[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 1293 Introduced in Senate (IS)]







105th CONGRESS
  1st Session
                                S. 1293

 To improve the performance outcomes of the child support enforcement 
program in order to increase the financial stability and well-being of 
                         children and families.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            October 9, 1997

 Mr. Rockefeller (for himself and Ms. Snowe) introduced the following 
  bill; which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To improve the performance outcomes of the child support enforcement 
program in order to increase the financial stability and well-being of 
                         children and families.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Child Support Performance 
Improvement Act of 1997''.

SEC. 2. INCENTIVE PAYMENTS TO STATES.

    (a) In General.--Part D of title IV of the Social Security Act (42 
U.S.C. 651-669) is amended by inserting after section 458 the 
following:

``SEC. 458A. INCENTIVE PAYMENTS TO STATES.

    ``(a) In General.--In addition to any other payment under this 
part, the Secretary shall, subject to subsection (f), make an incentive 
payment to each State for each fiscal year in an amount determined 
under subsection (b).
    ``(b) Amount of Incentive Payment.--
            ``(1) In general.--The incentive payment for a State for a 
        fiscal year is equal to the sum of the applicable percentages 
        (determined in accordance with paragraph (3)) of the maximum 
        incentive amount for the State for the fiscal year, with 
        respect to each of the following measures of State performance 
        for the fiscal year:
                    ``(A) The paternity establishment performance 
                level.
                    ``(B) The support order performance level.
                    ``(C) The current payment performance level.
                    ``(D) The arrearage payment performance level.
                    ``(E) The cost-effectiveness performance level.
                    ``(F) Subject to section 2(d)(2)(C) of the Child 
                Support Performance Improvement Act of 1997, the 
                medical support performance level.
            ``(2) Maximum incentive amount.--
                    ``(A) In general.--For purposes of paragraph (1), 
                the maximum incentive amount for a State for a fiscal 
                year is--
                            ``(i) subject to subsection (e)(2), with 
                        respect to the performance measures described 
                        in subparagraphs (A), (B), and (C) of paragraph 
                        (1), 0.49 percent of the State collections base 
                        for the fiscal year;
                            ``(ii) subject to subsection (e)(2), with 
                        respect to the performance measures described 
                        in subparagraphs (D) and (E) of paragraph (1), 
                        0.37 percent of the State collections base for 
                        the fiscal year; and
                            ``(iii) with respect to the performance 
                        measure described in subparagraph (F), such 
                        percentage of the State collections base for 
                        the fiscal year as the Secretary by regulation 
                        may determine in accordance with subsection 
                        (e)(2).
                    ``(B) State collections base.--For purposes of 
                subparagraph (A), the State collections base for a 
                fiscal year is equal to the sum of--
                            ``(i) 2 times the sum of--
                                    ``(I) the total amount of support 
                                collected during the fiscal year under 
                                the State plan approved under this part 
                                in cases in which the support 
                                obligation involved is required to be 
                                assigned to the State pursuant to part 
                                A or E of this title or title XIX; and
                                    ``(II) the total amount of support 
                                collected during the fiscal year under 
                                the State plan approved under this part 
                                in cases in which the support 
                                obligation involved was so assigned 
                                but, at the time of collection, is not 
                                required to be so assigned; and
                            ``(ii) the total amount of support 
                        collected during the fiscal year under the 
                        State plan approved under this part in all 
                        other cases.
            ``(3) Determination of applicable percentages based on 
        performance levels.--
                    ``(A) Paternity establishment.--
                            ``(i) Determination of paternity 
                        establishment performance level.--The paternity 
                        establishment performance level for a State for 
                        a fiscal year is, at the option of the State, 
the IV-D paternity establishment percentage determined under section 
452(g)(2)(A) or the statewide paternity establishment percentage 
determined under section 452(g)(2)(B).
                            ``(ii) Determination of applicable 
                        percentage.--The applicable percentage with 
                        respect to a State's paternity establishment 
                        performance level is as follows:
      

