsection (c)
				or (i) for such fiscal year or set aside under subsection (a)(3) or (b)(2) of
				section 2111 for such fiscal year.
											(bb)First half of
				fiscal year 2012On December 31 of fiscal year 2012, the portion,
				if any, of the sum of the amounts appropriated under subsection (a)(15)(A) and
				under section 103 of the Children's Health
				Insurance Program Reauthorization Act of 2007 for the period
				beginning on October 1, 2011, and ending on March 31, 2012, that is unobligated
				for allotment to a State under subsection (c) or (i) for such fiscal year or
				set aside under subsection (b)(2) of section 2111 for such fiscal year.
											(cc)Second half of
				fiscal year 2012On June 30 of fiscal year 2012, the portion, if
				any, of the amount appropriated under subsection (a)(15)(B) for the period
				beginning on April 1, 2012, and ending on September 30, 2012, that is
				unobligated for allotment to a State under subsection (c) or (i) for such
				fiscal year or set aside under subsection (b)(2) of section 2111 for such
				fiscal year.
											(III)Percentage of
				state allotments that are unexpended by the end of the first year of
				availability beginning with the fiscal year 2009 allotmentsOn
				October 1 of each of fiscal years 2009 through 2012, the sum for all States for
				such fiscal year (the current fiscal year) of the excess (if any)
				for each State of—
											(aa)the
				allotment made for the State under subsection (b), (c), or (i) for the fiscal
				year preceding the current fiscal year (reduced by any amounts set aside under
				section 2111(a)(3)) that is not expended by the end of such preceding fiscal
				year, over
											(bb)an
				amount equal to the applicable percentage (for the fiscal year) of the
				allotment made for the State under subsection (b), (c), or (i) (as so reduced)
				for such preceding fiscal year.
											For
				purposes of item (bb), the applicable percentage is 20 percent for fiscal year
				2009, and 10 percent for each of fiscal years 2010, 2011, and 2012.(IV)Remainder of
				state allotments that are unexpended by the end of the period of availability
				beginning with the fiscal year 2006 allotmentsOn October 1 of
				each of fiscal years 2009 through 2012, the total amount of allotments made to
				States under subsection (b), (c), or (i) for the second preceding fiscal year
				(third preceding fiscal year in the case of the fiscal year 2006 allotments)
				and remaining after the application of subclause (III) that are not expended by
				September 30 of the preceding fiscal year.
										(V)Unexpended
				transitional coverage block grant for nonpregnant childless
				adultsOn October 1, 2009, any amounts set aside under section
				2111(a)(3) that are not expended by September 30, 2009.
										(VI) Excess CHIP
				contingency funds
											(aa)Amounts in
				excess of the aggregate capOn October 1 of each of fiscal years
				2010 through 2012, any amount in excess of the aggregate cap applicable to the
				CHIP Contingency Fund for the fiscal year under subsection (k)(2)(B).
											(bb)Unexpended CHIP
				contingency fund paymentsOn October 1 of each of fiscal years
				2010 through 2012, any portion of a CHIP Contingency Fund payment made to a
				State that remains unexpended at the end of the period for which the payment is
				available for expenditure under subsection (e)(3).
											(VII)Extension of
				availability for portion of unexpended state allotmentsThe
				portion of the allotment made to a State for a fiscal year that is not
				transferred to the Incentive Pool under subclause (I) or (III) shall remain
				available for expenditure by the State only during the fiscal year in which
				such transfer occurs, in accordance with subclause (IV) and subsection
				(e)(4).
										(C)Investment of
				fundThe Secretary of the Treasury shall invest, in interest
				bearing securities of the United States, such currently available portions of
				the Incentive Pool as are not immediately required for payments from the Pool.
				The income derived from these investments constitutes a part of the Incentive
				Pool.
								(2)Payments to
				states increasing enrollment
								(A)In
				generalSubject to paragraph (3)(D), with respect to each of
				fiscal years 2009 through 2012, the Secretary shall make payments to States
				from the Incentive Pool determined under subparagraph (B).
								(B)Determination of
				paymentsIf, for any coverage period ending in a fiscal year
				ending after September 30, 2008, the average monthly enrollment of children in
				the State plan under title XIX exceeds the baseline monthly average for such
				period, the payment made for the fiscal year shall be equal to the applicable
				amount determined under subparagraph (C).
								(C)Applicable
				amountFor purposes of subparagraph (B), the applicable amount is
				the product determined in accordance with the following:
									(i)If
				such excess with respect to the number of individuals who are enrolled in the
				State plan under title XIX does not exceed 2 percent, the product of $75 and
				the number of such individuals included in such excess.
									(ii)If such excess
				with respect to the number of individuals who are enrolled in the State plan
				under title XIX exceeds 2, but does not exceed 5 percent, the product of $300
				and the number of such individuals included in such excess, less the amount of
				such excess calculated in clause (i).
									(iii)If such excess
				with respect to the number of individuals who are enrolled in the State plan
				under title XIX exceeds 5 percent, the product of $625 and the number of such
				individuals included in such excess, less the sum of the amount of such excess
				calculated in clauses (i) and (ii).
									(D)Indexing of
				dollar amountsFor each coverage period ending in a fiscal year
				ending after September 30, 2009, the dollar amounts specified in subparagraph
				(C) shall be increased by the percentage increase (if any) in the projected
				nominal per capita amount of National Health Expenditures for the calendar year
				beginning on January 1 of the coverage period over the preceding coverage
				period, as most recently published by the Secretary before the beginning of the
				coverage period involved.
								(3)Rules relating
				to enrollment increasesFor purposes of paragraph (2)(B)—
								(A)Baseline monthly
				averageExcept as provided in subparagraph (C), the baseline
				monthly average for any fiscal year for a State is equal to—
									(i)the baseline
				monthly average for the preceding fiscal year; multiplied by
									(ii)the sum of 1 plus
				the sum of—
										(I)0.01; and
										(II)the percentage
				increase in the population of low-income children in the State from the
				preceding fiscal year to the fiscal year involved, as determined by the
				Secretary based on the most timely and accurate published estimates of the
				Bureau of the Census before the beginning of the fiscal year involved.
										(B)Coverage
				periodExcept as provided in subparagraph (C), the coverage
				period for any fiscal year consists of the last 2 quarters of the preceding
				fiscal year and the first 2 quarters of the fiscal year.
								(C)Special rules
				for fiscal year 2009With respect to fiscal year 2009—
									(i)the
				coverage period for that fiscal year shall be based on the first 2 quarters of
				fiscal year 2009; and
									(ii)the baseline
				monthly average shall be—
										(I)the average
				monthly enrollment of low-income children enrolled in the State's plan under
				title XIX for the first 2 quarters of fiscal year 2007 (as determined over a
				6-month period on the basis of the most recent information reported through the
				Medicaid Statistical Information System (MSIS)); multiplied by
										(II)the sum of 1 plus
				the sum of—
											(aa)0.02; and
											(bb)the
				percentage increase in the population of low-income children in the State from
				fiscal year 2007 to fiscal year 2009, as determined by the Secretary based on
				the most timely and accurate published estimates of the Bureau of the Census
				before the beginning of the fiscal year involved.
											(D)Additional
				requirement for eligibility for paymentFor purposes of
				subparagraphs (B) and (C), the average monthly enrollment shall be determined
				without regard to children who do not meet the income eligibility criteria in
				effect on July 19, 2007, for enrollment under the State plan under title XIX or
				under a waiver of such plan.
								(4)Time of
				paymentPayments under paragraph (2) for any fiscal year shall be
				made during the last quarter of such year.
							(5)Use of
				paymentsPayments made to a State from the Incentive Pool shall
				be used for any purpose that the State determines is likely to reduce the
				percentage of low-income children in the State without health insurance.
							(6)Proration
				ruleIf the amount available for payment from the Incentive Pool
				is less than the total amount of payments to be made for such fiscal year, the
				Secretary shall reduce the payments described in paragraph (2) on a
				proportional basis.
							(7)ReferencesWith respect to a State plan under title
				XIX, any references to a child in this subsection shall include a reference to
				any individual provided medical assistance under the plan who has not attained
				age 19 (or, if a State has so elected under such State plan, age 20 or
				21).
							.
				(b)Redistribution of
			 unexpended fiscal year 2005 allotmentsNotwithstanding section
			 2104(f) of the Social Security Act (42 U.S.C. 1397dd(f)), with respect to
			 fiscal year 2008, the Secretary shall provide for a redistribution under such
			 section from the allotments for fiscal year 2005 under subsection (b) and (c)
			 of such section that are not expended by the end of fiscal year 2007, to each
			 State described in clause (iii) of section 2104(i)(2)(A) of the Social Security
			 Act, as added by section 102(a), of an amount that bears the same ratio to such
			 unexpended fiscal year 2005 allotments as the ratio of the fiscal year 2007
			 allotment determined for each such State under subsection (b) of section 2104
			 of such Act for fiscal year 2007 (without regard to any amounts paid, allotted,
			 or redistributed to the State under section 2104 for any preceding fiscal year)
			 bears to the total amount of the fiscal year 2007 allotments for all such
			 States (as so determined).
				(c)Conforming
			 amendment eliminating rules for redistribution of unexpended allotments for
			 fiscal years after 2005Effective January 1, 2008, section
			 2104(f) (42 U.S.C. 1397dd(f)) is amended to read as follows:

						(f)Unallocated
				portion of national allotment and unused allotmentsFor
				provisions relating to the distribution of portions of the unallocated national
				allotment under subsection (a) for fiscal years beginning with fiscal year
				2008, and unexpended allotments for fiscal years beginning with fiscal year
				2006, see subsection
				(j).
						.
				(d)Additional
			 funding for the Secretary To improve timeliness of data reporting and analysis
			 for purposes of determining enrollment increases under Medicaid and
			 CHIP
					(1)AppropriationThere
			 is appropriated, out of any money in the Treasury not otherwise appropriated,
			 $5,000,000 to the Secretary for fiscal year 2008 for the purpose of improving
			 the timeliness of the data reported and analyzed from the Medicaid Statistical
			 Information System (MSIS) for purposes of carrying out section 2104(j)(2)(B) of
			 the Social Security Act (as added by subsection (a)) and to provide guidance to
			 States with respect to any new reporting requirements related to such
			 improvements. Amounts appropriated under this paragraph shall remain available
			 until expended.
					(2)RequirementsThe
			 improvements made by the Secretary under paragraph (1) shall be designed and
			 implemented (including with respect to any necessary guidance for States) so
			 that, beginning no later than October 1, 2008, data regarding the enrollment of
			 low-income children (as defined in section 2110(c)(4) of the Social Security
			 Act (42 U.S.C. 1397jj(c)(4)) of a State enrolled in the State plan under
			 Medicaid or the State child health plan under CHIP with respect to a fiscal
			 year shall be collected and analyzed by the Secretary within 6 months of
			 submission.
					106.Phase-out of
			 coverage for nonpregnant childless adults under CHIP; conditions for coverage
			 of parents
				(a)Phase-out
			 rules
					(1)In
			 generalTitle XXI (42 U.S.C. 1397aa et seq.) is amended by adding
			 at the end the following new section:

							2111.Phase-out of
				coverage for nonpregnant childless adults; conditions for coverage of
				parents
								(a)Termination of
				coverage for nonpregnant childless adults
									(1)No new CHIP
				waivers; automatic extensions at state option through fiscal year
				2008Notwithstanding section 1115 or any other provision of this
				title, except as provided in this subsection—
										(A)the Secretary shall
				not on or after the date of the enactment of the
				Children's Health Insurance Program
				Reauthorization Act of 2007, approve or renew a waiver,
				experimental, pilot, or demonstration project that would allow funds made
				available under this title to be used to provide child health assistance or
				other health benefits coverage to a nonpregnant childless adult; and
										(B)notwithstanding
				the terms and conditions of an applicable existing waiver, the provisions of
				paragraphs (2) and (3) shall apply for purposes of any fiscal year beginning on
				or after October 1, 2008, in determining the period to which the waiver
				applies, the individuals eligible to be covered by the waiver, and the amount
				of the Federal payment under this title.
										(2)Termination of
				CHIP coverage under applicable existing waivers at the end of fiscal year
				2008
										(A)In
				generalNo funds shall be available under this title for child
				health assistance or other health benefits coverage that is provided to a
				nonpregnant childless adult under an applicable existing waiver after September
				30, 2008.
										(B)Extension upon
				State requestIf an applicable existing waiver described in
				subparagraph (A) would otherwise expire before October 1, 2008, and the State
				requests an extension of such waiver, the Secretary shall grant such an
				extension, but only through September 30, 2008.
										(C)Application of
				enhanced FMAPThe enhanced FMAP determined under section 2105(b)
				shall apply to expenditures under an applicable existing waiver for the
				provision of child health assistance or other health benefits coverage to a
				nonpregnant childless adult during fiscal year 2008.
										(3)Optional 1-year
				transitional coverage block grant funded from state
				allotmentSubject to paragraph (4)(B), each State for which
				coverage under an applicable existing waiver is terminated under paragraph
				(2)(A) may elect to provide nonpregnant childless adults who were provided
				child health assistance or health benefits coverage under the applicable
				existing waiver at any time during fiscal year 2008 with such assistance or
				coverage during fiscal year 2009, as if the authority to provide such
				assistance or coverage under an applicable existing waiver was extended through
				that fiscal year, but subject to the following terms and conditions:
										(A)Block grant set
				aside from state allotmentThe Secretary shall set aside for the
				State an amount equal to the Federal share of the State's projected
				expenditures under the applicable existing waiver for providing child health
				assistance or health benefits coverage to all nonpregnant childless adults
				under such waiver for fiscal year 2008 (as certified by the State and submitted
				to the Secretary by not later than August 31, 2008, and without regard to
				whether any such individual lost coverage during fiscal year 2008 and was later
				provided child health assistance or other health benefits coverage under the
				waiver in that fiscal year), increased by the annual adjustment for fiscal year
				2009 determined under section 2104(i)(2)(B)(i). The Secretary may adjust the
				amount set aside under the preceding sentence, as necessary, on the basis of
				the expenditure data for fiscal year 2008 reported by States on CMS Form 64 or
				CMS Form 21 not later than November 30, 2008, but in no case shall the
				Secretary adjust such amount after December 31, 2008.
										(B)No coverage for
				nonpregnant childless adults who were not covered during fiscal year
				2008
											(i)FMAP applied to
				expendituresThe Secretary shall pay the State for each quarter
				of fiscal year 2009, from the amount set aside under subparagraph (A), an
				amount equal to the Federal medical assistance percentage (as determined under
				section 1905(b) without regard to clause (4) of such section) of expenditures
				in the quarter for providing child health assistance or other health benefits
				coverage to a nonpregnant childless adult but only if such adult was enrolled
				in the State program under this title during fiscal year 2008 (without regard
				to whether the individual lost coverage during fiscal year 2008 and was
				reenrolled in that fiscal year or in fiscal year 2009).
											(ii)Federal
				payments limited to amount of block grant set-asideNo payments
				shall be made to a State for expenditures described in this subparagraph after
				the total amount set aside under subparagraph (A) for fiscal year 2009 has been
				paid to the State.
											(4)State option to
				apply for medicaid waiver to continue coverage for nonpregnant childless
				adults
										(A)In
				generalEach State for which coverage under an applicable
				existing waiver is terminated under paragraph (2)(A) may submit, not later than
				June 30, 2009, an application to the Secretary for a waiver under section 1115
				of the State plan under title XIX to provide medical assistance to a
				nonpregnant childless adult whose coverage is so terminated (in this subsection
				referred to as a Medicaid nonpregnant childless adults
				waiver).
										(B)Deadline for
				approvalThe Secretary shall make a decision to approve or deny
				an application for a Medicaid nonpregnant childless adults waiver submitted
				under subparagraph (A) within 90 days of the date of the submission of the
				application. If no decision has been made by the Secretary as of September 30,
				2009, on the application of a State for a Medicaid nonpregnant childless adults
				waiver that was submitted to the Secretary by June 30, 2009, the application
				shall be deemed approved.
										(C)Standard for budget
				neutralityThe budget
				neutrality requirement applicable with respect to expenditures for medical
				assistance under a Medicaid nonpregnant childless adults waiver shall—
											(i)in the case of fiscal year 2010, allow
				expenditures for medical assistance under title XIX for all such adults to not
				exceed the total amount of payments made to the State under paragraph (3)(B)
				for fiscal year 2009, increased by the percentage increase (if any) in the
				projected nominal per capita amount of National Health Expenditures for
				calendar year 2010 over calendar year 2009, as most recently published by the
				Secretary; and
											(ii)in the case of any succeeding fiscal year,
				allow such expenditures to not exceed the amount in effect under this
				subparagraph for the preceding fiscal year, increased by the percentage
				increase (if any) in the projected nominal per capita amount of National Health
				Expenditures for the calendar year that begins during the fiscal year involved
				over the preceding calendar year, as most recently published by the
				Secretary.
											(b)Rules and
				conditions for coverage of parents of targeted low-income children
									(1)Two-year
				transition period; automatic extension at state option through fiscal year
				2009
										(A)No new CHIP
				waiversNotwithstanding section 1115 or any other provision of
				this title, except as provided in this subsection—
											(i)the Secretary
				shall not on or after the date of the enactment of the
				Children's Health Insurance Program
				Reauthorization Act of 2007 approve or renew a waiver,
				experimental, pilot, or demonstration project that would allow funds made
				available under this title to be used to provide child health assistance or
				other health benefits coverage to a parent of a targeted low-income child;
				and
											(ii)notwithstanding
				the terms and conditions of an applicable existing waiver, the provisions of
				paragraphs (2) and (3) shall apply for purposes of any fiscal year beginning on
				or after October 1, 2009, in determining the period to which the waiver
				applies, the individuals eligible to be covered by the waiver, and the amount
				of the Federal payment under this title.
											(B)Extension upon
				State requestIf an applicable existing waiver described in
				subparagraph (A) would otherwise expire before October 1, 2009, and the State
				requests an extension of such waiver, the Secretary shall grant such an
				extension, but only, subject to paragraph (2)(A), through September 30,
				2009.
										(C)Application of
				enhanced FMAPThe enhanced FMAP determined under section 2105(b)
				shall apply to expenditures under an applicable existing waiver for the
				provision of child health assistance or other health benefits coverage to a
				parent of a targeted low-income child during fiscal years 2008 and 2009.
										(2)Rules for fiscal
				years 2010 through 2012
										(A)Payments for
				coverage limited to block grant funded from state allotmentAny
				State that provides child health assistance or health benefits coverage under
				an applicable existing waiver for a parent of a targeted low-income child may
				elect to continue to provide such assistance or coverage through fiscal year
				2010, 2011, or 2012, subject to the same terms and conditions that applied
				under the applicable existing waiver, unless otherwise modified in subparagraph
				(B).
										(B)Terms and
				conditions
											(i)Block grant set
				aside from state allotmentIf the State makes an election under
				subparagraph (A), the Secretary shall set aside for the State for each such
				fiscal year an amount equal to the Federal share of 110 percent of the State's
				projected expenditures under the applicable existing waiver for providing child
				health assistance or health benefits coverage to all parents of targeted
				low-income children enrolled under such waiver for the fiscal year (as
				certified by the State and submitted to the Secretary by not later than August
				31 of the preceding fiscal year). In the case of fiscal year 2012, the set
				aside for any State shall be computed separately for each period described in
				clauses (i) and (ii) of subsection (i))(1)(D) and any increase or reduction in
				the allotment for either such period under subsection (i)(3)(B)(ii) shall be
				allocated on a pro rata basis to such set aside.
											(ii)Payments from
				block grantThe Secretary shall pay the State from the amount set
				aside under clause (i) for the fiscal year, an amount for each quarter of such
				fiscal year equal to the applicable percentage determined under clause (iii) or
				(iv) for expenditures in the quarter for providing child health assistance or
				other health benefits coverage to a parent of a targeted low-income
				child.
											(iii)Enhanced FMAP
				only in fiscal year 2010 for States with significant child outreach or that
				achieve child coverage benchmarks; FMAP for any other statesFor
				purposes of clause (ii), the applicable percentage for any quarter of fiscal
				year 2010 is equal to—
												(I)the enhanced FMAP
				determined under section 2105(b) in the case of a State that meets the outreach
				or coverage benchmarks described in any of subparagraphs (A), (B), or (C) of
				paragraph (3) for fiscal year 2009; or
												(II)the Federal
				medical assistance percentage (as determined under section 1905(b) without
				regard to clause (4) of such section) in the case of any other State.
												(iv)Amount of
				Federal matching payment in 2011 or 2012For purposes of clause
				(ii), the applicable percentage for any quarter of fiscal year 2011 or 2012 is
				equal to—
												(I)the REMAP
				percentage if the State met either of the coverage benchmarks described in
				subparagraph (B) or (C) of paragraph (3) for the preceding fiscal year;
				or
												(II)the Federal
				medical assistance percentage (as so determined) in the case of any State to
				which subclause (I) does not apply.
												For purposes
				of subclause (I), the REMAP percentage is the percentage which is the sum of
				such Federal medical assistance percentage and a number of percentage points
				equal to one-half of the difference between such Federal medical assistance
				percentage and such enhanced FMAP.(v)No federal
				payments other than from block grant set asideNo payments shall
				be made to a State for expenditures described in clause (ii) after the total
				amount set aside under clause (i) for a fiscal year has been paid to the
				State.
											(vi)No increase in
				income eligibility level for parentsNo payments shall be made to
				a State from the amount set aside under clause (i) for a fiscal year for
				expenditures for providing child health assistance or health benefits coverage
				to a parent of a targeted low-income child whose family income exceeds the
				income eligibility level applied under the applicable existing waiver to
				parents of targeted low-income children on the date of enactment of the
				Children's Health Insurance Program
				Reauthorization Act of 2007.
											(3)Outreach or
				coverage benchmarksFor purposes of paragraph (2), the outreach
				or coverage benchmarks described in this paragraph are as follows:
										(A)Significant
				child outreach campaignThe State—
											(i)was awarded a
				grant under section 2113 for fiscal year 2009;
											(ii)implemented 1 or
				more of the process measures described in section 2104(j)(3)(A)(i) for such
				fiscal year; or
											(iii)has submitted a
				specific plan for outreach for such fiscal year.
											(B)High-performing
				stateThe State, on the basis of the most timely and accurate
				published estimates of the Bureau of the Census, ranks in the lowest
				1/3 of States in terms of the State's percentage of
				low-income children without health insurance.
										(C)State increasing
				enrollment of low-income childrenThe State qualified for a
				payment from the Incentive Fund under paragraph (2)(C) of section 2104(j) for
				the most recent coverage period applicable under such section.
										(4)Rules of
				constructionNothing in this subsection shall be construed as
				prohibiting a State from submitting an application to the Secretary for a
				waiver under section 1115 of the State plan under title XIX to provide medical
				assistance to a parent of a targeted low-income child that was provided child
				health assistance or health benefits coverage under an applicable existing
				waiver.
									(c)Applicable
				existing waiverFor purposes of this section—
									(1)In
				generalThe term applicable existing waiver means a
				waiver, experimental, pilot, or demonstration project under section 1115,
				grandfathered under section 6102(c)(3) of the Deficit Reduction Act of 2005, or
				otherwise conducted under authority that—
										(A)would allow funds
				made available under this title to be used to provide child health assistance
				or other health benefits coverage to—
											(i)a
				parent of a targeted low-income child;
											(ii)a
				nonpregnant childless adult; or
											(iii)individuals
				described in both clauses (i) and (ii); and
											(B)was in effect
				during fiscal year 2007.
										(2)Definitions
										(A)ParentThe
				term parent includes a caretaker relative (as such term is used in
				carrying out section 1931) and a legal guardian.
										(B)Nonpregnant
				childless adultThe term nonpregnant childless adult
				has the meaning given such term by section
				2107(f).
										.
					(2)Conforming
			 amendments
						(A)Section 2107(f)
			 (42 U.S.C. 1397gg(f)) is amended—
							(i)by striking , the Secretary
			 and inserting “:

