H.R. 3200 , America's Affordable Health Choices Act of 2009, as introduced on July 14, 2009, was referred to the House Committees on Energy and Commerce, Ways and Means, Education and Labor, Oversight and Government Reform, and the Budget, 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. The Committees on Education and Labor and on Ways and Means each ordered reported, as amended, their versions of H.R. 3200 on July 17, 2009. The Committee on Energy and Commerce ordered reported, as amended its version on July 31, 2009. The Committees on Oversight and Government Reform and the Budget have not taken up the legislation for consideration. H.R. 3200 proposes sweeping reforms of the U.S. health insurance and health care system. H.R. 3200 contains three major Divisions, 18 Titles, 51 Subtitles and 284 Sections, including 34 Medicaid sections. These 356 different organizational components often are interlinked and interdependent so that provisions in one division or section are likely to affect provisions in another or several other sections. The three major components of H.R. 3200 are designated Divisions A, B, and C. Division A, "Affordable Health Care Choices," focuses on reducing the number of uninsured, restructuring the private health insurance market, setting minimum standards for health benefits, and providing financial assistance to certain individuals and, in some cases, small employers. Division B, "Medicare and Medicaid Improvements," proposes modifications to the largest two health insurance programs to make them consistent with the changes proposed in Division A and to amend other provisions in existing federal statute. Division B also introduces a number of technical changes intended to improve quality of care, reduce federal and state expenditures, and address coverage gaps for both Medicare and Medicaid. For Medicaid, among other major proposals, Division B would expand Medicaid eligibility for traditional and non-traditional (mostly childless adults) beneficiary categories up to 133⅓% of the Federal Poverty Level (FPL). Division C, "Public Health and Workforce Development," would amend and expand existing health professions and nursing workforce programs. This report provides a discussion of the Medicaid provisions contained in H.R. 3200 . The discussion incorporates amendments that were adopted by the House Committee on Energy and Commerce. The report is divided into seven major categories: Eligibility. Benefits. Financing. Waste, Fraud, and Abuse. Payments to Territories. Demonstrations and Pilot Programs. Miscellaneous. Each topic contains a brief summary of existing Medicaid law and related background to provide context for the discussion of changes proposed by H.R. 3200 . Medicaid is a means-tested entitlement program operated by states within broad federal guidelines. To qualify, an individual must meet both categorical (i.e., must be a member of a covered group such as children, pregnant women, families with dependent children, the elderly, or the disabled) and financial eligibility requirements. Medicaid's financial requirements place limits on the maximum amount of assets and income individuals may possess to participate in Medicaid. Additional guidelines specify how states should calculate these amounts. The specific asset and income limitations that apply to each eligibility group are set through a combination of federal parameters and state definitions. Consequently, these standards vary across states, and different standards apply to different population groups within states. Of the approximately 50 different eligibility "pathways" into Medicaid, some are mandatory while others may be covered at state option. Examples of groups that states must provide Medicaid to include pregnant women and children under age six with family income below 133% of the federal poverty level (FPL), and poor individuals with disabilities or poor individuals over age 64 who qualify for cash assistance under the SSI program. Examples of groups that states may choose to cover under Medicaid include pregnant women and infants with family income exceeding 133% FPL up to 185% FPL, and "medically needy" individuals who meet categorical requirements with income up to 133% of the maximum payment amount applicable under states' former Aid to Families with Dependent Children (AFDC) programs based on family size. "Childless adults" (nonelderly adults who are not disabled, not pregnant and not parents of dependent children), for example, are generally not eligible for Medicaid, regardless of their income. H.R. 3200 makes several changes to Medicaid eligibility. Among the provisions that would impact eligibility, the bill would add two new mandatory eligibility groups, and add two new optional eligibility groups. In addition, it would make several modifications to existing eligibility groups, and add provisions to facilitate outreach and enrollment in Medicaid, CHIP, and the Health Insurance Exchange. H.R. 3200 would add two new mandatory eligibility groups to the Medicaid statute. A new "non-traditional" group would include individuals under age 65 who are not otherwise eligible for Medicaid under existing eligibility