------------------------------------------------------------------------
``If the paternity establishment performance level is:                  
-------------------------------------------------------  The applicable 
            At least:                 But less than:     percentage is: 
------------------------------------------------------------------------
80%..............................  ...................         100      
79%..............................  80%................         98       
78%..............................  79%................         96       
77%..............................  78%................         94       
76%..............................  77%................         92       
75%..............................  76%................         90       
74%..............................  75%................         88       
73%..............................  74%................         86       
72%..............................  73%................         84       
71%..............................  72%................         82       
70%..............................  71%................         80       
69%..............................  70%................         79       
68%..............................  69%................         78       
67%..............................  68%................         77       
66%..............................  67%................         76       
65%..............................  66%................         75       
64%..............................  65%................         74       
63%..............................  64%................         73       
62%..............................  63%................         72       
61%..............................  62%................         71       
60%..............................  61%................         70       
59%..............................  60%................         69       
58%..............................  59%................         68       
57%..............................  58%................         67       
56%..............................  57%................         66       
55%..............................  56%................         65       
54%..............................  55%................         64       
53%..............................  54%................         63       
52%..............................  53%................         62       
51%..............................  52%................         61       
50%..............................  51%................         60       
0%...............................  50%................         0.       
------------------------------------------------------------------------

                        Notwithstanding the preceding sentence, if the 
                        paternity establishment performance level of a 
                        State for a fiscal year is less than 50 percent 
                        but exceeds by at least 10 percentage points 
                        the paternity establishment performance level 
                        of the State for the immediately preceding 
                        fiscal year, then the applicable percentage 
                        with respect to the State's paternity 
                        establishment performance level is 50 percent.
                    ``(B) Establishment of child support orders.--
                            ``(i) Determination of support order 
                        performance level.--The support order 
                        performance level for a State for a fiscal year 
                        is the percentage of the total number of cases 
                        under the State plan approved under this part 
                        in which there is a support order during the 
                        fiscal year.
                            ``(ii) Determination of applicable 
                        percentage.--The applicable percentage with 
                        respect to a State's support order performance 
                        level is as follows:
      

------------------------------------------------------------------------
     ``If the support order performance level is:                       
-------------------------------------------------------  The applicable 
            At least:                 But less than:     percentage is: 
------------------------------------------------------------------------
80%..............................  ...................         100      
79%..............................  80%................         98       
78%..............................  79%................         96       
77%..............................  78%................         94       
76%..............................  77%................         92       
75%..............................  76%................         90       
74%..............................  75%................         88       
73%..............................  74%................         86       
72%..............................  73%................         84       
71%..............................  72%................         82       
70%..............................  71%................         80       
69%..............................  70%................         79       
68%..............................  69%................         78       
67%..............................  68%................         77       
66%..............................  67%................         76       
65%..............................  66%................         75       
64%..............................  65%................         74       
63%..............................  64%................         73       
62%..............................  63%................         72       
61%..............................  62%................         71       
60%..............................  61%................         70       
59%..............................  60%................         69       
58%..............................  59%................         68       
57%..............................  58%................         67       
56%..............................  57%................         66       
55%..............................  56%................         65       
54%..............................  55%................         64       
53%..............................  54%................         63       
52%..............................  53%................         62       
51%..............................  52%................         61       
50%..............................  51%................         60       
0%...............................  50%................         0.       
------------------------------------------------------------------------

                        Notwithstanding the preceding sentence, if the 
                        support order performance level of a State for 
                        a fiscal year is less than 50 percent but 
                        exceeds by at least 5 percentage points the 
                        support order performance level of the State 
                        for the immediately preceding fiscal year, then 
                        the applicable percentage with respect to the 
                        State's support order performance level is 50 
                        percent.
                    ``(C) Collections on current child support due.--
                            ``(i) Determination of current payment 
                        performance level.--The current payment 
                        performance level for a State for a fiscal year 
                        is equal to the total amount of current support 
                        collected during the fiscal year under the 
                        State plan approved under this part divided by 
                        the total amount of current support owed during 
                        the fiscal year in all cases under the State 
                        plan, expressed as a percentage.
                            ``(ii) Determination of applicable 
                        percentage.--The applicable percentage with 
                        respect to a State's current payment 
                        performance level is as follows:
      