									(1)The
				Secretary
									;

							(ii)in
			 the first sentence, by inserting or a parent (as defined in section
			 2111(c)(2)(A)), who is not pregnant, of a targeted low-income child
			 before the period;
							(iii)by
			 striking the second sentence; and
							(iv)by
			 adding at the end the following new paragraph:

									(2)The Secretary may
				not approve, extend, renew, or amend a waiver, experimental, pilot, or
				demonstration project with respect to a State after the date of enactment of
				the Children's Health Insurance Program
				Reauthorization Act of 2007 that would waive or modify the
				requirements of section
				2111.
									.
							(B)Section 6102(c) of
			 the Deficit Reduction Act of 2005 (Public Law 109–171; 120 Stat. 131) is
			 amended by striking Nothing and inserting Subject to
			 section 2111 of the Social Security Act, as added by section 106(a)(1) of the
			 Children's Health Insurance Program
			 Reauthorization Act of 2007, nothing.
						(b)GAO study and
			 report
					(1)In
			 generalThe Comptroller General of the United States shall
			 conduct a study of whether—
						(A)the coverage of a
			 parent, a caretaker relative (as such term is used in carrying out section
			 1931), or a legal guardian of a targeted low-income child under a State health
			 plan under title XXI of the Social Security Act increases the enrollment of, or
			 the quality of care for, children, and
						(B)such parents,
			 relatives, and legal guardians who enroll in such a plan are more likely to
			 enroll their children in such a plan or in a State plan under title XIX of such
			 Act.
						(2)ReportNot
			 later than 2 years after the date of the enactment of this Act, the Comptroller
			 General shall report the results of the study to the appropriate committees of
			 Congress, including recommendations (if any) for changes in legislation.
					107.State option to
			 cover low-income pregnant women under CHIP through a state plan
			 amendment
				(a)In
			 generalTitle XXI (42 U.S.C.
			 1397aa et seq.), as amended by section 106(a), is amended by adding at the end
			 the following new section:

						2112.Optional coverage
				of targeted low-income pregnant women through a state plan amendment
							(a)In
				generalSubject to the
				succeeding provisions of this section, a State may elect through an amendment
				to its State child health plan under section 2102 to provide pregnancy-related
				assistance under such plan for targeted low-income pregnant women.
							(b)ConditionsA
				State may only elect the option under subsection (a) if the following
				conditions are satisfied:
								(1)Medicaid income
				eligibility level for pregnant women of at least 185 percent of
				povertyThe State has
				established an income eligibility level for pregnant women under subsection
				(a)(10)(A)(i)(III), (a)(10)(A)(i)(IV), or (l)(1)(A) of section 1902 that is at
				least 185 percent of the income official poverty line.
								(2)No CHIP income
				eligibility level for pregnant women lower than the State's Medicaid
				levelThe State does not
				apply an effective income level for pregnant women under the State plan
				amendment that is lower than the effective income level (expressed as a percent
				of the poverty line and considering applicable income disregards) specified
				under subsection (a)(10)(A)(i)(III), (a)(10)(A)(i)(IV), or (l)(1)(A) of section
				1902, on the date of enactment of this paragraph to be eligible for medical
				assistance as a pregnant woman.
								(3)No coverage for
				higher income pregnant women without covering lower income pregnant
				womenThe State does not
				provide coverage for pregnant women with higher family income without covering
				pregnant women with a lower family income.
								(4)Application of
				requirements for coverage of targeted low-income childrenThe State provides pregnancy-related
				assistance for targeted low-income pregnant women in the same manner, and
				subject to the same requirements, as the State provides child health assistance
				for targeted low-income children under the State child health plan, and in
				addition to providing child health assistance for such women.
								(5)No preexisting
				condition exclusion or waiting periodThe State does not apply any exclusion of
				benefits for pregnancy-related assistance based on any preexisting condition or
				any waiting period (including any waiting period imposed to carry out section
				2102(b)(3)(C)) for receipt of such assistance.
								(6)Application of
				cost-sharing protectionThe
				State provides pregnancy-related assistance to a targeted low-income woman
				consistent with the cost-sharing protections under section 2103(e) and applies
				the limitation on total annual aggregate cost sharing imposed under paragraph
				(3)(B) of such section to the family of such a woman.
								(c)Option To
				provide presumptive eligibilityA State that elects the option under
				subsection (a) and satisfies the conditions described in subsection (b) may
				elect to apply section 1920 (relating to presumptive eligibility for pregnant
				women) to the State child health plan in the same manner as such section
				applies to the State plan under title XIX.
							(d)DefinitionsFor purposes of this section:
								(1)Pregnancy-related
				assistanceThe term
				pregnancy-related assistance has the meaning given the term
				child health assistance in section 2110(a) and includes any
				medical assistance that the State would provide for a pregnant woman under the
				State plan under title XIX during pregnancy and the period described in
				paragraph (2)(A).
								(2)Targeted
				low-income pregnant womanThe
				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 does not exceed the
				income eligibility level established under the State child health plan under
				this title for a targeted low-income child; and
									(C)who satisfies the requirements of
				paragraphs (1)(A), (1)(C), (2), and (3) of section 2110(b) in the same manner
				as a child applying for child health assistance would have to satisfy such
				requirements.
									(e)Automatic
				enrollment for children born to women receiving pregnancy-related
				assistanceIf a child is born
				to a targeted low-income pregnant woman who was receiving pregnancy-related
				assistance 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
				attains 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 medical assistance eligibility identification number of the
				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 identification number for the child before such period
				expires).
							(f)States providing
				assistance through other options
								(1)Continuation of
				other options for providing assistanceThe option to provide assistance in
				accordance with the preceding subsections of this section shall not limit any
				other option for a State to provide—
									(A)child health assistance through the
				application of sections 457.10, 457.350(b)(2), 457.622(c)(5), and 457.626(a)(3)
				of title 42, Code of Federal Regulations (as in effect after the final rule
				adopted by the Secretary and set forth at 67 Fed. Reg. 61956–61974 (October 2,
				2002)), or
									(B)pregnancy-related services through the
				application of any waiver authority (as in effect on June 1, 2007).
									(2)Clarification of
				authority to provide postpartum servicesAny State that provides child health
				assistance under any authority described in paragraph (1) may continue to
				provide such assistance, as well as postpartum services, through the end of the
				month in which the 60-day period (beginning on the last day of the pregnancy)
				ends, in the same manner as such assistance and postpartum services would be
				provided if provided under the State plan under title XIX, but only if the
				mother would otherwise satisfy the eligibility requirements that apply under
				the State child health plan (other than with respect to age) during such
				period.
								(3)No
				inferenceNothing in this subsection shall be construed—
									(A)to infer
				congressional intent regarding the legality or illegality of the content of the
				sections specified in paragraph (1)(A); or
									(B)to modify the
				authority to provide pregnancy-related services under a waiver specified in
				paragraph
				(1)(B).
									.
				(b)Additional
			 conforming amendments
					(1)No cost sharing
			 for pregnancy-related benefitsSection 2103(e)(2) (42 U.S.C. 1397cc(e)(2))
			 is amended—
						(A)in the heading, by inserting
			 or pregnancy-related
			 assistance after preventive services;
			 and
						(B)by inserting before the period at the end
			 the following: or for pregnancy-related assistance.
						(2)No waiting
			 periodSection 2102(b)(1)(B)
			 (42 U.S.C. 1397bb(b)(1)(B)) is amended—
						(A)in clause (i), by striking ,
			 and at the end and inserting a semicolon;
						(B)in clause (ii), by striking the period at
			 the end and inserting ; and; and
						(C)by adding at the end the following new
			 clause:

								(iii)may not apply a waiting period (including a
				waiting period to carry out paragraph (3)(C)) in the case of a targeted
				low-income pregnant woman provided pregnancy-related assistance under section
				2112.
								.
						108.CHIP Contingency
			 fundSection 2104 (42 U.S.C.
			 1397dd), as amended by section 105, is amended by adding at the end the
			 following new subsection:

					(k)CHIP contingency
				fund
						(1)EstablishmentThere
				is hereby established in the Treasury of the United States a fund which shall
				be known as the CHIP Contingency Fund (in this subsection
				referred to as the Fund). Amounts in the Fund are authorized to
				be appropriated for payments under this subsection.
						(2)Deposits into
				fund
							(A)Initial and
				subsequent appropriationsSubject to subparagraphs (B) and (E),
				out of any money in the Treasury of the United States not otherwise
				appropriated, there are appropriated to the Fund—
								(i)for fiscal year
				2009, an amount equal to 12.5 percent of the available national allotment under
				subsection (i)(1)(C) for the fiscal year; and
								(ii)for each of
				fiscal years 2010 through 2012, such sums as are necessary for making payments
				to eligible States for such fiscal year, but not in excess of the aggregate cap
				described in subparagraph (B).
								(B)Aggregate
				capSubject to subparagraph (E), the total amount available for
				payment from the Fund for each of fiscal years 2009 through 2012 (taking into
				account deposits made under subparagraph (C)), shall not exceed 12.5 percent of
				the available national allotment under subsection (i)(1)(C) for the fiscal
				year.
							(C)Investment of
				fundThe Secretary of the Treasury shall invest, in interest
				bearing securities of the United States, such currently available portions of
				the Fund as are not immediately required for payments from the Fund. The income
				derived from these investments constitutes a part of the Fund.
							(D)Transfer of
				excess funds to the incentive fundThe Secretary of the Treasury
				shall transfer to, and deposit in, the CHIP Incentive Bonuses Pool established
				under subsection (j) any amounts in excess of the aggregate cap described in
				subparagraph (B) for a fiscal year.
							(E)Special rules
				for amounts set aside for parents and childless adultsFor
				purposes of subparagraphs (A) and (B)—
								(i)the
				available national allotment under subsection (i)(1)(C) shall be reduced by any
				amount set aside under section 2111(a)(3) for block grant payments for
				transitional coverage for childless adults; and
								(ii)the Secretary
				shall establish a separate account in the Fund for the portion of any amount
				appropriated to the Fund for any fiscal year which is allocable to the portion
				of the available national allotment under subsection (i)(1)(C) which is set
				aside for the fiscal year under section 2111(b)(2)(B)(i) for coverage of
				parents of low-income children.
								The
				Secretary shall include in the account established under clause (ii) any income
				derived under subparagraph (C) which is allocable to amounts in such
				account.(3)CHIP contingency
				fund payments
							(A)Payments
								(i)In
				generalSubject to clauses (ii) and (iii) and the succeeding
				subparagraphs of this paragraph, the Secretary shall pay from the Fund to a
				State that is an eligible State for a month of a fiscal year a CHIP contingency
				fund payment equal to the Federal share of the shortfall determined under
				subparagraph (D). In the case of an eligible State under subparagraph (D)(i),
				the Secretary shall not make the payment under this subparagraph until the
				State makes, and submits to the Secretary, a projection of the amount of the
				shortfall.
								(ii)Separate
				determinations of shortfallsThe Secretary shall separately
				compute the shortfall under subparagraph (D) for expenditures for eligible
				individuals other than nonpregnant childless adults and parents with respect to
				whom amounts are set aside under section 2111, for expenditures for such
				childless adults, and for expenditures for such parents.
								(iii)Payments
									(I)Nonpregnant
				childless adultsNo payments shall be made from the Fund for
				nonpregnant childless adults with respect to whom amounts are set aside under
				section 2111(a)(3).
									(II)ParentsAny
				payments with respect to any shortfall for parents who are paid from amounts
				set aside under section 2111(b)(2)(B)(i) shall be made only from the account
				established under paragraph (2)(E)(ii) and not from any other amounts in the
				Fund. No other payments may be made from such account.
									(iv)Special
				rulesSubparagraphs (B) and (C) shall be applied separately with
				respect to shortfalls described in clause (ii).
								(B)Use of
				fundsAmounts paid to an eligible State from the Fund shall be
				used only to eliminate the Federal share of a shortfall in the State's
				allotment under subsection (i) for a fiscal year.
							(C)Proration
				ruleIf the amounts available for payment from the Fund for a
				fiscal year are less than the total amount of payments determined under
				subparagraph (A) for the fiscal year, the amount to be paid under such
				subparagraph to each eligible State shall be reduced proportionally.
							(D)Eligible
				State
								(i)In
				generalA State is an eligible State for a month if the State is
				a subsection (b) State (as defined in subsection (i)(7)), the State requests
				access to the Fund for the month, and it is described in clause (ii) or
				(iii).
								(ii)Shortfall of
				federal allotment funding of not more than 5 percentThe
				Secretary estimates, on the basis of the most recent data available to the
				Secretary or requested from the State by the Secretary, that the State's
				allotment for the fiscal year is at least 95 percent, but less than 100
				percent, of the projected expenditures under the State child health plan for
				the State for the fiscal year determined under subsection (i) (without regard
				to incentive bonuses or payments for which the State is eligible for under
				subsection (j)(2) for the fiscal year).
								(iii)Shortfall of
				federal allotment funding of more than 5 percent caused by specific
				eventsThe Secretary estimates, on the basis of the most recent
				data available to the Secretary or requested from the State by the Secretary,
				that the State's allotment for the fiscal year is less than 95 percent of the
				projected expenditures under the State child health plan for the State for the
				fiscal year determined under subsection (i) (without regard to incentive
				bonuses or payments for which the State is eligible for under subsection (j)(2)
				for the fiscal year) and that such shortfall is attributable to 1 or more of
				the following events:
									(I)Stafford Act or
				public health emergencyThe State has—
										(aa)1 or
				more parishes or counties for which a major disaster has been declared in
				accordance with section 401 of the Robert T. Stafford Disaster Relief and
				Emergency Assistance Act (42 U.S.C. 5170) and which the President has
				determined warrants individual and public assistance from the Federal
				Government under such Act; or
										(bb)a
				public health emergency declared by the Secretary under section 319 of the
				Public Health Service Act.
										(II)State economic
				downturnThe State unemployment rate is at least 5.5 percent
				during any 13-consecutive week period during the fiscal year and such rate is
				at least 120 percent of the State unemployment rate for the same period as
				averaged over the last 3 fiscal years.
									(III) Event
				resulting in rise in percentage of low-income children without health
				insuranceThe State experienced a recent event that resulted in
				an increase in the percentage of low-income children in the State without
				health insurance (as determined on the basis of the most timely and accurate
				published estimates of the Bureau of the Census) that was outside the control
				of the State and warrants granting the State access to the Fund (as determined
				by the Secretary).
									(E)Payments made to
				all eligible states on a monthly basis; authority for pro rata
				paymentsThe Secretary shall make monthly payments from the Fund
				to all States that are determined to be eligible States with respect to a
				month. If the sum of the payments to be made from the Fund for a month exceed
				the amount in the Fund, the Secretary shall reduce each such payment on a
				proportional basis.
							(F)Payments limited
				to fiscal year of eligibility determination unless new eligibility basis
				determinedNo State shall receive a CHIP contingency fund payment
				under this section for a month beginning after September 30 of the fiscal year
				in which the State is determined to be an eligible State under this subsection,
				except that in the case of an event described in subclause (I) or (III) of
				subparagraph (D)(iii) that occurred after July 1 of the fiscal year, any such
				payment with respect to such event shall remain available until September 30 of
				the subsequent fiscal year. Nothing in the preceding sentence shall be
				construed as prohibiting a State from being determined to be an eligible State
				under this subsection for any fiscal year occurring after a fiscal year in
				which such a determination is made.
							(G)Exemption from
				determination of percentage of allotment retained after first year of
				availabilityIn no event shall payments made to a State under
				this subsection be treated as part of the allotment determined for a State for
				a fiscal year under subsection (i) for purposes of subsection
				(j)(1)(B)(ii)(III).
							(H)Application of
				allotment reporting rulesRules applicable to States for purposes
				of receiving payments from an allotment determined under subsection (c) or (i)
				shall apply in the same manner to an eligible State for purposes of receiving a
				CHIP contingency fund payment under this subsection.
							(4)Annual
				reportsThe Secretary shall annually report to the Congress on
				the amounts in the Fund, the specific events that caused States to apply for
				payments from the Fund, and the payments made from the
				Fund.
						.
			109.Two-year
			 availability of allotments; expenditures counted against oldest
			 allotmentsSection 2104(e) (42
			 U.S.C. 1397dd(e)) is amended to read as follows:

					(e)Availability of
				amounts allotted
						(1)In
				generalExcept as provided in subsection (j)(1)(B)(ii)(III),
				amounts allotted to a State pursuant to this section—
							(A)for each of fiscal
				years 1998 through 2006, shall remain available for expenditure by the State
				through the end of the second succeeding fiscal year; and
							(B)for each of fiscal
				years 2007 through 2012, shall remain available for expenditure by the State
				only through the end of the succeeding fiscal year for which such amounts are
				allotted.
							(2)Incentive
				bonusesIncentive bonuses paid to a State under subsection (j)(2)
				for a fiscal year shall remain available for expenditure by the State without
				limitation.
						(3)CHIP Contingency
				Fund paymentsExcept as provided in paragraph (3)(F) of
				subsection (k), CHIP Contingency Fund payments made to a State under such
				subsection for a month of a fiscal year shall remain available for expenditure
				by the State through the end of the fiscal year.
						(4)Rule for
				counting expenditures against CHIP contingency Fund payments, fiscal year
				allotments, and incentive bonuses
							(A)In
				generalExpenditures under the State child health plan made on or
				after October 1, 2007, shall be counted against—
								(i)first, any CHIP
				Contingency Fund payment made to the State under subsection (k) for the
				earliest month of the earliest fiscal year for which the payment remains
				available for expenditure; and
								(ii)second, amounts
				allotted to the State for the earliest fiscal year for which amounts remain
				available for expenditure.
								(B)Incentive
				bonusesA State may elect, but is not required, to count
				expenditures under the State child health plan against any incentive bonuses
				paid to the State under subsection (j)(2) for a fiscal year.
							(C)Block grant
				set-asidesExpenditures for coverage of—
								(i)nonpregnant
				childless adults for fiscal year 2009 shall be counted only against the amount
				set aside for such coverage under section 2111(a)(3); and
								(ii)parents of
				targeted low-income children for each of fiscal years 2010 through 2012, shall
				be counted only against the amount set aside for such coverage under section
				2111(b)(2)(B)(i).
								.
			110.Limitation on
			 matching rate for States that propose to cover children with effective family
			 income that exceeds 300 percent of the poverty line
				(a)FMAP applied to
			 expendituresSection 2105(c)
			 (42 U.S.C. 1397ee(c)) is amended by adding at the end the following new
			 paragraph:

						(8)Limitation on
				matching rate for expenditures for child health assistance provided to children
				whose effective family income exceeds 300 percent of the poverty line
							(A)FMAP applied to
				expendituresExcept as
				provided in subparagraph (B), for fiscal years beginning with fiscal year 2008,
				the Federal medical assistance percentage (as determined under section 1905(b)
				without regard to clause (4) of such section) shall be substituted for the
				enhanced FMAP under subsection (a)(1) with respect to any expenditures for
				providing child health assistance or health benefits coverage for a targeted
				low-income child whose effective family income would exceed 300 percent of the
				poverty line but for the application of a general exclusion of a block of
				income that is not determined by type of expense or type of income.
							(B)ExceptionSubparagraph (A) shall not apply to any
				State that, on the date of enactment of the Children's Health Insurance Program Reauthorization Act of
				2007, has an approved State plan amendment or waiver to provide,
				or has enacted a State law to submit a State plan amendment to provide,
				expenditures described in such subparagraph under the State child health
				plan.
							.
				(b)Conforming
			 amendmentSection 2105(a)(1) ( 42 U.S.C. 1397dd(a)(1)) is
			 amended, in the matter preceding subparagraph (A), by inserting or
			 subsection (c)(8) after subparagraph (B).
				111.Option for
			 qualifying states to receive the enhanced portion of the CHIP matching rate for
			 Medicaid coverage of certain childrenSection 2105(g) (42 U.S.C. 1397ee(g)) is
			 amended—
				(1)in paragraph (1)(A), by inserting
			 subject to paragraph (4), after Notwithstanding any other
			 provision of law,; and
				(2)by adding at the
			 end the following new paragraph:

						(4)Option for
				allotments for fiscal years 2008 through 2012
							(A)Payment of
				enhanced portion of matching rate for certain expendituresIn the
				case of expenditures described in subparagraph (B), a qualifying State (as
				defined in paragraph (2)) may elect to be paid from the State's allotment made
				under section 2104 for any of fiscal years 2008 through 2012 (insofar as the
				allotment is available to the State under subsections (e) and (i) of such
				section) an amount each quarter equal to the additional amount that would have
				been paid to the State under title XIX with respect to such expenditures if the
				enhanced FMAP (as determined under subsection (b)) had been substituted for the
				Federal medical assistance percentage (as defined in section 1905(b)).
							(B)Expenditures
				describedFor purposes of subparagraph (A), the expenditures
				described in this subparagraph are expenditures made after the date of the
				enactment of this paragraph and during the period in which funds are available
				to the qualifying State for use under subparagraph (A), for the provision of
				medical assistance to individuals residing in the State who are eligible for
				medical assistance under the State plan under title XIX or under a waiver of
				such plan and who have not attained age 19 (or, if a State has so elected under
				the State plan under title XIX, age 20 or 21), and whose family income equals
				or exceeds 133 percent of the poverty line but does not exceed the Medicaid
				applicable income
				level.
							.
				IIOutreach and
			 Enrollment
			201.Grants for
			 outreach and enrollment
				(a)GrantsTitle
			 XXI (42 U.S.C. 1397aa et seq.), as amended by section 107, is amended by adding
			 at the end the following:

						2113.Grants to
				improve outreach and enrollment
							(a)Outreach and
				enrollment grants; national campaign
								(1)In
				generalFrom the amounts appropriated under subsection (g),
				subject to paragraph (2), the Secretary shall award grants to eligible entities
				during the period of fiscal years 2008 through 2012 to conduct outreach and
				enrollment efforts that are designed to increase the enrollment and
				participation of eligible children under this title and title XIX.
								(2)Ten percent set
				aside for national enrollment campaignAn amount equal to 10
				percent of such amounts shall be used by the Secretary for expenditures during
				such period to carry out a national enrollment campaign in accordance with
				subsection (h).
								(b)Priority for
				Award of Grants
								(1)In
				generalIn awarding grants under subsection (a), the Secretary
				shall give priority to eligible entities that—
									(A)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)submit the most
				demonstrable evidence required under paragraphs (1) and (2) of subsection
				(c).
									(2)Ten percent set
				aside for outreach to indian childrenAn amount equal to 10
				percent of the funds appropriated under subsection (g) shall be used by the
				Secretary to award grants to Indian Health Service providers and urban Indian
				organizations receiving funds under title V of the
				Indian Health Care Improvement Act
				(25 U.S.C. 1651 et seq.) for outreach to, and enrollment of, children who are
				Indians.
								(c)ApplicationAn
				eligible entity that desires to receive a grant under subsection (a) shall
				submit an application to the Secretary in such form and manner, and containing
				such information, as the Secretary may decide. Such application shall
				include—
								(1)evidence
				demonstrating that the entity includes members who have access to, and
				credibility with, ethnic or low-income populations in the communities in which
				activities funded under the grant are to be conducted;
								(2)evidence
				demonstrating that the entity has the ability to address barriers to
				enrollment, such as lack of awareness of eligibility, stigma concerns and
				punitive fears associated with receipt of benefits, and other cultural barriers
				to applying for and receiving child health assistance or medical
				assistance;
								(3)specific quality or
				outcomes performance measures to evaluate the effectiveness of activities
				funded by a grant awarded under this section; and
								(4)an assurance that
				the eligible entity shall—
									(A)conduct an
				assessment of the effectiveness of such activities against the performance
				measures;
									(B)cooperate with the
				collection and reporting of enrollment data and other information in order for
				the Secretary to conduct such assessments; and
									(C)in the case of an
				eligible entity that is not the State, provide the State with enrollment data
				and other information as necessary for the State to make necessary projections
				of eligible children and pregnant women.
									(d)Dissemination of
				Enrollment Data and Information Determined From Effectiveness Assessments;
				Annual ReportThe Secretary shall—
								(1)make publicly
				available the enrollment data and information collected and reported in
				accordance with subsection (c)(4)(B); and
								(2)submit an annual
				report to Congress on the outreach and enrollment activities conducted with
				funds appropriated under this section.
								(e)Maintenance of
				effort for states awarded grants; no state match requiredIn the
				case of a State that is awarded a grant under this section—
								(1)the State share of
				funds expended for outreach and enrollment activities under the State child
				health plan shall not be less than the State share of such funds expended in
				the fiscal year preceding the first fiscal year for which the grant is awarded;
				and
								(2)no State matching
				funds shall be required for the State to receive a grant under this
				section.
								(f)DefinitionsIn
				this section:
								(1)Eligible
				entityThe term eligible entity means any of the
				following:
									(A)A State with an
				approved child health plan under this title.
									(B)A local
				government.
									(C)An Indian tribe or
				tribal consortium, a tribal organization, an urban Indian organization
				receiving funds under title V of the Indian
				Health Care Improvement Act (25 U.S.C. 1651 et seq.), or an Indian
				Health Service provider.
									(D)A Federal health
				safety net organization.
									(E)A national, State,
				local, or community-based public or nonprofit private organization, including
				organizations that use community health workers or community-based doula
				programs.
									(F)A faith-based
				organization or consortia, to the extent that a grant awarded to such an entity
				is consistent with the requirements of section 1955 of the
				Public Health Service Act (42 U.S.C.
				300x–65) relating to a grant award to nongovernmental entities.
									(G)An elementary or
				secondary school.
									(2)Federal health
				safety net organizationThe term Federal health safety net
				organization means—
									(A)a
				Federally-qualified health center (as defined in section 1905(l)(2)(B));
									(B)a hospital defined
				as a disproportionate share hospital for purposes of section 1923;
									(C)a covered entity
				described in section 340B(a)(4) of the Public
				Health Service Act (42 U.S.C. 256b(a)(4)); and
									(D)any other entity
				or consortium that serves children under a federally funded program, including
				the special supplemental nutrition 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 organization; urban indian organizationThe 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).
								(4)Community health
				workerThe term community health worker means an
				individual who promotes health or nutrition within the community in which the
				individual resides—
									(A)by serving as a
				liaison between communities and health care agencies;
									(B)by providing
				guidance and social assistance to community residents;
									(C)by enhancing
				community residents’ ability to effectively communicate with health care
				providers;
									(D)by providing
				culturally and linguistically appropriate health or nutrition education;
									(E)by advocating for
				individual and community health or nutrition needs; and
									(F)by providing
				referral and followup services.
									(g)AppropriationThere
				is appropriated, out of any money in the Treasury not otherwise appropriated,
				$100,000,000 for the period of fiscal years 2008 through 2012, to remain
				available until expended, 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 subsections (a)(1)(D)(iii) and
				(c)(2)(C) of that section.
							(h)National
				Enrollment CampaignFrom the amounts made available under
				subsection (a)(2), the Secretary shall develop and implement a national
				enrollment campaign to improve the enrollment of underserved child populations
				in the programs established under this title and title XIX. Such campaign may
				include—
								(1)the establishment
				of partnerships with the Secretary of Education and the Secretary of
				Agriculture to develop national campaigns to link the eligibility and
				enrollment systems for the assistance programs each Secretary administers that
				often serve the same children;
								(2)the integration of
				information about the programs established under this title and title XIX in
				public health awareness campaigns administered by the Secretary;
								(3)increased
				financial and technical support for enrollment hotlines maintained by the
				Secretary to ensure that all States participate in such hotlines;
								(4)the establishment
				of joint public awareness outreach initiatives with the Secretary of Education
				and the Secretary of Labor regarding the importance of health insurance to
				building strong communities and the economy;
								(5)the development of
				special outreach materials for Native Americans or for individuals with limited
				English proficiency; and
								(6)such other
				outreach initiatives as the Secretary determines would increase public
				awareness of the programs under this title and title
				XIX.
								.
				(b)Enhanced
			 administrative funding for translation or interpretation services under
			 CHIPSection 2105(a)(1) (42 U.S.C. 1397ee(a)(1)), as amended by
			 section 603, is amended—
					(1)in the matter
			 preceding subparagraph (A), by inserting (or, in the case of
			 expenditures described in subparagraph (D)(iv), the higher of 75 percent or the
			 sum of the enhanced FMAP plus 5 percentage points) after
			 enhanced FMAP; and
					(2)in subparagraph
			 (D)—
						(A)in clause (iii),
			 by striking and at the end;
						(B)by redesignating
			 clause (iv) as clause (v); and
						(C)by inserting after
			 clause (iii) the following new clause:

								(iv)for translation
				or interpretation services in connection with the enrollment and use of
				services under this title by individuals for whom English is not their primary
				language (as found necessary by the Secretary for the proper and efficient
				administration of the State plan);
				and
								.
						(c)Nonapplication
			 of administrative expenditures capSection 2105(c)(2) (42 U.S.C.
			 1397ee(c)(2)) is amended by adding at the end the following:

						(C)Nonapplication
				to certain expendituresThe limitation under subparagraph (A)
				shall not apply with respect to the following expenditures:
							(i)Expenditures
				funded under section 2113Expenditures for outreach and
				enrollment activities funded under a grant awarded to the State under section
				2113.
							.
				202.
			 Increased outreach and enrollment of Indians
				(a)In
			 generalSection 1139 (42
			 U.S.C. 1320b–9) is amended to read as follows:

						1139.Improved
				access to, and delivery of, health care for Indians under titles XIX and
				XXI
							(a)Agreements with
				States for Medicaid and CHIP outreach On or near reservations To increase the
				enrollment of Indians in those programs
								(1)In
				generalIn order to improve the access of Indians residing on or
				near a reservation to obtain benefits under the Medicaid and State children's
				health insurance programs established under titles XIX and XXI, the Secretary
				shall encourage the State to take steps to provide for enrollment on or near
				the reservation. Such steps may include outreach efforts such as the
				outstationing of eligibility workers, entering into agreements with the Indian
				Health Service, Indian Tribes, Tribal Organizations, and Urban Indian
				Organizations to provide outreach, education regarding eligibility and
				benefits, enrollment, and translation services when such services are
				appropriate.
								(2)ConstructionNothing
				in paragraph (1) shall be construed as affecting arrangements entered into
				between States and the Indian Health Service, Indian Tribes, Tribal
				Organizations, or Urban Indian Organizations for such Service, Tribes, or
				Organizations to conduct administrative activities under such titles.
								(b)Requirement To
				facilitate cooperationThe Secretary, acting through the Centers
				for Medicare & Medicaid Services, shall take such steps as are necessary to
				facilitate cooperation with, and agreements between, States and the Indian
				Health Service, Indian Tribes, Tribal Organizations, or Urban Indian
				Organizations with respect to the provision of health care items and services
				to Indians under the programs established under title XIX or XXI.
							(c)Definition of
				Indian; Indian Tribe; Indian Health Program; Tribal Organization; Urban Indian
				OrganizationIn this section, the terms Indian,
				Indian Tribe, Indian Health Program, Tribal
				Organization, and Urban Indian Organization have the
				meanings given those terms in section 4 of the Indian Health Care Improvement
				Act.
							.
				(b)Nonapplication
			 of 10 percent limit on outreach and certain other
			 expendituresSection 2105(c)(2)(C) (42 U.S.C. 1397ee(c)(2)(C)),
			 as added by section 201(c), is amended by adding at the end the following new
			 clause:

						(ii)Expenditures to
				increase outreach to, and the enrollment of, Indian children under this title
				and title XIXExpenditures for outreach activities to families of
				Indian children likely to be eligible for child health assistance under the
				plan or medical assistance under the State plan under title XIX (or under a
				waiver of such plan), to inform such families of the availability of, and to
				assist them in enrolling their children in, such plans, including such
				activities conducted under grants, contracts, or agreements entered into under
				section
				1139(a).
						.
				203.Demonstration
			 program to permit States to rely on findings by an Express Lane agency to
			 determine components of a child’s eligibility for Medicaid or CHIP
				(a)Requirement To
			 Conduct Demonstration program
					(1)In
			 generalThe Secretary shall establish a 3–year demonstration
			 program under which up to 10 States shall be authorized to rely on a finding
			 made within the preceding 12 months by an Express Lane agency to determine
			 whether a child has met 1 or more of the eligibility requirements, such as
			 income, assets or resources, citizenship status, or other criteria, necessary
			 to determine the child's initial eligibility, eligibility redetermination, or
			 renewal of eligibility, for medical assistance under the State Medicaid plan or
			 child health assistance under the State CHIP plan. A State selected to
			 participate in the demonstration program—
						(A)shall not be
			 required to direct a child (or a child’s family) to submit information or
			 documentation previously submitted by the child or family to an Express Lane
			 agency that the State relies on for its Medicaid or CHIP eligibility
			 determination; and
						(B)may rely on
			 information from an Express Lane agency when evaluating a child’s eligibility
			 for medical assistance under the State Medicaid plan or child health assistance
			 under the State CHIP plan without a separate, independent confirmation of the
			 information at the time of enrollment, redetermination, or renewal.
						(2)Payments to
			 statesFrom the amount appropriated under paragraph (1) of
			 subsection (f), after the application of paragraph (2) of that subsection, the
			 Secretary shall pay the States selected to participate in the demonstration
			 program such sums as the Secretary shall determine for expenditures made by the
			 State for systems upgrades and implementation of the demonstration program. In
			 no event shall a payment be made to a State from the amount appropriated under
			 subsection (f) for any expenditures incurred for providing medical assistance
			 or child health assistance to a child enrolled in the State Medicaid plan or
			 the State CHIP plan through reliance on a finding made by an Express Lane
			 agency.
					(b)Requirements;
			 options for application
					(1)State
			 requirementsA State selected to participate in the demonstration
			 program established under this section may rely on a finding of an Express Lane
			 agency only if the following conditions are met:
						(A)Requirement to
			 determine eligibility using regular procedures if child is first found
			 ineligibleIf reliance on a finding from an Express Lane agency
			 results in a child not being found eligible for the State Medicaid plan or the
			 State CHIP plan, the State would be required to determine eligibility under
			 such plan using its regular procedures.
						(B)NoticeThe
			 State shall inform the families (especially those whose children are enrolled
			 in the State CHIP plan) that they may qualify for lower premium payments or
			 more comprehensive health coverage under the State Medicaid plan if the
			 family’s income were directly evaluated for an eligibility determination by the
			 State Medicaid agency, and that, at the family’s option, the family may seek an
			 eligibility determination by the State Medicaid agency.
						(C)Compliance with
			 Department of Homeland Security proceduresThe State may rely on
			 an Express Lane agency finding that a child is a qualified alien as long as the
			 Express Lane agency complies with guidance and regulatory procedures issued by
			 the Secretary of Homeland Security for eligibility determinations of qualified
			 aliens (as defined in subsections (b) and (c) of section 431 of the Personal
			 Responsibility and Work Opportunity Reconciliation Act of 1996 (8 U.S.C.
			 1641)).
						(D)Verification of
			 citizenship or nationality statusThe State shall satisfy the
			 requirements of section 1902(a)(46)(B) or 2105(c)(9) of the Social Security
			 Act, as applicable (and as added by section 301 of this Act) for verifications
			 of citizenship or nationality status.
						(E)Coding;
			 application to enrollment error rates
							(i)In
			 generalThe State agrees to—
								(I)assign such codes
			 as the Secretary shall require to the children who are enrolled in the State
			 Medicaid plan or the State CHIP plan through reliance on a finding made by an
			 Express Lane agency for the duration of the State's participation in the
			 demonstration program;
								(II)annually provide
			 the Secretary with a statistically valid sample (that is approved by Secretary)
			 of the children enrolled in such plans through reliance on such a finding by
			 conducting a full Medicaid eligibility review of the children identified for
			 such sample for purposes of determining an eligibility error rate with respect
			 to the enrollment of such children;
								(III)submit the error
			 rate determined under subclause (II) to the Secretary;
								(IV)if such error
			 rate exceeds 3 percent for either of the first 2 fiscal years in which the
			 State participates in the demonstration program, demonstrate to the
			 satisfaction of the Secretary the specific corrective actions implemented by
			 the State to improve upon such error rate; and
								(V)if such error rate
			 exceeds 3 percent for any fiscal year in which the State participates in the
			 demonstration program, a reduction in the amount otherwise payable to the State
			 under section 1903(a) of the Social Security Act (42 Secretary 1396b(a)) for
			 quarters for that fiscal year, equal to the total amount of erroneous excess
			 payments determined for the fiscal year only with respect to the children
			 included in the sample for the fiscal year that are in excess of a 3 percent
			 error rate with respect to such children.
								(ii)No punitive
			 action based on error rateThe Secretary shall not apply the
			 error rate derived from the sample under clause (i) to the entire population of
			 children enrolled in the State Medicaid plan or the State CHIP plan through
			 reliance on a finding made by an Express Lane agency, or to the population of
			 children enrolled in such plans on the basis of the State's regular procedures
			 for determining eligibility, or penalize the State on the basis of such error
			 rate in any manner other than the reduction of payments provided for under
			 clause (i)(V).
							(iii)Rule of
			 constructionNothing in this section shall be construed as
			 relieving a State that participates in the demonstration program established
			 under this section from being subject to a penalty under section 1903(u) of the
			 Social Security Act (42 U.S.C. 1396b(u)) for payments made under the State
			 Medicaid plan with respect to ineligible individuals and families that are
			 determined to exceed the error rate permitted under that section (as determined
			 without regard to the error rate determined under clause (i)(II)).
							(2)State options
			 for applicationA State selected to participate in the
			 demonstration program may elect to apply any of the following:
						(A)Satisfaction of
			 CHIP screen and enroll requirementsIf the State relies on a
			 finding of an Express Lane agency for purposes of determining eligibility under
			 the State CHIP plan, the State may meet the screen and enroll requirements
			 imposed under subparagraphs (A) and (B) of section 2102(b)(3) of the Social
			 Security Act (42 U.S.C. 1397bb(b)(3)) by using any of the following:
							(i)Establishing a
			 threshold percentage of the poverty line that is 30 percentage points (or such
			 other higher number of percentage points) as the State determines reflects the
			 income methodologies of the program administered by the Express Lane Agency and
			 the State Medicaid plan.
							(ii)Providing that a
			 child satisfies all income requirements for eligibility under the State
			 Medicaid plan.
							(iii)Providing that a
			 child has a family income that exceeds the Medicaid applicable income
			 level.
							(B)Presumptive
			 eligibilityThe State may provide for presumptive eligibility
			 under the State CHIP plan for a child who, based on an eligibility
			 determination of an income finding from an Express Lane agency, would qualify
			 for child health assistance under the State CHIP plan. During the period of
			 presumptive eligibility, the State may determine the child’s eligibility for
			 child health assistance under the State CHIP plan based on telephone contact
			 with family members, access to data available in electronic or paper format, or
			 other means that minimize to the maximum extent feasible the burden on the
			 family.
						(C)Automatic
			 enrollment
							(i)In
			 generalThe State may initiate and determine eligibility for
			 medical assistance under the State Medicaid plan or for child health assistance
			 under the State CHIP plan without a program application from, or on behalf of,
			 the child based on data obtained from sources other than the child (or the
			 child’s family), but a child can only be automatically enrolled in the State
			 Medicaid plan or the State CHIP plan if the child or the family affirmatively
			 consents to being enrolled through affirmation and signature on an Express Lane
			 agency application.
							(ii)Information
			 requirementA State that elects the option under clause (i) shall
			 have procedures in place to inform the child or the child's family of the
			 services that will be covered under the State Medicaid plan or the State CHIP
			 plan (as applicable), appropriate methods for using such services, premium or
			 other cost sharing charges (if any) that apply, medical support obligations
			 created by the enrollment (if applicable), and the actions the child or the
			 child's family must take to maintain enrollment and renew coverage.
							(iii)Option to
			 waive signaturesThe State may waive any signature requirements
			 for enrollment for a child who consents to, or on whose behalf consent is
			 provided for, enrollment in the State Medicaid plan or the State CHIP
			 plan.
							(3)Signature
			 requirementsIn the case of a State selected to participate in
			 the demonstration program—
						(A)no signature under
			 penalty of perjury shall be required on an application form for medical
			 assistance under the State Medicaid plan or child health assistance under the
			 State CHIP plan to attest to any element of the application for which
			 eligibility is based on information received from an Express Lane agency or a
			 source other than an applicant; and
						(B)any signature
			 requirement for determination of an application for medical assistance under
			 the State Medicaid plan or child health assistance under the State CHIP plan
			 may be satisfied through an electronic signature.
						(4)Rules of
			 constructionNothing in this subsection shall be construed
			 to—
						(A)relieve a State of
			 the obligation under section 1902(a)(5) of the Social Security Act (42 U.S.C.
			 1396a(a)(5)) to determine eligibility for medical assistance under the State
			 Medicaid plan; or
						(B)prohibit any State
			 options otherwise permitted under Federal law (without regard to this paragraph
			 or the demonstration program established under this section) that are intended
			 to increase the enrollment of eligible children for medical assistance under
			 the State Medicaid plan or child health assistance under the State CHIP plan,
			 including options related to outreach, enrollment, applications, or the
			 determination or redetermination of eligibility.
						(c)Limited waiver
			 of other applicable requirements
					(1)Social Security
			 ActThe Secretary shall waive only such requirements of the
			 Social Security Act as the Secretary determines are necessary to carry out the
			 demonstration program established under this section.
					(2)Authorization
			 for participating States to receive certain data directly relevant to
			 determining eligibility and correct amount of assistanceFor
			 provisions relating to the authority of States participating in the
			 demonstration program to receive certain data directly, see section
			 204(c).
					(d)Evaluation and
			 Report
					(1)EvaluationThe
			 Secretary shall conduct, by grant, contract, or interagency agreement, a
			 comprehensive, independent evaluation of the demonstration program established
			 under this section. Such evaluation shall include an analysis of the
			 effectiveness of the program, and shall include—
						(A)obtaining a
			 statistically valid sample of the children who were enrolled in the State
			 Medicaid plan or the State CHIP plan through reliance on a finding made by an
			 Express Lane agency and determining the percentage of children who were
			 erroneously enrolled in such plans;
						(B)determining whether
			 enrolling children in such plans through reliance on a finding made by an
			 Express Lane agency improves the ability of a State to identify and enroll
			 low-income, uninsured children who are eligible but not enrolled in such
			 plans;
						(C)evaluating the
			 administrative costs or savings related to identifying and enrolling children
			 in such plans through reliance on such findings, and the extent to which such
			 costs differ from the costs that the State otherwise would have incurred to
			 identify and enroll low-income, uninsured children who are eligible but not
			 enrolled in such plans; and
						(D)any
			 recommendations for legislative or administrative changes that would improve
			 the effectiveness of enrolling children in such plans through reliance on such
			 findings.
						(2)Report to
			 congressNot later than September 30, 2012, the Secretary shall
			 submit a report to Congress on the results of the evaluation of the
			 demonstration program established under this section.
					(e)DefinitionsIn
			 this section:
					(1)Child;
			 childrenWith respect to a State selected to participate in the
			 demonstration program established under this section, the terms
			 child and children have the meanings given such terms
			 for purposes of the State plans under titles XIX and XXI of the Social Security
			 Act.
					(2)Express lane
			 agency
						(A)In
			 generalThe term Express Lane agency means a public
			 agency that—
							(i)is
			 determined by the State Medicaid agency or the State CHIP agency (as
			 applicable) to be capable of making the determinations of 1 or more eligibility
			 requirements described in subsection (a)(1);
							(ii)is
			 identified in the State Medicaid plan or the State CHIP plan; and
							(iii)notifies the
			 child's family—
								(I)of the information
			 which shall be disclosed in accordance with this section;
								(II)that the
			 information disclosed will be used solely for purposes of determining
			 eligibility for medical assistance under the State Medicaid plan or for child
			 health assistance under the State CHIP plan; and
								(III)that the family
			 may elect to not have the information disclosed for such purposes; and
								(iv)enters into, or is
			 subject to, an interagency agreement to limit the disclosure and use of the
			 information disclosed.
							(B)Inclusion of
			 specific public agenciesSuch term includes the following:
							(i)A
			 public agency that determines eligibility for assistance under any of the
			 following:
								(I)The temporary
			 assistance for needy families program funded under part A of title IV of the
			 Social Security Act (42 U.S.C. 601 et seq.).
								(II)A State program
			 funded under part D of title IV of such Act (42 U.S.C. 651 et seq.).
								(III)The State
			 Medicaid plan.
								(IV)The State CHIP
			 plan.
								(V)The Food Stamp Act
			 of 1977 (7 U.S.C. 2011 et seq.).
								(VI)The Head Start Act
			 (42 U.S.C. 9801 et seq.).
								(VII)The Richard B.
			 Russell National School Lunch Act (42 U.S.C. 1751 et seq.).
								(VIII)The Child
			 Nutrition Act of 1966 (42 U.S.C. 1771 et seq.).
								(IX)The Child Care
			 and Development Block Grant Act of 1990 (42 U.S.C. 9858 et seq.).
								(X)The
			 Stewart B. McKinney Homeless Assistance Act (42 U.S.C. 11301 et seq.).
								(XI)The United States
			 Housing Act of 1937 (42 U.S.C. 1437 et seq.).
								(XII)The Native
			 American Housing Assistance and Self-Determination Act of 1996 (25 U.S.C. 4101
			 et seq.).
								(ii)A
			 State-specified governmental agency that has fiscal liability or legal
			 responsibility for the accuracy of the eligibility determination findings
			 relied on by the State.
							(iii)A
			 public agency that is subject to an interagency agreement limiting the
			 disclosure and use of the information disclosed for purposes of determining
			 eligibility under the State Medicaid plan or the State CHIP plan.
							(C)ExclusionsSuch
			 term does not include an agency that determines eligibility for a program
			 established under the Social Services Block Grant established under title XX of
			 the Social Security Act (42 U.S.C. 1397 et seq.) or a private, for-profit
			 organization.
						(D)Rules of
			 constructionNothing in this paragraph shall be construed
			 as—
							(i)affecting the
			 authority of a State Medicaid agency to enter into contracts with nonprofit and
			 for-profit agencies to administer the Medicaid application process;
							(ii)exempting a State
			 Medicaid agency from complying with the requirements of section 1902(a)(4) of
			 the Social Security Act (relating to merit-based personnel standards for
			 employees of the State Medicaid agency and safeguards against conflicts of
			 interest); or
							(iii)authorizing a
			 State Medicaid agency that participates in the demonstration program
			 established under this section to use the Express Lane option to avoid
			 complying with such requirements for purposes of making eligibility
			 determinations under the State Medicaid plan.
							(3)Medicaid
			 applicable income levelWith respect to a State, the term
			 Medicaid applicable income level has the meaning given that term
			 for purposes of such State under section 2110(b)(4) of the Social Security Act
			 (42 U.S.C. 1397jj(4)).
					(4)Poverty
			 lineThe term poverty line has the meaning given
			 that term in section 2110(c)(5) of the Social Security Act (42 U.S.C.
			 1397jj(c)(5)).
					(5)StateThe
			 term State means 1 of the 50 States or the District of
			 Columbia.
					(6)State CHIP
			 agencyThe term State CHIP agency means the State
			 agency responsible for administering the State CHIP plan.
					(7)State CHIP
			 planThe term State CHIP plan means the State child
			 health plan established under title XXI of the Social Security Act (42 U.S.C.
			 1397aa et seq.), and includes any waiver of such plan.
					(8)State Medicaid
			 agencyThe term State Medicaid agency means the
			 State agency responsible for administering the State Medicaid plan.
					(9)State Medicaid
			 planThe term State Medicaid plan means the State
			 plan established under title XIX of the Social Security Act (42 U.S.C. 1396 et
			 seq.), and includes any waiver of such plan.
					(f)Appropriation
					(1)Operational
			 fundsOut of any funds in the Treasury not otherwise
			 appropriated, there is appropriated to the Secretary to carry out the
			 demonstration program established under this section, $49,000,000 for the
			 period of fiscal years 2008 through 2012.
					(2)Evaluation
			 funds$5,000,000 of the funds appropriated under paragraph (1)
			 shall be used to conduct the evaluation required under subsection (d).
					(3)Budget
			 authorityParagraph (1) constitutes budget authority in advance
			 of appropriations Act and represents the obligation of the Federal Government
			 to provide for the payment to States selected to participate in the
			 demonstration program established under this section of the amounts provided
			 under such paragraph (after the application of paragraph (2)).
					204.Authorization
			 of certain information disclosures to simplify health coverage
			 determinations
				(a)Authorization of
			 information disclosureTitle XIX (42 U.S.C. 1396 et seq.) is
			 amended—
					(1)by redesignating
			 section 1939 as section 1940; and
					(2)by inserting after
			 section 1938 the following new section:

							1939.Authorization to receive pertinent
		  information(a)In
				generalNotwithstanding any other provision of law, a Federal or
				State agency or private entity in possession of the sources of data directly
				relevant to eligibility determinations under this title (including eligibility
				files, information described in paragraph (2) or (3) of section 1137(a), vital
				records information about births in any State, and information described in
				sections 453(i) and 1902(a)(25)(I)) is authorized to convey such data or
				information to the State agency administering the State plan under this title,
				but only if such conveyance meets the requirements of subsection (b).
								(b)Requirements for
				conveyanceData or information may be conveyed pursuant to this
				section only if the following requirements are met:
									(1)The child whose
				circumstances are described in the data or information (or such child’s parent,
				guardian, caretaker relative, or authorized representative) has either provided
				advance consent to disclosure or has not objected to disclosure 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
				children who are eligible or potentially eligible for medical assistance under
				this title and enrolling (or attempting to enroll) such children in the State
				plan; and
										(B)verifying the
				eligibility of children for medical assistance under the State plan.
										(3)An interagency or
				other agreement, consistent with standards developed by the Secretary—
										(A)prevents the
				unauthorized use, disclosure, or modification of such data and otherwise meets
				applicable Federal requirements for safeguarding privacy and data security;
				and
										(B)requires the State
				agency administering the State plan to use the data and information obtained
				under this section to seek to enroll children in the plan.
										(c)Criminal
				penaltyA person described in 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 activity.
								(d)Rule of
				constructionThe limitations and requirements that apply to
				disclosure pursuant to this section shall not be construed to prohibit the
				conveyance or disclosure of data or information otherwise permitted under
				Federal law (without regard to this
				section).
								.
					(b)Conforming
			 amendment to title XXISection 2107(e)(1) (42 U.S.C.
			 1397gg(e)(1)) is amended by adding at the end the following new
			 subparagraph:

						(E)Section 1939
				(relating to authorization to receive data directly relevant to eligibility
				determinations).
						.
				(c)Authorization
			 for States participating in the Express Lane demonstration program To receive
			 certain data directly relevant To determining eligibility and correct amount of
			 assistanceOnly in the case of a State selected to participate in
			 the Express Lane demonstration program established under section 203, the
			 Secretary shall enter into such agreements as are necessary to permit such a
			 State to receive data directly relevant to eligibility determinations and
			 determining the correct amount of benefits under the State CHIP plan or the
			 State Medicaid plan (as such terms are defined in paragraphs (7) and (9)
			 section 203(e)) from the following:
					(1)The National
			 Directory of New Hires established under section 453(i) of the Social Security
			 Act (42 U.S.C. 653(i)).
					(2)The National
			 Income Data collected by the Commissioner of Social Security from information
			 described in subparagraphs (A) and (B) of section 6103(l)(7) of the Internal
			 Revenue Code of 1986, in accordance with the requirements of that
			 section.
					(3)Data regarding
			 enrollment in insurance that may help to facilitate outreach and enrollment
			 under the State Medicaid plan, the State CHIP plan, and such other programs as
			 the Secretary may specify.
					IIIReducing
			 Barriers to Enrollment
			301.Verification of
			 declaration of citizenship or nationality for purposes of eligibility for
			 Medicaid and CHIP
				(a)State option To
			 verify declaration of citizenship or nationality for purposes of eligibility
			 for Medicaid through verification of name and social security number
					(1)Alternative to
			 documentation requirement
						(A)In
			 generalSection 1902 (42 U.S.C. 1396a) is amended—
							(i)in
			 subsection (a)(46)—
								(I)by inserting
			 (A) after (46);
								(II)by adding
			 and after the semicolon; and
								(III)by adding at the
			 end the following new subparagraph:

										(B)provide, with respect to an individual
				declaring to be a citizen or national of the United States for purposes of
				establishing eligibility under this title, that the State shall satisfy the
				requirements of—
											(i)section 1903(x); or
											(ii)subsection
				(dd);
											;
				and
								(ii)by
			 adding at the end the following new subsection:

									(dd)(1)For purposes of section
				1902(a)(46)(B)(ii), the requirements of this subsection with respect to an
				individual declaring to be a citizen or national of the United States for
				purposes of establishing eligibility under this title, are, in lieu of
				requiring the individual to present satisfactory documentary evidence of
				citizenship or nationality under section 1903(x) (if the individual is not
				described in paragraph (2) of that section), as follows:
											(A)The State submits the name and social
				security number of the individual to the Commissioner of Social Security as
				part of the plan established under paragraph (2).
											(B)If the State receives notice from the
				Commissioner of Social Security that the name or social security number of the
				individual is invalid, the State—
												(i)notifies the individual of such
				fact;
												(ii)provides the individual with an
				opportunity to cure the invalid determination with the Commissioner of Social
				Security, followed by a period of 90 days from the date on which the notice
				required under clause (i) is received by the individual to present satisfactory
				documentary evidence of citizenship or nationality (as defined in section
				1903(x)(3)); and
												(iii)disenrolls the individual from
				the State plan under this title within 30 days after the end of such 90-day
				period if no such documentary evidence is presented.
												(2)(A)Each State electing to
				satisfy the requirements of this subsection for purposes of section
				1902(a)(46)(B) shall establish a program under which the State submits each
				month to the Commissioner of Social Security for verification the name and
				social security number of each individual enrolled in the State plan under this
				title that month who has attained the age of 1 before the date of the
				enrollment.
											(B)In establishing the State program
				under this paragraph, the State may enter into an agreement with the
				Commissioner of Social Security to provide for the electronic submission and
				verification of the name and social security number of an individual before the
				individual is enrolled in the State plan.
											(3)(A)The State agency
				implementing the plan approved under this title shall, at such times and in
				such form as the Secretary may specify, provide information on the percentage
				each month that the invalid names and numbers submitted bears to the total
				submitted for verification.
											(B)If, for any fiscal year, the average
				monthly percentage determined under subparagraph (A) is greater than 7
				percent—
												(i)the State shall develop and adopt a
				corrective plan to review its procedures for verifying the identities of
				individuals seeking to enroll in the State plan under this title and to
				identify and implement changes in such procedures to improve their accuracy;
				and
												(ii)pay to the Secretary an amount equal
				to the amount which bears the same ratio to the total payments under the State
				plan for the fiscal year for providing medical assistance to individuals who
				provided invalid information as the number of individuals with invalid
				information in excess of 7 percent of such total submitted bears to the total
				number of individuals with invalid information.
												(C)The Secretary may waive, in certain
				limited cases, all or part of the payment under subparagraph (B)(ii) if the
				State is unable to reach the allowable error rate despite a good faith effort
				by such State.
											(D)This paragraph shall not apply to a
				State for a fiscal year if there is an agreement described in paragraph (2)(B)
				in effect as of the close of the fiscal year.
											(4)Nothing in this subsection shall
				affect the rights of any individual under this title to appeal any
				disenrollment from a State
				plan.
										.
							(B)Costs of
			 implementing and maintaining systemSection 1903(a)(3) (42 U.S.C.
			 1396b(a)(3)) is amended—
							(i)by
			 striking plus at the end of subparagraph (E) and inserting
			 and, and
							(ii)by
			 adding at the end the following new subparagraph:

									(F)(i)90 percent of the sums
				expended during the quarter as are attributable to the design, development, or
				installation of such mechanized verification and information retrieval systems
				as the Secretary determines are necessary to implement section 1902(dd)
				(including a system described in paragraph (2)(B) thereof), and
										(ii)75 percent of the sums expended
				during the quarter as are attributable to the operation of systems to which
				clause (i) applies,
				plus
										.
							(2)Limitation on
			 waiver authorityNotwithstanding any provision of section 1115 of
			 the Social Security Act (42 U.S.C. 1315), or any other provision of law, the
			 Secretary may not waive the requirements of section 1902(a)(46)(B) of such Act
			 (42 U.S.C. 1396a(a)(46)(B)) with respect to a State.
					(3)Conforming
			 amendmentsSection 1903 (42 U.S.C. 1396b) is amended—
						(A)in subsection
			 (i)(22), by striking subsection (x) and inserting section
			 1902(a)(46)(B); and
						(B)in subsection
			 (x)(1), by striking subsection (i)(22) and inserting
			 section 1902(a)(46)(B)(i).
						(b)Clarification of
			 requirements relating to presentation of satisfactory documentary evidence of
			 citizenship or nationality
					(1)Acceptance of
			 documentary evidence issued by a federally recognized Indian
			 tribeSection 1903(x)(3)(B) (42 U.S.C. 1396b(x)(3)(B)) is
			 amended—
						(A)by redesignating
			 clause (v) as clause (vi); and
						(B)by inserting after
			 clause (iv), the following new clause:

								(v)(I)Except as provided in
				subclause (II), a document issued by a federally recognized Indian tribe
				evidencing membership or enrollment in, or affiliation with, such tribe (such
				as a tribal enrollment card or certificate of degree of Indian blood).
									(II)With respect to those federally
				recognized Indian tribes located within States having an international border
				whose membership includes individuals who are not citizens of the United
				States, the Secretary shall, after consulting with such tribes, issue
				regulations authorizing the presentation of such other forms of documentation
				(including tribal documentation, if appropriate) that the Secretary determines
				to be satisfactory documentary evidence of citizenship or nationality for
				purposes of satisfying the requirement of this
				subsection.
									.
						(2)Requirement to
			 provide reasonable opportunity to present satisfactory documentary
			 evidenceSection 1903(x) (42 U.S.C. 1396b(x)) is amended by
			 adding at the end the following new paragraph:

							(4)In the case of an individual
				declaring to be a citizen or national of the United States with respect to whom
				a State requires the presentation of satisfactory documentary evidence of
				citizenship or nationality under section 1902(a)(46)(B)(i), the individual
				shall be provided at least the reasonable opportunity to present satisfactory
				documentary evidence of citizenship or nationality under this subsection as is
				provided under clauses (i) and (ii) of section 1137(d)(4)(A) to an individual
				for the submittal to the State of evidence indicating a satisfactory
				immigration
				status.
							.
					(3)Children born in
			 the United States to mothers eligible for Medicaid
						(A)Clarification of
			 rulesSection 1903(x) (42
			 U.S.C. 1396b(x)), as amended by paragraph (2), is amended—
							(i)in
			 paragraph (2)—
								(I)in subparagraph
			 (C), by striking or at the end;
								(II)by
			 redesignating subparagraph (D) as subparagraph (E); and
								(III)by inserting
			 after subparagraph (C) the following new subparagraph:

										(D)pursuant to the application of section
				1902(e)(4) (and, in the case of an individual who is eligible for medical
				assistance on such basis, the individual shall be deemed to have provided
				satisfactory documentary evidence of citizenship or nationality and shall not
				be required to provide further documentary evidence on any date that occurs
				during or after the period in which the individual is eligible for medical
				assistance on such basis); or
										;
				and
								(ii)by adding at the end the following new
			 paragraph:

									(5)Nothing in subparagraph (A) or (B) of
				section 1902(a)(46), the preceding paragraphs of this subsection, or the
				Deficit Reduction Act of 2005, including section 6036 of such Act, shall be
				construed as changing the requirement of section 1902(e)(4) that a child born
				in the United States to an alien mother for whom medical assistance for the
				delivery of such child is available as treatment of an emergency medical
				condition pursuant to subsection (v) shall be deemed eligible for medical
				assistance during the first year of such child’s
				life.
									.
							(B)State
			 requirement to issue separate identification numberSection
			 1902(e)(4) (42 U.S.C. 1396a(e)(4)) is amended by adding at the end the
			 following new sentence: Notwithstanding the preceding sentence, in the
			 case of a child who is born in the United States to an alien mother for whom
			 medical assistance for the delivery of the child is made available pursuant to
			 section 1903(v), the State immediately shall issue a separate identification
			 number for the child upon notification by the facility at which such delivery
			 occurred of the child's birth..
						(4)Technical
			 amendmentsSection 1903(x)(2) (42 U.S.C. 1396b(x)) is
			 amended—
						(A)in subparagraph
			 (B)—
							(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; and
							(B)in subparagraph
			 (C)—
							(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
			 generalSection 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 requirements
								(A)In
				generalNo payment may be made under this section with respect to
				an individual who has, or is, declared to be a citizen or national of the
				United States for purposes of establishing eligibility under this title unless
				the State meets the requirements of section 1902(a)(46)(B) with respect to the
				individual.
								(B)Enhanced
				paymentsNotwithstanding 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 subparagraph (A)
				shall in no event be less than 90 percent and 75 percent,
				respectively.
								.
					(2)Nonapplication
			 of administrative expenditures capSection 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
				requirementsExpenditures necessary for the State to comply with
				paragraph
				(9)(A).
							.
					(d)Effective
			 date
					(1)In
			 generalThe amendments made by this section shall take effect on
			 October 1, 2008.
					(2)Restoration of
			 eligibilityIn 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 Social Security Act (as in effect during
			 such period), but who would have been determined eligible for such assistance
			 if such subsections, as amended by subsection (b), had applied to the
			 individual, a State may deem the individual to be eligible for such assistance
			 as of the date that the individual was determined to be ineligible for such
			 medical assistance on such basis.
					(3)Special
			 transition rule for indiansDuring 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 described 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 requirement of subsection (x) of section 1903 of such Act.
					302.Reducing
			 administrative barriers to enrollmentSection 2102(b) (42 U.S.C. 1397bb(b)) is
			 amended—
				(1)by redesignating
			 paragraph (4) as paragraph (5); and
				(2)by inserting after
			 paragraph (3) the following new paragraph:

						(4)Reduction of
				administrative barriers to enrollment
							(A)In
				generalSubject to subparagraph (B), the plan shall include a
				description of the procedures used to reduce administrative barriers to the
				enrollment of children and pregnant women who are eligible for medical
				assistance under title XIX or for child health assistance or health benefits
				coverage under this title. Such procedures shall be established and revised as
				often as the State determines appropriate to take into account the most recent
				information available to the State identifying such barriers.
							(B)Deemed
				compliance if joint application and renewal process that permits application
				other than in personA State shall be deemed to comply with
				subparagraph (A) if the State's application and renewal forms and supplemental
				forms (if any) and information verification process is the same for purposes of
				establishing and renewing eligibility for children and pregnant women for
				medical assistance under title XIX and child health assistance under this
				title, and such process does not require an application to be made in person or
				a face-to-face
				interview.
							.
				IVReducing barriers
			 to providing premium assistance
			AAdditional State
			 option for providing premium assistance
				401.Additional
			 State option for providing premium assistance
					(a)In
			 generalSection 2105(c) (42 U.S.C. 1397ee(c)), as amended by
			 section 301(c), is amended by adding at the end the following:

							(10)State option to
				offer premium assistance
								(A)In
				generalSubject to the succeeding 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
				subparagraph (B)) to all targeted low-income children 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
				generalSubject to clauses (ii) and (iii), in this paragraph, the
				term qualified employer-sponsored coverage means a group health
				plan or health insurance 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;
										(II)for which the
				employer contribution 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 classification for purposes of paragraph (3)(A)(ii) of section
				105(h) of the Internal Revenue Code of 1986 (but determined without regard to
				clause (i) of subparagraph (B) of such paragraph).
										(ii)ExceptionSuch
				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 defined under section 223(d) of
				such Code).
										(iii)Cost-effectiveness
				alternative to required employer contributionA group health plan
				or health insurance coverage offered through an employer that would be
				considered qualified employer-sponsored coverage but for the application of
				clause (i)(II) may be deemed to satisfy the requirement of such clause if
				either of the following applies:
										(I)Application of child-based or family-based
				testThe State establishes to
				the satisfaction of the Secretary that the cost of such coverage 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 planIf subclause (I) does not apply, the
				State establishes to the satisfaction of the Secretary that the aggregate
				amount of expenditures by the State for the purchase of all such coverage for
				targeted low-income children under the State child health plan (including
				administrative expenditures) does not exceed the aggregate amount of
				expenditures 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
				generalIn this paragraph, the term premium assistance
				subsidy means, with respect to a targeted low-income child, the amount
				equal to the difference 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 imposed under section
				2103(e), including the requirement to count the total amount of the employee
				contribution required for enrollment of the employee and the child in such
				coverage toward the annual aggregate cost-sharing limit applied under paragraph
				(3)(B) of such section).
									(ii)State payment
				optionA State may provide a premium assistance subsidy either as
				reimbursement to an employee for out-of-pocket expenditures or, subject to
				clause (iii), directly to the employee's employer.
									(iii)Employer
				opt-outAn employer 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 employer shall withhold the total
				amount of the employee contribution required for enrollment of the employee and
				the child in the qualified employer-sponsored coverage and the State shall pay
				the premium assistance subsidy directly to the employee.
									(iv)Treatment as
				child health assistanceExpenditures for the provision of premium
				assistance subsidies shall be considered child health assistance described in
				paragraph (1)(C) of subsection (a) for purposes of making payments under that
				subsection.
									(D)Application of secondary payor
				rulesThe 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 supplemental coverage for benefits and cost-sharing protection provided
				under the state child health plan
									(i)In
				generalNotwithstanding section 2110(b)(1)(C), the State shall
				provide for each targeted low-income child enrolled in qualified
				employer-sponsored coverage, 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 consistent with section 2103(e).
										(ii)Record keeping
				requirementsFor purposes of carrying out clause (i), a State may
				elect to directly pay out-of-pocket expenditures for cost-sharing imposed under
				the qualified employer-sponsored coverage and collect or not collect all or any
				portion of such expenditures from the parent of the child.
									(F)Application of
				waiting period imposed under the StateAny 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 monthA 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
				continuity of coverage for the child.
								(H)Application to
				parentsIf a State provides child health assistance or health
				benefits coverage to parents of a targeted low-income 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 assistance 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 providing premium assistance
									(i)In
				generalA State may establish an employer-family premium
				assistance purchasing pool for employers with less than 250 employees who have
				at least 1 employee 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 coverageA State that elects the option under clause (i) shall
				identify and offer access 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 section 2103(b) or benchmark-equivalent
				coverage that meets the requirements of section 2103(a)(2) for employees
				described in clause (i).
									(J)No effect on
				previously approved premium assistance programsNothing 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 enactment of the Children's Health Insurance Program Reauthorization Act of
				2007.
								(K)Notice of
				availabilityIf a State elects to provide premium assistance
				subsidies in accordance with this paragraph, the State shall—
									(i)include on any
				application or enrollment form for child health assistance a notice of the
				availability of premium assistance subsidies for the enrollment of targeted
				low-income children in qualified employer-sponsored coverage;
									(ii)provide, as part
				of the application 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
									(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 employer-sponsored benchmark coverageIf a group health
				plan or health insurance coverage offered through an employer is certified by
				an actuary as health benefits coverage that is equivalent to the benefits
				coverage in a benchmark benefit package described in section 2103(b) or
				benchmark-equivalent coverage that meets the requirements of section
				2103(a)(2), the State may provide premium assistance subsidies for enrollment
				of targeted low-income children in such group health plan or health insurance
				coverage in the same manner as such subsidies are provided under this paragraph
				for enrollment in qualified employer-sponsored coverage, but without regard to
				the requirement to provide supplemental coverage for benefits and cost-sharing
				protection provided under the State child health plan under subparagraph
				(E).
								.
					(b)Application to
			 MedicaidSection 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 assistance 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 accordance 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
			 reportNot later than January
			 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.
					402.Outreach,
			 education, and enrollment assistance
					(a)Requirement To
			 include description of outreach, education, and enrollment efforts related to
			 premium assistance subsidies in state child health planSection 2102(c) (42 U.S.C. 1397bb(c)) is
			 amended by adding at the end the following new paragraph:

							(3)Premium
				assistance subsidiesOutreach, education, and enrollment
				assistance for families of children likely to be eligible for premium
				assistance 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
				specific, significant resources the State intends to apply to educate employers
				about the availability of premium assistance subsidies under the State child
				health
				plan.
							.
					(b)Nonapplication
			 of 10 percent limit on outreach and certain other
			 expendituresSection 2105(c)(2)(C) (42 U.S.C. 1397ee(c)(2)(C)),
			 as amended by section 301(c)(2), is amended by adding at the end the following
			 new clause:

							(iv)Expenditures
				for outreach to increase the enrollment of children under this title and title
				XIX through premium assistance subsidiesExpenditures for
				outreach activities to families of children likely to be eligible for premium
				assistance subsidies in accordance with paragraphs (2)(B), (3), or (10), 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 to
				employers likely to provide qualified employer-sponsored coverage (as defined
				in subparagraph (B) of such
				paragraph).
							.
					BCoordinating
			 Premium Assistance With Private Coverage
				411.Special
			 enrollment period under group health plans in case of termination of Medicaid
			 or CHIP coverage or eligibility for assistance in purchase of employment-based
			 coverage; coordination of coverage
					(a)Amendments to
			 Internal Revenue Code of 1986Section 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
				generalA 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 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 coverageThe employee or dependent 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
				employee 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 termination of such
				coverage.
									(ii)Eligibility for
				employment assistance under Medicaid or CHIPThe 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 demonstration 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 employee or dependent is
				determined to be eligible for such assistance.
									(B)Employee
				outreach and disclosure
									(i)Outreach to
				employees regarding availability of Medicaid and CHIP coverage
										(I)In
				generalEach employer that
				maintains a group health plan in a State that provides medical assistance under
				a State Medicaid plan under title XIX of the Social Security 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 written notice informing the
				employee of potential opportunities then currently available in the State in
				which the employee resides for premium assistance under such plans for health
				coverage of the employee or the employee's dependents. For purposes of
				compliance with this clause, the employer may use any State-specific model
				notice issued by the Secretary of Labor or the Secretary of Health and Human
				Services in accordance with section 701(f)(3)(B) of the Employee Retirement
				Income Security Act of 1974 (29 U.S.C. 1181(f)(3)(B)).
										(II)Option to
				provide concurrent with provision of summary plan descriptionAn
				employer may provide the model notice applicable to the State in which an
				employee resides concurrent with the furnishing of the summary plan description
				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
				individualsIn the case of a participant or beneficiary of 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 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 coverage coordination disclosure form developed
				under section 411(b)(2)(C) of the Children's
				Health Insurance Program 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 medical or child health assistance
				through premium assistance for the purchase of coverage 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.
									.
					(b)Conforming
			 amendments
						(1)Amendments to
			 Employee Retirement Income Security Act
							(A)In
			 generalSection 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:

									(3)Special rules for
				application in case of Medicaid and CHIP
										(A)In
				generalA 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 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 coverageThe employee or dependent 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
				employee 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 CHIPThe employee or
				dependent becomes eligible for assistance, with respect to coverage under the
				group health plan or health insurance coverage, under such Medicaid plan or
				State child health plan (including under any waiver or demonstration project
				conducted under or in relation to such a plan), if the employee requests
				coverage under the group health plan or health insurance coverage 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 regarding availability of Medicaid and CHIP coverage
											(I)In
				generalEach employer that
				maintains a group health plan in a State that provides medical assistance under
				a State Medicaid plan under title XIX of the Social Security 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 written notice informing the
				employee of potential opportunities then currently available in the State in
				which the employee resides for premium assistance under such plans for health
				coverage of the employee or the employee's dependents.
											(II)Model
				noticeNot 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 consultation with Directors of State Medicaid
				agencies under title XIX of the Social Security Act and Directors of State CHIP
				agencies under title XXI of such Act, shall jointly develop national and
				State-specific model notices for purposes of subparagraph (A). The Secretary
				shall provide employers with such model notices so as to enable employers to
				timely comply with the requirements of subparagraph (A). Such model notices
				shall include information regarding how an employee may contact the State in
				which the employee resides for additional information regarding potential
				opportunities for such premium assistance, including how to apply for such
				assistance.
											(III)Option to
				provide concurrent with provision of summary plan descriptionAn
				employer may provide the model notice applicable to the State in which an
				employee resides concurrent with the furnishing of the summary plan description
				as provided in section 104(b).
											(ii)Disclosure
				about group health plan benefits to States for Medicaid and CHIP eligible
				individualsIn the case of a participant or beneficiary of 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 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 coverage coordination disclosure form developed
				under section 411(b)(2)(C) of the Children's
				Health Insurance Program 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 medical or child health assistance
				through premium assistance for the purchase of coverage 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.
										.
							(B)Conforming
			 amendmentSection 102(b) of the Employee Retirement Income
			 Security 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
			 generalNot 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 Medicaid, CHIP, and Employer-Sponsored Coverage
			 Coordination Working Group (in this subparagraph referred to as the
			 Working Group). The purpose of the Working Group shall be to
			 develop the model coverage coordination disclosure form described in subclause
			 (II) and to identify the impediments to the effective coordination of coverage
			 available to families that include employees of employers that maintain group
			 health plans and members who are eligible for medical assistance under title
			 XIX of the Social Security Act or child health assistance or other health
			 benefits coverage under title XXI of such Act.
									(II)Model coverage
			 coordination disclosure form describedThe model form described
			 in this subclause is a form for plan administrators of group health plans to
			 complete for purposes of permitting a State to determine the availability and
			 cost-effectiveness of the coverage available under such plans to employees who
			 have family members who are eligible for premium assistance offered under a
			 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
			 determines 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 administrator 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)MembershipThe
			 Working Group shall consist of not more than 30 members and shall be composed
			 of representatives of—
									(I)the Department of
			 Labor;
									(II)the Department of
			 Health and Human Services;
									(III)State directors
			 of the Medicaid 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 professionals;
									(VI)plan
			 administrators and plan sponsors of group health plans (as defined in section
			 607(1) of the Employee Retirement Income Security Act of 1974); and
									(VII)children and
			 other beneficiaries of medical assistance under title XIX of the Social
			 Security Act or child health assistance or other health benefits coverage under
			 title XXI of such Act.
									(iii)CompensationThe
			 members of the Working Group shall serve without compensation.
								(iv)Administrative
			 supportThe Department of Health and Human Services and the
			 Department of Labor shall jointly provide appropriate administrative support to
			 the Working Group, including technical assistance. The Working Group may use
			 the services and facilities of either such Department, with or without
			 reimbursement, as jointly determined by such Departments.
								(v)Report
									(I)Report by
			 working group to the secretariesNot later than 18 months after
			 the date of the enactment of this Act, the Working Group shall submit to the
			 Secretary of Labor and the Secretary of Health and Human Services the model
			 form described in clause (i)(II) along with a report containing recommendations
			 for appropriate measures to address the impediments to the effective
			 coordination 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 congressNot later than 2 months after receipt
			 of the report pursuant to subclause (I), the Secretaries shall jointly submit a
			 report to each House of the Congress regarding the recommendations contained in
			 the report under such subclause.
									(vi)TerminationThe
			 Working Group shall terminate 30 days after the date of the issuance of its
			 report under clause (v).
								(D)Effective
			 datesThe 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 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 beginning with the first plan year that begins after
			 the date on which such model coverage coordination disclosure form is first
			 issued.
							(E)EnforcementSection
			 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 subparagraph, each violation with
				respect to any single employee shall be treated as a separate violation.
											(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
				beneficiary shall be treated as a separate
				violation.
											.
								VStrengthening
			 Quality of Care and Health Outcomes of Children
			501.Child health
			 quality improvement activities for children enrolled in Medicaid or
			 CHIP
				(a)Development of
			 child health quality measures for children enrolled in medicaid or
			 chipTitle XI (42 U.S.C. 1301 et seq.) is amended by inserting
			 after section 1139 the following new section:

						1139A.Child health
				quality measures
							(a)Development of
				an initial core set of health care quality measures for children enrolled in
				medicaid or chip
								(1)In
				generalNot later than January 1, 2009, the Secretary shall
				identify and publish for general comment an initial, recommended core set of
				child health quality measures for use by State programs administered under
				titles XIX and XXI, health insurance issuers and managed care entities that
				enter into contracts with such programs, and providers of items and services
				under such programs.
								(2)Identification
				of initial core measuresIn consultation with the individuals and
				entities described in subsection (b)(3), the Secretary shall identify existing
				quality of care measures for children that are in use under public and
				privately sponsored health care coverage arrangements, or that are part of
				reporting systems that measure both the presence and duration of health
				insurance coverage over time.
								(3)Recommendations
				and disseminationBased on such existing and identified measures,
				the Secretary shall publish an initial core set of child health quality
				measures that includes (but is not limited to) the following:
									(A)The duration of
				children’s health insurance coverage over a 12-month time period.
									(B)The availability
				of a full range of—
										(i)preventive
				services, treatments, and services for acute conditions, including services to
				promote healthy birth and prevent and treat premature birth; and
										(ii)treatments to
				correct or ameliorate the effects of chronic physical and mental conditions in
				infants, young children, school-age children, and adolescents.
										(C)The availability
				of care in a range of ambulatory and inpatient health care settings in which
				such care is furnished.
									(D)The types of
				measures that, taken together, can be used to estimate the overall national
				quality of health care for children and to perform comparative analyses of
				pediatric health care quality and racial, ethnic, and socioeconomic disparities
				in child health and health care for children.
									(4)Encourage
				voluntary and standardized reportingNot later than 2 years after
				the date of enactment of the Children's
				Health Insurance Program Reauthorization Act of 2007, the
				Secretary, in consultation with States, shall develop a standardized format for
				reporting information and procedures and approaches that encourage States to
				use the initial core measurement set to voluntarily report information
				regarding the quality of pediatric health care under titles XIX and XXI.
								(5)Adoption of best
				practices in implementing quality programsThe Secretary shall
				disseminate information to States regarding best practices among States with
				respect to measuring and reporting on the quality of health care for children,
				and shall facilitate the adoption of such best practices. In developing best
				practices approaches, the Secretary shall give particular attention to State
				measurement techniques that ensure the timeliness and accuracy of provider
				reporting, encourage provider reporting compliance, encourage successful
				quality improvement strategies, and improve efficiency in data collection using
				health information technology.
								(6)Reports to
				congressNot later than January 1, 2010, and every 3 years
				thereafter, the Secretary shall report to Congress on—
									(A)the status of the
				Secretary's efforts to improve—
										(i)quality related to
				the duration and stability of health insurance coverage for children under
				titles XIX and XXI;
										(ii)the quality of
				children's health care under such titles, including preventive health services,
				health care for acute conditions, chronic health care, and health services to
				ameliorate the effects of physical and mental conditions and to aid in growth
				and development of infants, young children, school-age children, and
				adolescents with special health care needs; and
										(iii)the quality of
				children’s health care under such titles across the domains of quality,
				including clinical quality, health care safety, family experience with health
				care, health care in the most integrated setting, and elimination of racial,
				ethnic, and socioeconomic disparities in health and health care;
										(B)the status of
				voluntary reporting by States under titles XIX and XXI, utilizing the initial
				core quality measurement set; and
									(C)any
				recommendations for legislative changes needed to improve the quality of care
				provided to children under titles XIX and XXI, including recommendations for
				quality reporting by States.
									(7)Technical
				assistanceThe Secretary shall provide technical assistance to
				States to assist them in adopting and utilizing core child health quality
				measures in administering the State plans under titles XIX and XXI.
								(8)Definition of
				core setIn this section, the term core set means a
				group of valid, reliable, and evidence-based quality measures that, taken
				together—
									(A)provide information
				regarding the quality of health coverage and health care for children;
									(B)address the needs
				of children throughout the developmental age span; and
									(C)allow purchasers,
				families, and health care providers to understand the quality of care in
				relation to the preventive needs of children, treatments aimed at managing and
				resolving acute conditions, and diagnostic and treatment services whose purpose
				is to correct or ameliorate physical, mental, or developmental conditions that
				could, if untreated or poorly treated, become chronic.
									(b)Advancing and
				improving pediatric quality measures
								(1)Establishment of
				pediatric quality measures programNot later than January 1,
				2010, the Secretary shall establish a pediatric quality measures program
				to—
									(A)improve and
				strengthen the initial core child health care quality measures established by
				the Secretary under subsection (a);
									(B)expand on existing
				pediatric quality measures used by public and private health care purchasers
				and advance the development of such new and emerging quality measures;
				and
									(C)increase the
				portfolio of evidence-based, consensus pediatric quality measures available to
				public and private purchasers of children's health care services, providers,
				and consumers.
									(2)Evidence-based
				measuresThe measures developed under the pediatric quality
				measures program shall, at a minimum, be—
									(A)evidence-based
				and, where appropriate, risk adjusted;
									(B)designed to
				identify and eliminate racial and ethnic disparities in child health and the
				provision of health care;
									(C)designed to ensure
				that the data required for such measures is collected and reported in a
				standard format that permits comparison of quality and data at a State, plan,
				and provider level;
									(D)periodically
				updated; and
									(E)responsive to the
				child health needs, services, and domains of health care quality described in
				clauses (i), (ii), and (iii) of subsection (a)(6)(A).
									(3)Process for
				pediatric quality measures programIn identifying gaps in
				existing pediatric quality measures and establishing priorities for development
				and advancement of such measures, the Secretary shall consult with—
									(A)States;
									(B)pediatricians,
				children's hospitals, and other primary and specialized pediatric health care
				professionals (including members of the allied health professions) who
				specialize in the care and treatment of children, particularly children with
				special physical, mental, and developmental health care needs;
									(C)dental
				professionals, including pediatric dental professionals;
									(D)health care
				providers that furnish primary health care to children and families who live in
				urban and rural medically underserved communities or who are members of
				distinct population sub-groups at heightened risk for poor health
				outcomes;
									(E)national
				organizations representing consumers and purchasers of children’s health
				care;
									(F)national
				organizations and individuals with expertise in pediatric health quality
				measurement; and
									(G)voluntary
				consensus standards setting organizations and other organizations involved in
				the advancement of evidence-based measures of health care.
									(4)Developing,
				validating, and testing a portfolio of pediatric quality
				measuresAs part of the program to advance pediatric quality
				measures, the Secretary shall—
									(A)award grants and
				contracts for the development, testing, and validation of new, emerging, and
				innovative evidence-based measures for children’s health care services across
				the domains of quality described in clauses (i),(ii), and (iii) of subsection
				(a)(6)(A); and
									(B)award grants and
				contracts for—
										(i)the development of
				consensus on evidence-based measures for children’s health care
				services;
										(ii)the dissemination
				of such measures to public and private purchasers of health care for children;
				and
										(iii)the updating of
				such measures as necessary.
										(5)Revising,
				strengthening, and improving initial core measuresBeginning no
				later than January 1, 2012, and annually thereafter, the Secretary shall
				publish recommended changes to the core measures described in subsection (a)
				that shall reflect the testing, validation, and consensus process for the
				development of pediatric quality measures described in subsection paragraphs
				(1) through (4).
								(6)Definition of
				pediatric quality measureIn this subsection, the term
				pediatric quality measure means a measurement of clinical care
				that is capable of being examined through the collection and analysis of
				relevant information, that is developed in order to assess 1 or more aspects of
				pediatric health care quality in various institutional and ambulatory health
				care settings, including the structure of the clinical care system, the process
				of care, the outcome of care, or patient experiences in care.
								(c)Annual state
				reports regarding state-specific quality of care measures applied under
				medicaid or chip
								(1)Annual state
				reportsEach State with a State plan approved under title XIX or
				a State child health plan approved under title XXI shall annually report to the
				Secretary on the—
									(A)State-specific
				child health quality measures applied by the States under such plans, including
				measures described in subparagraphs (A) and (B) of subsection (a)(6);
				and
									(B)State-specific
				information on the quality of health care furnished to children under such
				plans, including information collected through external quality reviews of
				managed care organizations under section 1932 of the Social Security Act (42
				U.S.C. 1396u–4) and benchmark plans under sections 1937 and 2103 of such Act
				(42 U.S.C. 1396u–7, 1397cc).
									(2)PublicationNot
				later than September 30, 2009, and annually thereafter, the Secretary shall
				collect, analyze, and make publicly available the information reported by
				States under paragraph (1).
								(d)Demonstration
				projects for improving the quality of children's health care and the use of
				health information technology
								(1)In
				generalDuring the period of fiscal years 2008 through 2012, the
				Secretary shall award not more than 10 grants to States and child health
				providers to conduct demonstration projects to evaluate promising ideas for
				improving the quality of children's health care provided under title XIX or
				XXI, including projects to—
									(A)experiment with,
				and evaluate the use of, new measures of the quality of children's health care
				under such titles (including testing the validity and suitability for reporting
				of such measures);
									(B)promote the use of
				health information technology in care delivery for children under such
				titles;
									(C)evaluate
				provider-based models which improve the delivery of children's health care
				services under such titles, including care management for children with chronic
				conditions and the use of evidence-based approaches to improve the
				effectiveness, safety, and efficiency of health care services for children;
				or
									(D)demonstrate the
				impact of the model electronic health record format for children developed and
				disseminated under subsection (f) on improving pediatric health, including the
				effects of chronic childhood health conditions, and pediatric health care
				quality as well as reducing health care costs.
									(2)RequirementsIn
				awarding grants under this subsection, the Secretary shall ensure that—
									(A)only 1
				demonstration project funded under a grant awarded under this subsection shall
				be conducted in a State; and
									(B)demonstration
				projects funded under grants awarded under this subsection shall be conducted
				evenly between States with large urban areas and States with large rural
				areas.
									(3)Authority for
				multistate projectsA demonstration project conducted with a
				grant awarded under this subsection may be conducted on a multistate basis, as
				needed.
								(4)Funding$20,000,000
				of the amount appropriated under subsection (i) for a fiscal year shall be used
				to carry out this subsection.
								(e)Childhood
				obesity demonstration project
								(1)Authority To
				conduct demonstrationThe Secretary, in consultation with the
				Administrator of the Centers for Medicare & Medicaid Services, shall
				conduct a demonstration project to develop a comprehensive and systematic model
				for reducing childhood obesity by awarding grants to eligible entities to carry
				out such project. Such model shall—
									(A)identify, through
				self-assessment, behavioral risk factors for obesity among children;
									(B)identify, through
				self-assessment, needed clinical preventive and screening benefits among those
				children identified as target individuals on the basis of such risk
				factors;
									(C)provide ongoing
				support to such target individuals and their families to reduce risk factors
				and promote the appropriate use of preventive and screening benefits;
				and
									(D)be designed to
				improve health outcomes, satisfaction, quality of life, and appropriate use of
				items and services for which medical assistance is available under title XIX or
				child health assistance is available under title XXI among such target
				individuals.
									(2)Eligibility
				entitiesFor purposes of this subsection, an eligible entity is
				any of the following:
									(A)A city, county, or
				Indian tribe.
									(B)A local or tribal
				educational agency.
									(C)An accredited
				university, college, or community college.
									(D)A
				Federally-qualified health center.
									(E)A local health
				department.
									(F)A health care
				provider.
									(G)A community-based
				organization.
									(H)Any other entity
				determined appropriate by the Secretary, including a consortia or partnership
				of entities described in any of subparagraphs (A) through (G).
									(3)Use of
				fundsAn eligible entity awarded a grant under this subsection
				shall use the funds made available under the grant to—
									(A)carry out
				community-based activities related to reducing childhood obesity, including
				by—
										(i)forming
				partnerships with entities, including schools and other facilities providing
				recreational services, to establish programs for after school and weekend
				community activities that are designed to reduce childhood obesity;
										(ii)forming
				partnerships with daycare facilities to establish programs that promote healthy
				eating behaviors and physical activity; and
										(iii)developing and
				evaluating community educational activities targeting good nutrition and
				promoting healthy eating behaviors;
										(B)carry out
				age-appropriate school-based activities that are designed to reduce childhood
				obesity, including by—
										(i)developing and
				testing educational curricula and intervention programs designed to promote
				healthy eating behaviors and habits in youth, which may include—
											(I)after hours
				physical activity programs; and
											(II)science-based
				interventions with multiple components to prevent eating disorders including
				nutritional content, understanding and responding to hunger and satiety,
				positive body image development, positive self-esteem development, and learning
				life skills (such as stress management, communication skills, problemsolving
				and decisionmaking skills), as well as consideration of cultural and
				developmental issues, and the role of family, school, and community;
											(ii)providing
				education and training to educational professionals regarding how to promote a
				healthy lifestyle and a healthy school environment for children;
										(iii)planning and
				implementing a healthy lifestyle curriculum or program with an emphasis on
				healthy eating behaviors and physical activity; and
										(iv)planning and
				implementing healthy lifestyle classes or programs for parents or guardians,
				with an emphasis on healthy eating behaviors and physical activity for
				children;
										(C)carry out
				educational, counseling, promotional, and training activities through the local
				health care delivery systems including by—
										(i)promoting healthy
				eating behaviors and physical activity services to treat or prevent eating
				disorders, being overweight, and obesity;
										(ii)providing patient
				education and counseling to increase physical activity and promote healthy
				eating behaviors;
										(iii)training health
				professionals on how to identify and treat obese and overweight individuals
				which may include nutrition and physical activity counseling; and
										(iv)providing
				community education by a health professional on good nutrition and physical
				activity to develop a better understanding of the relationship between diet,
				physical activity, and eating disorders, obesity, or being overweight;
				and
										(D)provide, through
				qualified health professionals, training and supervision for community health
				workers to—
										(i)educate families
				regarding the relationship between nutrition, eating habits, physical activity,
				and obesity;
										(ii)educate families
				about effective strategies to improve nutrition, establish healthy eating
				patterns, and establish appropriate levels of physical activity; and
										(iii)educate and
				guide parents regarding the ability to model and communicate positive health
				behaviors.
										(4)PriorityIn
				awarding grants under paragraph (1), the Secretary shall give priority to
				awarding grants to eligible entities—
									(A)that demonstrate
				that they have previously applied successfully for funds to carry out
				activities that seek to promote individual and community health and to prevent
				the incidence of chronic disease and that can cite published and peer-reviewed
				research demonstrating that the activities that the entities propose to carry
				out with funds made available under the grant are effective;
									(B)that will carry
				out programs or activities that seek to accomplish a goal or goals set by the
				State in the Healthy People 2010 plan of the State;
									(C)that provide
				non-Federal contributions, either in cash or in-kind, to the costs of funding
				activities under the grants;
									(D)that develop
				comprehensive plans that include a strategy for extending program activities
				developed under grants in the years following the fiscal years for which they
				receive grants under this subsection;
									(E)located in
				communities that are medically underserved, as determined by the
				Secretary;
									(F)located in areas
				in which the average poverty rate is at least 150 percent or higher of the
				average poverty rate in the State involved, as determined by the Secretary;
				and
									(G)that submit plans
				that exhibit multisectoral, cooperative conduct that includes the involvement
				of a broad range of stakeholders, including—
										(i)community-based
				organizations;
										(ii)local
				governments;
										(iii)local
				educational agencies;
										(iv)the private
				sector;
										(v)State or local
				departments of health;
										(vi)accredited
				colleges, universities, and community colleges;
										(vii)health care
				providers;
										(viii)State and local
				departments of transportation and city planning; and
										(ix)other entities
				determined appropriate by the Secretary.
										(5)Program
				design
									(A)Initial
				designNot later than 1 year after the date of enactment of the
				Children's Health Insurance Program
				Reauthorization Act of 2007, the Secretary shall design the
				demonstration project. The demonstration should draw upon promising, innovative
				models and incentives to reduce behavioral risk factors. The Administrator of
				the Centers for Medicare & Medicaid Services shall consult with the
				Director of the Centers for Disease Control and Prevention, the Director of the
				Office of Minority Health, the heads of other agencies in the Department of
				Health and Human Services, and such professional organizations, as the
				Secretary determines to be appropriate, on the design, conduct, and evaluation
				of the demonstration.
									(B)Number and
				project areasNot later than 2 years after the date of enactment
				of the Children's Health Insurance Program
				Reauthorization Act of 2007, the Secretary shall award 1 grant
				that is specifically designed to determine whether programs similar to programs
				to be conducted by other grantees under this subsection should be implemented
				with respect to the general population of children who are eligible for child
				health assistance under State child health plans under title XXI in order to
				reduce the incidence of childhood obesity among such population.
									(6)Report to
				congressNot later than 3 years after the date the Secretary
				implements the demonstration project under this subsection, the Secretary shall
				submit to Congress a report that describes the project, evaluates the
				effectiveness and cost effectiveness of the project, evaluates the beneficiary
				satisfaction under the project, and includes any such other information as the
				Secretary determines to be appropriate.
								(7)DefinitionsIn
				this subsection:
									(A)Federally-qualified
				health centerThe term Federally-qualified health
				center has the meaning given that term in section 1905(l)(2)(B).
									(B)Indian
				tribeThe term Indian tribe has the meaning given
				that term in section 4 of the Indian Health Care Improvement Act (25 U.S.C.
				1603).
									(C)Self-assessmentThe
				term self-assessment means a form that—
										(i)includes questions
				regarding—
											(I)behavioral risk
				factors;
											(II)needed preventive
				and screening services; and
											(III)target
				individuals' preferences for receiving follow-up information;
											(ii)is
				assessed using such computer generated assessment programs; and
										(iii)allows for the
				provision of such ongoing support to the individual as the Secretary determines
				appropriate.
										(D)Ongoing
				supportThe term ongoing support means—
										(i)to
				provide any target individual with information, feedback, health coaching, and
				recommendations regarding—
											(I)the results of a
				self-assessment given to the individual;
											(II)behavior
				modification based on the self-assessment; and
											(III)any need for
				clinical preventive and screening services or treatment including medical
				nutrition therapy;
											(ii)to provide any
				target individual with referrals to community resources and programs available
				to assist the target individual in reducing health risks; and
										(iii)to provide the
				information described in clause (i) to a health care provider, if designated by
				the target individual to receive such information.
										(8)Authorization of
				appropriationsThere is authorized to be appropriated to carry
				out this subsection, $25,000,000 for the period of fiscal years 2008 through
				2012.
								(f)Development of
				model electronic health record format for children enrolled in Medicaid or
				CHIP
								(1)In
				generalNot later than
				January 1, 2009, the Secretary shall establish a program to encourage the
				development and dissemination of a model electronic health record format for
				children enrolled in the State plan under title XIX or the State child health
				plan under title XXI that is—
									(A)subject to State laws, accessible to
				parents, caregivers, and other consumers for the sole purpose of demonstrating
				compliance with school or leisure activity requirements, such as appropriate
				immunizations or physicals;
									(B)designed to allow interoperable exchanges
				that conform with Federal and State privacy and security requirements;
									(C)structured in a
				manner that permits parents and caregivers to view and understand the extent to
				which the care their children receive is clinically appropriate and of high
				quality; and
									(D)capable of being
				incorporated into, and otherwise compatible with, other standards developed for
				electronic health records.
									(2)Funding$5,000,000
				of the amount appropriated under subsection (i) for a fiscal year shall be used
				to carry out this subsection.
								(g)Study of
				pediatric health and health care quality measures
								(1)In
				generalNot later than July 1, 2009, the Institute of Medicine
				shall study and report to Congress on the extent and quality of efforts to
				measure child health status and the quality of health care for children across
				the age span and in relation to preventive care, treatments for acute
				conditions, and treatments aimed at ameliorating or correcting physical,
				mental, and developmental conditions in children. In conducting such study and
				preparing such report, the Institute of Medicine shall—
									(A)consider all of
				the major national population-based reporting systems sponsored by the Federal
				Government that are currently in place, including reporting requirements under
				Federal grant programs and national population surveys and estimates conducted
				directly by the Federal Government;
									(B)identify the
				information regarding child health and health care quality that each system is
				designed to capture and generate, the study and reporting periods covered by
				each system, and the extent to which the information so generated is made
				widely available through publication;
									(C)identify gaps in
				knowledge related to children’s health status, health disparities among
				subgroups of children, the effects of social conditions on children’s health
				status and use and effectiveness of health care, and the relationship between
				child health status and family income, family stability and preservation, and
				children’s school readiness and educational achievement and attainment;
				and
									(D)make
				recommendations regarding improving and strengthening the timeliness, quality,
				and public transparency and accessibility of information about child health and
				health care quality.
									(2)FundingUp
				to $1,000,000 of the amount appropriated under subsection (i) for a fiscal year
				shall be used to carry out this subsection.
								(h)Rule of
				constructionNotwithstanding any other provision in this section,
				no evidence based quality measure developed, published, or used as a basis of
				measurement or reporting under this section may be used to establish an
				irrebuttable presumption regarding either the medical necessity of care or the
				maximum permissible coverage for any individual child who is eligible for and
				receiving medical assistance under title XIX or child health assistance under
				title XXI .
							(i)AppropriationOut
				of any funds in the Treasury not otherwise appropriated, there is appropriated
				for each of fiscal years 2008 through 2012, $45,000,000 for the purpose of
				carrying out this section (other than subsection (e)). Funds appropriated under
				this subsection shall remain available until
				expended.
							.
				(b)Increased
			 matching rate for collecting and reporting on child health
			 measuresSection
			 1903(a)(3)(A) (42 U.S.C. 1396b(a)(3)(A)), is amended—
					(1)by striking
			 and at the end of clause (i); and
					(2)by adding at the
			 end the following new clause:

							(iii)an amount equal to the Federal
				medical assistance percentage (as defined in section 1905(b)) of so much of the
				sums expended during such quarter (as found necessary by the Secretary for the
				proper and efficient administration of the State plan) as are attributable to
				such developments or modifications of systems of the type described in clause
				(i) as are necessary for the efficient collection and reporting on child health
				measures;
				and
							.
					502.Improved
			 information regarding access to coverage under CHIP
				(a)Inclusion of
			 process and access measures in annual state reportsSection 2108 (42 U.S.C. 1397hh) is
			 amended—
					(1)in subsection (a),
			 in the matter preceding paragraph (1), by striking The State and
			 inserting Subject to subsection (e), the State; and
					(2)by adding at the
			 end the following new subsection:

							(e)Information
				required for inclusion in state annual reportThe State shall
				include the following information in the annual report required under
				subsection (a):
								(1)Eligibility
				criteria, enrollment, and retention data (including data with respect to
				continuity of coverage or duration of benefits).
								(2)Data regarding the
				extent to which the State uses process measures with respect to determining the
				eligibility of children under the State child health plan, including measures
				such as 12-month continuous eligibility, self-declaration of income for
				applications or renewals, or presumptive eligibility.
								(3)Data regarding
				denials of eligibility and redeterminations of eligibility.
								(4)Data regarding
				access to primary and specialty services, access to networks of care, and care
				coordination provided under the State child health plan, using quality care and
				consumer satisfaction measures included in the Consumer Assessment of
				Healthcare Providers and Systems (CAHPS) survey.
								(5)If the State
				provides child health assistance in the form of premium assistance for the
				purchase of coverage under a group health plan, data regarding the provision of
				such assistance, including the extent to which employer-sponsored health
				insurance coverage is available for children eligible for child health
				assistance under the State child health plan, the range of the monthly amount
				of such assistance provided on behalf of a child or family, the number of
				children or families provided such assistance on a monthly basis, the income of
				the children or families provided such assistance, the benefits and
				cost-sharing protection provided under the State child health plan to
				supplement the coverage purchased with such premium assistance, the effective
				strategies the State engages in to reduce any administrative barriers to the
				provision of such assistance, and, the effects, if any, of the provision of
				such assistance on preventing the coverage provided under the State child
				health plan from substituting for coverage provided under employer-sponsored
				health insurance offered in the State.
								(6)To the extent applicable, a description of
				any State activities that are designed to reduce the number of uncovered
				children in the State, including through a State health insurance connector
				program or support for innovative private health coverage
				initiatives.
								.
					(b)GAO study and
			 report on access to primary and speciality services
					(1)In
			 generalThe Comptroller General of the United States shall
			 conduct a study of children’s access to primary and specialty services under
			 Medicaid and CHIP, including—
						(A)the extent to
			 which providers are willing to treat children eligible for such
			 programs;
						(B)information on such
			 children's access to networks of care;
						(C)geographic
			 availability of primary and specialty services under such programs;
						(D)the extent to
			 which care coordination is provided for children’s care under Medicaid and
			 CHIP; and
						(E)as appropriate,
			 information on the degree of availability of services for children under such
			 programs.
						(2)ReportNot
			 later than 2 years after the date of enactment of this Act, the Comptroller
			 General shall submit a report to the appropriate committees of Congress on the
			 study conducted under paragraph (1) that includes recommendations for such
			 Federal and State legislative and administrative changes as the Comptroller
			 General determines are necessary to address any barriers to access to
			 children's care under Medicaid and CHIP that may exist.
					503.Application of
			 certain managed care quality safeguards to CHIPSection 2107(e)(1) (42 U.S.C. 1397gg(e)(1)),
			 as amended by section 204(b), is amended by redesignating subparagraph (E) (as
			 added by such section) as subparagraph (F) and by inserting after subparagraph
			 (D) the following new subparagraph:

					(E)Subsections
				(a)(4), (a)(5), (b), (c), (d), and (e) of section 1932 (relating to
				requirements for managed
				care).
					.
			VIMiscellaneous
			601.Technical
			 correction regarding current State authority under Medicaid
				(a)In
			 generalOnly with respect to expenditures for medical assistance
			 under a State Medicaid plan, including any waiver of such plan, for fiscal
			 years 2007 and 2008, a State may elect, notwithstanding the fourth sentence of
			 subsection (b) of section 1905 of the Social Security Act (42 U.S.C. 1396d) or
			 subsection (u) of such section—
					(1)to
			 cover individuals described in section 1902(a)(10)(A)(ii)(IX) of the Social
			 Security Act and, at its option, to apply less restrictive methodologies to
			 such individuals under section 1902(r)(2) of such Act or 1931(b)(2)(C) of such
			 Act and thereby receive Federal financial participation for medical assistance
			 for such individuals under title XIX of the Social Security Act; or
					(2)to receive Federal
			 financial participation for expenditures for medical assistance under title XIX
			 of such Act for children described in paragraph (2)(B) or (3) of section
			 1905(u) of such Act based on the Federal medical assistance percentage, as
			 otherwise determined based on the first and third sentences of subsection (b)
			 of section 1905 of the Social Security Act, rather than on the basis of an
			 enhanced FMAP (as defined in section 2105(b) of such Act).
					(b)RepealEffective
			 October 1, 2008, subsection (a) is repealed.
				(c)Hold
			 harmlessNo State that elects the option described in subsection
			 (a) shall be treated as not having been authorized to make such election and to
			 receive Federal financial participation for expenditures for medical assistance
			 described in that subsection for fiscal years 2007 and 2008 as a result of the
			 repeal of the subsection under subsection (b).
				602.Payment error
			 rate measurement (PERM)
				(a)Expenditures
			 related to compliance with requirements
					(1)Enhanced
			 paymentsSection 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 paymentsNotwithstanding subsection (b), the
				enhanced FMAP with respect to payments under subsection (a) for expenditures
				related to the administration of the payment error rate measurement (PERM)
				requirements applicable to the State child health plan in accordance with the
				Improper 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 administrative expendituresSection 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 measurement (PERM) expendituresExpenditures related to the
				administration of the payment error rate measurement (PERM) requirements
				applicable to the State child health plan in accordance with the Improper
				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).
							.
					(b)Final rule
			 required To be in effect for all statesNotwithstanding parts 431
			 and 457 of title 42, Code of Federal Regulations (as in effect on the date of
			 enactment of this Act), the Secretary shall not calculate or publish any
			 national or State-specific error rate based on the application of the payment
			 error rate measurement (in this section referred to as PERM)
			 requirements to CHIP until after the date that is 6 months after the date on
			 which a final rule implementing such requirements in accordance with the
			 requirements of subsection (c) is in effect for all States. Any calculation of
			 a national error rate or a State specific error rate after such final rule in
			 effect for all States may only be inclusive of errors, as defined in such final
			 rule or in guidance issued within a reasonable time frame after the effective
			 date for such final rule that includes detailed guidance for the specific
			 methodology for error determinations.
				(c)Requirements for
			 final ruleFor purposes of subsection (b), the requirements of
			 this subsection are that the final rule implementing the PERM requirements
			 shall include—
					(1)clearly defined
			 criteria for errors for both States and providers;
					(2)a
			 clearly defined process for appealing error determinations by review
			 contractors; and
					(3)clearly defined
			 responsibilities and deadlines for States in implementing any corrective action
			 plans.
					(d)Option for
			 application of data for certain states under the interim final rule
					(1)Option for
			 states in first application cycleAfter the final rule
			 implementing the PERM requirements in accordance with the requirements of
			 subsection (c) is in effect for all States, a State for which the PERM
			 requirements were first in effect under an interim final rule for fiscal year
			 2007 may elect to accept any payment error rate determined in whole or in part
			 for the State on the basis of data for that fiscal year or may elect to not
			 have any payment error rate determined on the basis of such data and, instead,
			 shall be treated as if fiscal year 2010 were the first fiscal year for which
			 the PERM requirements apply to the State.
					(2)Option for states
			 in second application cycleIf such final rule is not in effect
			 for all States by July 1, 2008, a State for which the PERM requirements were
			 first in effect under an interim final rule for fiscal year 2008 may elect to
			 accept any payment error rate determined in whole or in part for the State on
			 the basis of data for that fiscal year or may elect to not have any payment
			 error rate determined on the basis of such data and, instead, shall be treated
			 as if fiscal year 2011 were the first fiscal year for which the PERM
			 requirements apply to the State.
					(e)Harmonization of
			 MEQC and PERM
					(1)Reduction of
			 redundanciesThe Secretary shall review the Medicaid Eligibility
			 Quality Control (in this subsection referred to as the MEQC)
			 requirements with the PERM requirements and coordinate consistent
			 implementation of both sets of requirements, while reducing
			 redundancies.
					(2)State option to
			 apply perm dataA State may elect, for purposes of determining
			 the erroneous excess payments for medical assistance ratio applicable to the
			 State for a fiscal year under section 1903(u) of the Social Security Act (42
			 U.S.C. 1396b(u)) to substitute data resulting from the application of the PERM
			 requirements to the State after the final rule implementing such requirements
			 is in effect for all States for data obtained from the application of the MEQC
			 requirements to the State with respect to a fiscal year.
					(f)Identification
			 of improved state-specific sample sizesThe Secretary shall
			 establish State-specific sample sizes for application of the PERM requirements
			 with respect to State child health plans for fiscal years beginning with fiscal
			 year 2009, on the basis of such information as the Secretary determines
			 appropriate. In establishing such sample sizes, the Secretary shall, to the
			 greatest extent practicable—
					(1)minimize the
			 administrative cost burden on States under Medicaid and CHIP; and
					(2)maintain State
			 flexibility to manage such programs.
					603.Elimination of
			 counting medicaid child presumptive eligibility costs against title XXI
			 allotmentSection 2105(a)(1)
			 (42 U.S.C. 1397ee(a)(1)) is amended—
				(1)in the matter
			 preceding subparagraph (A), by striking (or, in the case of expenditures
			 described in subparagraph (B), the Federal medical assistance percentage (as
			 defined in the first sentence of section 1905(b))); and
				(2)by striking
			 subparagraph (B) and inserting the following new subparagraph:

						(B)[reserved]
						.
				604.Improving data
			 collection
				(a)Increased
			 appropriationSection
			 2109(b)(2) (42 U.S.C. 1397ii(b)(2)) is amended by striking $10,000,000
			 for fiscal year 2000 and inserting $20,000,000 for fiscal year
			 2008.
				(b)Use of
			 additional fundsSection 2109(b) (42 U.S.C. 1397ii(b)), as
			 amended by subsection (a), is amended—
					(1)by redesignating
			 paragraph (2) as paragraph (4); and
					(2)by inserting after
			 paragraph (1), the following new paragraphs:

							(2)Additional
				requirementsIn addition to making the adjustments required to
				produce the data described in paragraph (1), with respect to data collection
				occurring for fiscal years beginning with fiscal year 2008, in appropriate
				consultation with the Secretary of Health and Human Services, the Secretary of
				Commerce shall do the following:
								(A)Make appropriate
				adjustments to the Current Population Survey to develop more accurate
				State-specific estimates of the number of children enrolled in health coverage
				under title XIX or this title.
								(B)Make appropriate
				adjustments to the Current Population Survey to improve the survey estimates
				used to compile the State-specific and national number of low-income children
				without health insurance for purposes of determining allotments under
				subsections (c) and (i) of section 2104 and making payments to States from the
				CHIP Incentive Bonuses Pool established under subsection (j) of such section,
				the CHIP Contingency Fund established under subsection (k) of such section,
				and, to the extent applicable to a State, from the block grant set aside under
				section 2112(b)(2)(A)(i) for each of fiscal years 2010 through 2012.
								(C)Include health
				insurance survey information in the American Community Survey related to
				children.
								(D)Assess whether
				American Community Survey estimates, once such survey data are first available,
				produce more reliable estimates than the Current Population Survey with respect
				to the purposes described in subparagraph (B).
								(E)On the basis of
				the assessment required under subparagraph (D), recommend to the Secretary of
				Health and Human Services whether American Community Survey estimates should be
				used in lieu of, or in some combination with, Current Population Survey
				estimates for the purposes described in subparagraph (B).
								(F)Continue making
				the adjustments described in the last sentence of paragraph (1) with respect to
				expansion of the sample size used in State sampling units, the number of
				sampling units in a State, and using an appropriate verification
				element.
								(3)Authority for
				the Secretary of Health and Human Services to transition to the use of all, or
				some combination of, ACS estimates upon recommendation of the secretary of
				commerceIf, on the basis of the assessment required under
				paragraph (2)(D), the Secretary of Commerce recommends to the Secretary of
				Health and Human Services that American Community Survey estimates should be
				used in lieu of, or in some combination with, Current Population Survey
				estimates for the purposes described in paragraph (2)(B), the Secretary of
				Health and Human Services may provide for a period during which the Secretary
				may transition from carrying out such purposes through the use of Current
				Population Survey estimates to the use of American Community Survey estimates
				(in lieu of, or in combination with the Current Population Survey estimates, as
				recommended), provided that any such transition is implemented in a manner that
				is designed to avoid adverse impacts upon States with approved State child
				health plans under this
				title.
							.
					605.Deficit
			 Reduction Act technical corrections
				(a)Determination of
			 Medicaid patient days for DSH computation
					(1)In
			 generalSection 5002 of the Deficit Reduction Act of 2005 (Public
			 Law 109–171, 120 Stat. 31) is amended by adding at the end the following new
			 subsection:

							(c)Determination of
				medicaid patient days for discharges occurring On or after the date of
				enactment of this subsectionFor discharges occurring on or after
				the date of enactment of this subsection, in determining under section
				1886(d)(5)(F)(vi)(II) of the Social Security
				Act (42 U.S.C. 1395ww(d)(5)(F)(vi)(II)) the number of the hospital’s
				patient days for the applicable cost reporting period which consist of patients
				who (for such days) were eligible for medical assistance under a State plan
				approved under title XIX, the Secretary shall include patient days of patients
				who are eligible to receive inpatient hospital benefits under a demonstration
				project approved under title XI and shall not include patient days under such a
				project if the patient is not eligible to receive inpatient hospital benefits
				under the
				project.
							.
					(2)Conforming
			 amendmentThe last sentence of section 1886(d)(5)(F)(vi) of the
			 Social Security Act (42 U.S.C.
			 1395ww(d)(5)(F)(vi)), as added by section 5002(a) of the Deficit Reduction Act
			 of 2005 (Public Law 109–171), is amended by striking In determining
			 under subclause (II) and inserting Subject to section 5002(c) of
			 the Deficit Reduction Act of 2005, in determining under subclause
			 (II).
					(3)Effective
			 dateThe amendments made by this subsection shall take effect on
			 the date of enactment of this Act.
					(b)State
			 Flexibility in Benefit Packages
					(1)Clarification of
			 requirement to provide epsdt services for all children in benchmark benefit
			 packagesSection 1937(a)(1) (42 U.S.C. 1396u–7(a)(1)), as
			 inserted by section 6044(a) of the Deficit Reduction Act of 2005 (Public Law
			 109–171, 120 Stat. 88), is amended—
						(A)in subparagraph
			 (A)—
							(i)in
			 the matter before clause (i), by striking enrollment in coverage that
			 provides and inserting coverage that;
							(ii)in
			 clause (i), by inserting provides after (i);
			 and
							(iii)by
			 striking clause (ii) and inserting the following:

									(ii)for any
				individual described in section 1905(a)(4)(B) who is eligible under the State
				plan in accordance with paragraphs (10) and (17) of section 1902(a), consists
				of the items and services described in section 1905(a)(4)(B) (relating to early
				and periodic screening, diagnostic, and treatment services defined in section
				1905(r)) and provided in accordance with the requirements of section
				1902(a)(43).
									;
							(B)in subparagraph
			 (C)—
							(i)in
			 the heading, by striking wrap-around and inserting
			 additional; and
							(ii)by
			 striking wrap-around or; and
							(C)by adding at the
			 end the following new subparagraph:

								(E)Rule of
				constructionNothing in this paragraph shall be construed
				as—
									(i)requiring a State
				to offer all or any of the items and services required by subparagraph (A)(ii)
				through an issuer of benchmark coverage described in subsection (b)(1) or
				benchmark equivalent coverage described in subsection (b)(2); or
									(ii)preventing a State
				from offering all or any of the items and services required by subparagraph
				(A)(ii) through an issuer of benchmark coverage described in subsection (b)(1)
				or benchmark equivalent coverage described in subsection
				(b)(2).
									.
						(2)Correction of
			 reference to children in foster care receiving child welfare
			 servicesSection 1937(a)(2)(B)(viii) (42 U.S.C.
			 1396u–7(a)(2)(B)(viii), as inserted by section 6044(a) of the Deficit Reduction
			 Act of 2005, is amended by striking aid or assistance is made available
			 under part B of title IV to children in foster care and individuals and
			 inserting child welfare services are made available under part B of
			 title IV on the basis of being a child in foster care or.
					(3)TransparencySection
			 1937 (42 U.S.C. 1396u–7), as inserted by section 6044(a) of the Deficit
			 Reduction Act of 2005, is amended by adding at the end the following:

							(c)Publication of
				provisions affectedNot later than 30 days after the date the
				Secretary approves a State plan amendment to provide benchmark benefits in
				accordance with subsections (a) and (b), the Secretary shall publish in the
				Federal Register and on the Internet website of the Centers for Medicare &
				Medicaid Services, a list of the provisions of this title that the Secretary
				has determined do not apply in order to enable the State to carry out such plan
				amendment and the reason for each such
				determination.
							.
					(4)Effective
			 dateThe amendments made by this subsection shall take effect as
			 if included in the amendment made by section 6044(a) of the Deficit Reduction
			 Act of 2005.
					606.Elimination of confusing program
			 referencesSection 704 of the
			 Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999, as
			 enacted into law by division B of Public Law 106–113 (113 Stat. 1501A–402) is
			 repealed.
			607.Mental health parity
			 in CHIP plans
				(a)Assurance of
			 paritySection 2103(c) (42 U.S.C. 1397cc(c)) is amended—
					(1)by
			 redesignating paragraph (5) as paragraph (6); and
					(2)by inserting after
			 paragraph (4), the following:

							(5)Mental health
				services parity
								(A)In
				generalIn the case of a State child health plan that provides
				both medical and surgical benefits and mental health or substance abuse
				benefits, such plan shall ensure that the financial requirements and treatment
				limitations applicable to such mental health or substance abuse benefits are no
				more restrictive than the financial requirements and treatment limitations
				applied to substantially all medical and surgical benefits covered by the
				plan.
								(B)Deemed
				complianceTo the extent that a State child health plan includes
				coverage with respect to an individual described in section 1905(a)(4)(B) and
				covered under the State plan under section 1902(a)(10)(A) of the services
				described in section 1905(a)(4)(B) (relating to early and periodic screening,
				diagnostic, and treatment services defined in section 1905(r)) and provided in
				accordance with section 1902(a)(43), such plan shall be deemed to satisfy the
				requirements of subparagraph
				(A).
								.
					(b)Conforming amendmentsSection 2103 (42 U.S.C. 1397cc) is
			 amended—
					(1)in subsection (a), in the matter preceding
			 paragraph (1), by striking subsection (c)(5) and inserting
			 paragraphs (5) and (6) of subsection (c); and
					(2)in subsection
			 (c)(2), by striking subparagraph (B) and redesignating subparagraphs (C) and
			 (D) as subparagraphs (B) and (C), respectively.
					608.Dental health
			 grantsTitle XXI (42 U.S.C.
			 1397aa et seq.), as amended by section 201, is amended by adding at the end the
			 following:

					2114.Dental health
				grants
						(a)Authority To
				award grants
							(1)In
				generalFrom the amount appropriated under subsection (e), the
				Secretary shall award grants from amounts to eligible States for the purpose of
				carrying out programs and activities that are designed to improve the
				availability of dental services and strengthen dental coverage for targeted
				low-income children enrolled in State child health plans.
							(2)Eligible
				stateIn this section, the term eligible State means
				a State with an approved State child health plan under this title that submits
				an application under subsection (b) that is approved by Secretary.
							(b)ApplicationAn
				eligible State that desires to receive a grant under this paragraph shall
				submit an application to the Secretary in such form and manner, and containing
				such information, as the Secretary may require. Such application shall
				include—
							(1)a detailed
				description of the programs and activities proposed to be conducted with funds
				awarded under the grant;
							(2)quality and
				outcomes performance measures to evaluate the effectiveness of such activities;
				and
							(3)an assurance that
				the State shall—
								(A)conduct an
				assessment of the effectiveness of such activities against such performance
				measures; and
								(B)cooperate with the
				collection and reporting of data and other information determined as a result
				of conducting such assessments to the Secretary, in such form and manner as the
				Secretary shall require.
								(c)Maintenance of
				effort for states awarded grants; no state match requiredIn the
				case of a State that is awarded a grant under this section—
							(1)the State share of
				funds expended for dental services under the State child health plan shall not
				be less than the State share of such funds expended in the fiscal year
				preceding the first fiscal year for which the grant is awarded; and
							(2)no State matching
				funds shall be required for the State to receive a grant under this
				section.
							(d)Annual
				reportThe Secretary shall submit an annual report to the
				appropriate committees of Congress regarding the grants awarded under this
				section that includes—
							(1)State specific
				descriptions of the programs and activities conducted with funds awarded under
				such grants; and
							(2)information
				regarding the assessments required of States under subsection (b)(3).
							(e)AppropriationOut of any funds in the Treasury not
				otherwise appropriated, there is appropriated, $200,000,000 for the period of
				fiscal years 2008 through 2012, to remain available until expended, for the
				purpose of awarding grants to States 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.
						.
			609.Application of
			 prospective payment system for services provided by Federally-qualified health
			 centers and rural health clinics
				(a)Application of
			 prospective payment system
					(1)In
			 generalSection 2107(e)(1)
			 (42 U.S.C. 1397gg(e)(1)), as amended by sections 204(b) and 503, is amended by
			 inserting after subparagraph (A) the following new subparagraph (and
			 redesignating the succeeding subparagraphs accordingly):

							(B)Section 1902(bb)
				(relating to payment for services provided by Federally-qualified health
				centers and rural health
				clinics).
							.
					(2)Effective
			 dateThe amendment made by paragraph (1) shall apply to services
			 provided on or after October 1, 2008.
					(b)Transition grants
					(1)AppropriationOut of any funds in the Treasury not
			 otherwise appropriated, there is appropriated to the Secretary for fiscal year
			 2008, $5,000,000, to remain available until expended, for the purpose of
			 awarding grants to States with State child health plans under CHIP that are
			 operated separately from the State Medicaid plan under title XIX of the Social
			 Security Act (including any waiver of such plan), or in combination with the
			 State Medicaid plan, for expenditures related to transitioning to compliance
			 with the requirement of section 2107(e)(1)(B) of the Social Security Act (as
			 added by subsection (a)) to apply the prospective payment system established
			 under section 1902(bb) of the such Act (42 U.S.C. 1396a(bb)) to services
			 provided by Federally-qualified health centers and rural health clinics.
					(2)Monitoring and
			 reportThe Secretary shall
			 monitor the impact of the application of such prospective payment system on the
			 States described in paragraph (1) and, not later than October 1, 2010, shall
			 report to Congress on any effect on access to benefits, provider payment rates,
			 or scope of benefits offered by such States as a result of the application of
			 such payment system.
					VIIRevenue
			 Provisions
			701.Increase in
			 excise tax rate on tobacco products
				(a)CigarsSection
			 5701(a) of the Internal Revenue Code of 1986 is amended—
					(1)by striking
			 $1.828 cents per thousand ($1.594 cents per thousand on cigars removed
			 during 2000 or 2001) in paragraph (1) and inserting $50.00 per
			 thousand,
					(2)by striking
			 20.719 percent (18.063 percent on cigars removed during 2000 or
			 2001) in paragraph (2) and inserting 53.13 percent,
			 and
					(3)by striking
			 $48.75 per thousand ($42.50 per thousand on cigars removed during 2000
			 or 2001) in paragraph (2) and inserting $10.00 per
			 cigar.
					(b)CigarettesSection
			 5701(b) of such Code is amended—
					(1)by striking
			 $19.50 per thousand ($17 per thousand on cigarettes removed during 2000
			 or 2001) in paragraph (1) and inserting $50.00 per
			 thousand, and
					(2)by striking
			 $40.95 per thousand ($35.70 per thousand on cigarettes removed during
			 2000 or 2001) in paragraph (2) and inserting $104.9999 cents per
			 thousand.
					(c)Cigarette
			 PapersSection 5701(c) of such Code is amended by striking
			 1.22 cents (1.06 cents on cigarette papers removed during 2000 or
			 2001) and inserting 3.13 cents.
				(d)Cigarette
			 TubesSection 5701(d) of such Code is amended by striking
			 2.44 cents (2.13 cents on cigarette tubes removed during 2000 or
			 2001) and inserting 6.26 cents.
				(e)Smokeless
			 TobaccoSection 5701(e) of such Code is amended—
					(1)by striking
			 58.5 cents (51 cents on snuff removed during 2000 or 2001) in
			 paragraph (1) and inserting $1.50, and
					(2)by striking
			 19.5 cents (17 cents on chewing tobacco removed during 2000 or
			 2001) in paragraph (2) and inserting 50 cents.
					(f)Pipe
			 TobaccoSection 5701(f) of such Code is amended by striking
			 $1.0969 cents (95.67 cents on pipe tobacco removed during 2000 or
			 2001) and inserting $2.8126 cents.
				(g)Roll-Your-Own
			 TobaccoSection 5701(g) of such Code is amended by striking
			 $1.0969 cents (95.67 cents on roll-your-own tobacco removed during 2000
			 or 2001) and inserting $8.8889 cents.
				(h)Floor Stocks
			 Taxes
					(1)Imposition of
			 taxOn tobacco products and cigarette papers and tubes
			 manufactured in or imported into the United States which are removed before
			 January 1, 2008, and held on such date for sale by any person, there is hereby
			 imposed a tax in an amount equal to the excess of—
						(A)the tax which
			 would be imposed under section 5701 of the Internal Revenue Code of 1986 on the
			 article if the article had been removed on such date, over
						(B)the prior tax (if
			 any) imposed under section 5701 of such Code on such article.
						(2)Credit against
			 taxEach person shall be allowed as a credit against the taxes
			 imposed by paragraph (1) an amount equal to $500. Such credit shall not exceed
			 the amount of taxes imposed by paragraph (1) on January 1, 2008, for which such
			 person is liable.
					(3)Liability for
			 tax and method of payment
						(A)Liability for
			 taxA person holding tobacco products, cigarette papers, or
			 cigarette tubes on January 1, 2008, to which any tax imposed by paragraph (1)
			 applies shall be liable for such tax.
						(B)Method of
			 paymentThe tax imposed by paragraph (1) shall be paid in such
			 manner as the Secretary shall prescribe by regulations.
						(C)Time for
			 paymentThe tax imposed by paragraph (1) shall be paid on or
			 before April 1, 2008.
						(4)Articles in
			 foreign trade zonesNotwithstanding the Act of June 18, 1934
			 (commonly known as the Foreign Trade Zone Act, 48 Stat. 998, 19 U.S.C. 81a et
			 seq.) or any other provision of law, any article which is located in a foreign
			 trade zone on January 1, 2008, shall be subject to the tax imposed by paragraph
			 (1) if—
						(A)internal revenue
			 taxes have been determined, or customs duties liquidated, with respect to such
			 article before such date pursuant to a request made under the 1st proviso of
			 section 3(a) of such Act, or
						(B)such article is
			 held on such date under the supervision of an officer of the United States
			 Customs and Border Protection of the Department of Homeland Security pursuant
			 to the 2d proviso of such section 3(a).
						(5)DefinitionsFor
			 purposes of this subsection—
						(A)In
			 generalAny term used in this subsection which is also used in
			 section 5702 of the Internal Revenue Code of 1986 shall have the same meaning
			 as such term has in such section.
						(B)SecretaryThe
			 term Secretary means the Secretary of the Treasury or the
			 Secretary’s delegate.
						(6)Controlled
			 groupsRules similar to the rules of section 5061(e)(3) of such
			 Code shall apply for purposes of this subsection.
					(7)Other laws
			 applicableAll provisions of law, including penalties, applicable
			 with respect to the taxes imposed by section 5701 of such Code shall, insofar
			 as applicable and not inconsistent with the provisions of this subsection,
			 apply to the floor stocks taxes imposed by paragraph (1), to the same extent as
			 if such taxes were imposed by such section 5701. The Secretary may treat any
			 person who bore the ultimate burden of the tax imposed by paragraph (1) as the
			 person to whom a credit or refund under such provisions may be allowed or
			 made.
					(i)Effective
			 DateThe amendments made by this section shall apply to articles
			 removed (as defined in section 5702(j) of the Internal Revenue Code of 1986)
			 after December 31, 2007.
				702.Administrative
			 improvements
				(a)Permit, report,
			 and record requirements for manufacturers and importers of processed
			 tobacco
					(1)Permits
						(A)ApplicationSection
			 5712 of the Internal Revenue Code of 1986 is amended by inserting or
			 processed tobacco after tobacco products.
						(B)IssuanceSection
			 5713(a) of such Code is amended by inserting or processed
			 tobacco after tobacco products.
						(2)Inventories and
			 reports
						(A)InventoriesSection
			 5721 of such Code is amended by inserting , processed tobacco,
			 after tobacco products.
						(B)ReportsSection
			 5722 of such Code is amended by inserting , processed tobacco,
			 after tobacco products.
						(3)RecordsSection
			 5741 of such Code is amended by inserting , processed tobacco,
			 after tobacco products.
					(4)Manufacturer of
			 processed tobaccoSection 5702 of such Code is amended by adding
			 at the end the following new subsection:

							(p)Manufacturer of
				processed tobacco
								(1)In
				generalThe term manufacturer of processed tobacco
				means any person who processes any tobacco other than tobacco products.
								(2)Processed
				tobaccoThe processing of tobacco shall not include the farming
				or growing of tobacco or the handling of tobacco solely for sale, shipment, or
				delivery to a manufacturer of tobacco products or processed
				tobacco.
								.
					(5)Conforming
			 amendmentSection 5702(k) of such Code is amended by inserting
			 , or any processed tobacco, after nontaxpaid tobacco
			 products or cigarette papers or tubes.
					(6)Effective
			 dateThe amendments made by this subsection shall take effect on
			 January 1, 2008.
					(b)Basis for
			 denial, suspension, or revocation of permits
					(1)DenialParagraph
			 (3) of section 5712 of such Code is amended to read as follows:

							(3)such person
				(including, in the case of a corporation, any officer, director, or principal
				stockholder and, in the case of a partnership, a partner)—
								(A)is, by reason of
				his business experience, financial standing, or trade connections or by reason
				of previous or current legal proceedings involving a felony violation of any
				other provision of Federal criminal law relating to tobacco products, cigarette
				paper, or cigarette tubes, not likely to maintain operations in compliance with
				this chapter,
								(B)has been convicted
				of a felony violation of any provision of Federal or State criminal law
				relating to tobacco products, cigarette paper, or cigarette tubes, or
								(C)has failed to
				disclose any material information required or made any material false statement
				in the application
				therefor.
								.
					(2)Suspension or
			 revocationSubsection (b) of section 5713 of such Code is amended
			 to read as follows:

							(b)Suspension or
				revocation
								(1)Show cause
				hearingIf the Secretary has reason to believe that any person
				holding a permit—
									(A)has not in good
				faith complied with this chapter, or with any other provision of this title
				involving intent to defraud,
									(B)has violated the
				conditions of such permit,
									(C)has failed to
				disclose any material information required or made any material false statement
				in the application for such permit,
									(D)has failed to
				maintain his premises in such manner as to protect the revenue,
									(E)is, by reason of
				previous or current legal proceedings involving a felony violation of any other
				provision of Federal criminal law relating to tobacco products, cigarette
				paper, or cigarette tubes, not likely to maintain operations in compliance with
				this chapter, or
									(F)has been convicted
				of a felony violation of any provision of Federal or State criminal law
				relating to tobacco products, cigarette paper, or cigarette tubes,
									the
				Secretary shall issue an order, stating the facts charged, citing such person
				to show cause why his permit should not be suspended or revoked.(2)Action following
				hearingIf, after hearing, the Secretary finds that such person
				has not shown cause why his permit should not be suspended or revoked, such
				permit shall be suspended for such period as the Secretary deems proper or
				shall be
				revoked.
								.
					(c)Application of
			 Internal Revenue Code statute of limitations for alcohol and tobacco excise
			 taxesSection 514(a) of the Tariff Act of 1930 (19 U.S.C.
			 1514(a)) is amended by striking and section 520 (relating to
			 refunds) and inserting section 520 (relating to refunds), and
			 section 6501 of the Internal Revenue Code of 1986 (but only with respect to
			 taxes imposed under chapters 51 and 52 of such Code).
				(d)Expansion of
			 definition of roll-your-own tobacco
					(1)In
			 generalSection 5702(o) of the Internal Revenue Code of 1986 is
			 amended by inserting or cigars, or for use as wrappers thereof
			 before the period at the end.
					(2)Effective
			 dateThe amendment made by this subsection shall apply to
			 articles removed (as defined in section 5702(j) of the Internal Revenue Code of
			 1986) after December 31, 2007.
					(e)Time of tax for
			 unlawfully manufactured tobacco productsSection 5703(b)(2) of
			 such Code is amended by adding at the end the following new
			 subparagraph:

						(F)Special rule for
				unlawfully manufactured tobacco productsIn the case of any
				tobacco products, cigarette paper, or cigarette tubes produced in the United
				States at any place other than the premises of a manufacturer of tobacco
				products, cigarette paper, or cigarette tubes that has filed the bond and
				obtained the permit required under this chapter, tax shall be due and payable
				immediately upon
				manufacture.
						.
				703.Time for payment of corporate estimated
			 taxesSubparagraph (B) of
			 section 401(1) of the Tax Increase Prevention and Reconciliation Act of 2005 is
			 amended by striking 114.50 percent and inserting 113.25
			 percent.
			VIIIEffective
			 date
			801.Effective
			 date
				(a)In
			 generalUnless otherwise
			 provided in this Act, subject to subsection (b), the amendments made by this
			 Act shall take effect on October 1, 2007, and shall apply to child health
			 assistance and medical assistance provided on or after that date without regard
			 to whether or not final regulations to carry out such amendments have been
			 promulgated by such date.
				(b)Exception for State
			 legislationIn the case of a
			 State plan under title XIX or XXI of the Social Security Act, which the
			 Secretary determines requires State legislation in order for the plan to meet
			 the additional requirements imposed by an amendment made by this Act, 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 preceding 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.