categories (e.g., childless adults) with income up to 133⅓% of the federal poverty level as determined using methodologies and procedures specified by the Secretary of the Department of Health and Human Services (the Secretary) in consultation with the Health Choices Commissioner. (The Commissioner is primarily in charge of enforcing new private health insurance standards and would oversee the Health Insurance Exchange, as described in Sec. 142 of H.R. 3200 ). A new "traditional" group would include individuals under age 65 who would otherwise be eligible for Medicaid in existing eligibility categories, (e.g., children, pregnant women, families with dependent children, and those with disabilities), except they do not meet income standards in effect as of June 16, 2009. The upper income standard applicable to this new "traditional" group would also be 133⅓% of the federal poverty level. For both the new "non-traditional" and "traditional" groups, services provided to these individuals would be fully financed by the federal government (i.e., the applicable federal medical assistance percentage would be 100%) for the period 2013-2014, decreasing to 90% beginning in 2015. These groups would also include individuals covered under Medicaid waivers and those receiving coverage paid for with state only funds. The Medicaid statutory language that deems certain newborns to be eligible for Medicaid for up to one year would be extended to include children born in the U.S up to the first 60 days of life who do not have acceptable coverage upon birth. Benefits provided to such children would also be fully financed by the federal government (i.e., the applicable federal medical assistance percentage would be 100%) for the period 2013-2014, decreasing to 90% beginning in 2015. States would not be permitted to enroll non-traditional Medicaid eligibles in a managed care entity unless the state demonstrates that the entity has the capacity to meet the health, mental health, and substance abuse needs of such individuals. H.R. 3200 includes a provision that would require state Medicaid agencies to enter into a Medicaid memorandum of understanding (MOU) with the Health Choices Commissioner, acting in consultation with the Secretary, to coordinate implementation of the provisions on private health insurance, the Health Insurance Exchange, and health insurance premium credits with the Medicaid state plan to ensure the enrollment of Medicaid eligible individuals in acceptable coverage. Pursuant to this MOU, states would be required to accept without further determination the enrollment of traditional and non-traditional Medicaid eligible individuals (defined above) who are determined eligible by the Exchange. The state may conduct redeterminations of eligibility for these individuals consistent with the periodicity outlined in the MOU. States would be required to provide Medicaid coverage during a period of presumptive eligibility. Once such an individual has made an application for Medicaid, states must promptly make a determination of eligibility (and for subsequent redeterminations) in the same manner as if the individual had applied directly to the state for Medicaid coverage, and use the income-related information used by the Commissioner and provided to the state under the MOU for making presumptive eligibility determinations to the maximum extent feasible. If the Commissioner determines that a state Medicaid agency has the capacity to make determinations of eligibility for health insurance affordablity credits, then the MOU would provide for the following: (1) the state Medicaid agency must conduct such determinations for any Exchange-eligible individual who requests such a determination; (2) in the case that a state Medicaid agency determines that an Exchange-eligible individual is not eligible for affordability credits, the agency must forward the information on the basis of which such determination was made to the Commissioner; and (3) the Commissioner must reimburse the state Medicaid agency for the costs of conducting such determinations. In the case of a child born in the United States who at the time of birth is not otherwise covered under acceptable coverage, the child would be deemed to be a non-traditional Medicaid eligible and enrolled in Medicaid. For such children, the state would provide for a Medicaid eligibility determination not later than the date the child otherwise is covered under acceptable coverage (or, if earlier, the end of the month in which the 60-day period, beginning on the date of birth, ends). For such children who still do not have acceptable coverage at the end of the above defined period, the child would be deemed to be a traditional Medicaid eligible individual until such time as the child obtains acceptable coverage or the state otherwise determines the child to be eligible for the state Medicaid plan. As a condition of continued availability of federal Medicaid matching funds, states would not be permitted to adopt eligibility standards, methodologies, or procedures in their Medicaid or CHIP programs (including waivers) that would be more restrictive than those in effect as of June 16, 2009.