------------------------------------------------------------------------
    ``If the current payment performance level is:                      
-------------------------------------------------------  The applicable 
            At least:                 But less than:     percentage is: 
------------------------------------------------------------------------
80%..............................  ...................         100      
79%..............................  80%................         98       
78%..............................  79%................         96       
77%..............................  78%................         94       
76%..............................  77%................         92       
75%..............................  76%................         90       
74%..............................  75%................         88       
73%..............................  74%................         86       
72%..............................  73%................         84       
71%..............................  72%................         82       
70%..............................  71%................         80       
69%..............................  70%................         79       
68%..............................  69%................         78       
67%..............................  68%................         77       
66%..............................  67%................         76       
65%..............................  66%................         75       
64%..............................  65%................         74       
63%..............................  64%................         73       
62%..............................  63%................         72       
61%..............................  62%................         71       
60%..............................  61%................         70       
59%..............................  60%................         69       
58%..............................  59%................         68       
57%..............................  58%................         67       
56%..............................  57%................         66       
55%..............................  56%................         65       
54%..............................  55%................         64       
53%..............................  54%................         63       
52%..............................  53%................         62       
51%..............................  52%................         61       
50%..............................  51%................         60       
49%..............................  50%................         59       
48%..............................  49%................         58       
47%..............................  48%................         57       
46%..............................  47%................         56       
45%..............................  46%................         55       
44%..............................  45%................         54       
43%..............................  44%................         53       
42%..............................  43%................         52       
41%..............................  42%................         51       
40%..............................  41%................         50       
0%...............................  40%................         0.       
------------------------------------------------------------------------

                        Notwithstanding the preceding sentence, if the 
                        current payment performance level of a State 
                        for a fiscal year is less than 40 percent but 
                        exceeds by at least 5 percentage points the 
                        current payment performance level of the State 
                        for the immediately preceding fiscal year, then 
                        the applicable percentage with respect to the 
                        State's current payment performance level is 50 
                        percent.
                    ``(D) Collections on child support arrearages.--
                            ``(i) Determination of arrearage payment 
                        performance level.--The arrearage payment 
                        performance level for a State for a fiscal year 
                        is equal to the total number of cases under the 
                        State plan approved under this part in which 
                        payments of past-due child support were 
                        received during the fiscal year and part or all 
                        of the payments were distributed to the family 
                        to whom the past-due child support was owed 
                        (or, if all past-due child support owed to the 
                        family was, at the time of receipt, subject to 
                        an assignment to the State, part or all of the 
                        payments were retained by the State) divided by 
                        the total number of cases under the State plan 
                        in which there is past-due child support, 
                        expressed as a percentage.
                            ``(ii) Determination of applicable 
                        percentage.--The applicable percentage with 
                        respect to a State's arrearage payment 
                        performance level is as follows:
      

------------------------------------------------------------------------
   ``If the arrearage payment performance level is:                     
-------------------------------------------------------  The applicable 
            At least:                 But less than:     percentage is: 
------------------------------------------------------------------------
80%..............................  ...................         100      
79%..............................  80%................         98       
78%..............................  79%................         96       
77%..............................  78%................         94       
76%..............................  77%................         92       
75%..............................  76%................         90       
74%..............................  75%................         88       
73%..............................  74%................         86       
72%..............................  73%................         84       
71%..............................  72%................         82       
70%..............................  71%................         80       
69%..............................  70%................         79       
68%..............................  69%................         78       
67%..............................  68%................         77       
66%..............................  67%................         76       
65%..............................  66%................         75       
64%..............................  65%................         74       
63%..............................  64%................         73       
62%..............................  63%................         72       
61%..............................  62%................         71       
60%..............................  61%................         70       
59%..............................  60%................         69       
58%..............................  59%................         68       
57%..............................  58%................         67       
56%..............................  57%................         66       
55%..............................  56%................         65       
54%..............................  55%................         64       
53%..............................  54%................         63       
52%..............................  53%................         62       
51%..............................  52%................         61       
50%..............................  51%................         60       
49%..............................  50%................         59       
48%..............................  49%................         58       
47%..............................  48%................         57       
46%..............................  47%................         56       
45%..............................  46%................         55       
44%..............................  45%................         54       
43%..............................  44%................         53       
42%..............................  43%................         52       
41%..............................  42%................         51       
40%..............................  41%................         50       
0%...............................  40%................         0.       
------------------------------------------------------------------------

                        Notwithstanding the preceding sentence, if the 
                        arrearage payment performance level of a State 
                        for a fiscal year is less than 40 percent but 
                        exceeds by at least 5 percentage points the 
                        arrearage payment performance level of the 
                        State for the immediately preceding fiscal 
                        year, then the applicable percentage with 
                        respect to the State's arrearage payment 
                        performance level is 50 percent.
                    ``(E) Cost-effectiveness.--
                            ``(i) Determination of cost-effectiveness 
                        performance level.--The cost-effectiveness 
                        performance level for a State for a fiscal year 
                        is equal to the total amount collected during 
                        the fiscal year under the State plan approved 
                        under this part divided by the total amount 
                        expended during the fiscal year under the State 
                        plan, expressed as a ratio.
                            ``(ii) Determination of applicable 
                        percentage.--The applicable percentage with 
                        respect to a State's cost-effectiveness 
                        performance level is as follows:
      

------------------------------------------------------------------------
   ``If the cost-effectiveness performance level is:                    
-------------------------------------------------------  The applicable 
            At least:                 But less than:     percentage is: 
------------------------------------------------------------------------
5.00.............................  ...................         100      
4.50.............................  4.99...............         90       
4.00.............................  4.50...............         80       
3.50.............................  4.00...............         70       
3.00.............................  3.50...............         60       
2.50.............................  3.00...............         50       
2.00.............................  2.50...............         40       
0.00.............................  2.00...............         0.       
------------------------------------------------------------------------

                    ``(F) Medical support.--Subject to section 
                2(d)(2)(C) of the Child Support Performance Improvement 
                Act of 1997, the medical support performance level for 
                a State for a fiscal year, and the applicable 
                percentage for a State with respect to such level, 
                shall be determined in accordance with regulations 
                implementing the recommendations required to be 
                included in the report submitted under section 
                2(d)(2)(B) of such Act.
    ``(c) Treatment of Interstate Collections.--In computing incentive 
payments under this section, support which is collected by a State at 
the request of another State shall be treated as having been collected 
in full by both States, and any amounts expended by a State in carrying 
out a special project assisted under section 455(e) shall be excluded.
    ``(d) Administrative Provisions.--The amounts of the incentive 
payments to be made to the States under this section for a fiscal year 
shall be estimated by the Secretary at or before the beginning of the 
fiscal year on the basis of the best information available, as obtained 
in accordance with section 452(a)(12). The Secretary shall make the 
payments for the fiscal year, on a quarterly basis (with each quarterly 
payment being made not later than the beginning of the quarter 
involved), in the amounts so estimated, reduced, or increased to the 
extent of any overpayments or underpayments which the Secretary 
determines were made under this section to the States involved for 
prior periods and with respect to which adjustment has not already been 
made under this subsection. Upon the making of any estimate by the 
Secretary under the preceding sentence, any appropriations available 
for payments under this section are deemed obligated.
    ``(e) Regulations.--
            ``(1) In general.--The Secretary shall prescribe such 
        regulations as may be necessary governing the calculation of 
        incentive payments under this section, including directions for 
        excluding from the calculations certain closed cases and cases 
        over which the States do not have jurisdiction, and regulations 
        excluding from the calculations of the current payment 
        performance level and the arrearage payment performance level 
        any case in which the State used State funds to make such 
        payments for the primary purpose of increasing the State's 
        performance levels in such areas.
            ``(2) Regulations implementing the medical support 
        performance level.--Subject to section 2(d)(2)(C) of the Child 
        Support Performance Improvement Act of 1997, the Secretary 
        shall prescribe regulations implementing the recommendations 
        required to be included in the report submitted under section 
        2(d)(2)(B) of such Act. To the extent necessary to ensure that 
        the implementation of such recommendations does not result in 
        total Federal expenditures under this section in excess of the 
        amount of such expenditures in the absence of such 
        implementation, such regulations may increase or decrease the 
        percentages specified in clauses (i) and (ii) of subsection 
        (b)(2)(A).
    ``(f) Reinvestment.--
            ``(1) In general.--Until such time as the State qualifies 
        for the maximum incentive amount possible, as determined under 
        subsection (b)(2), payments under this section and section 458 
        shall supplement, not supplant, State child support 
        expenditures under the State program under this part to the 
        extent that such expenditures were funded by the State in 
        fiscal year 1996.
            ``(2) Penalty.--Failure to satisfy the requirement of 
        paragraph (1) shall result in a proportionate reduction, 
        determined by the Secretary, of future payments to the State 
        under this section and section 458.''.
    (b) Payments During Transition Period.--Notwithstanding section 
458A of the Social Security Act (42 U.S.C. 658A), as added by 
subsection (a), the amount of an incentive payment for a State under 
such section shall not be--
            (1) in the case of fiscal year 2000, less than 80 percent 
        or greater than 120 percent of the incentive payment for the 
        State determined under section 458 of the Social Security Act 
        (42 U.S.C. 658) for fiscal year 1999 (as such section was in 
        effect for such fiscal year);
            (2) in the case of fiscal year 2001, less than 60 percent 
        or greater than 140 percent of the incentive payment for the 
        State (as so determined);
            (3) in the case of fiscal year 2002, less than 40 percent 
        or greater than 160 percent of the incentive payment for the 
        State (as so determined); and
            (4) in the case of fiscal year 2003, less than 20 percent 
        or greater than 180 percent of the incentive payment for the 
        State (as so determined).
    (c) Regulations.--Within 9 months after the date of enactment of 
this section, the Secretary of Health and Human Services shall 
prescribe regulations governing the implementation of section 458A of 
the Social Security Act, when such section takes effect, and the 
implementation of subsection (b) of this section.
    (d) Studies.--
            (1) General review of new incentive payment system.--
                    (A) In general.--The Secretary of Health and Human 
                Services (in this subsection referred to as the 
                ``Secretary'') shall conduct a study of the 
                implementation of the incentive payment system 
                established by section 458A of the Social Security Act, 
                in order to identify the problems and successes of the 
                system.
                    (B) Reports to congress.--
                            (i) Report on variations in state 
                        performance attributable to demographic 
                        variables.--Not later than October 1, 2000, the 
                        Secretary shall submit to Congress a report 
                        that identifies any demographic or economic 
                        variables that account for differences in the 
                        performance levels achieved by the States with 
                        respect to the performance measures used in the 
                        system, and contains the recommendations of the 
                        Secretary for such adjustments to the system as 
                        may be necessary to ensure that the relative 
                        performance of States is measured from a 
                        baseline that takes account of any such 
                        variables.
                            (ii) Interim report.--Not later than March 
                        1, 2001, the Secretary shall submit to Congress 
                        an interim report that contains the findings of 
                        the study required by subparagraph (A).
                            (iii) Final report.--Not later than October 
                        1, 2003, the Secretary shall submit to Congress 
                        a final report that contains the final findings 
                        of the study required by subparagraph (A). The 
                        report shall include any recommendations for 
                        changes in the system that the Secretary 
                        determines would improve the operation of the 
                        child support enforcement program.
            (2) Development of medical support incentive.--
                    (A) In general.--The Secretary, in consultation 
                with State directors of programs operated under part D 
                of title IV of the Social Security Act and 
                representatives of children potentially eligible for 
                medical support, such as child advocacy organizations, 
                shall develop a new medical support performance measure 
                based on the effectiveness of States in establishing 
                and enforcing medical support obligations, and shall 
                make recommendations for the incorporation of the 
                measure, in a revenue neutral manner, into the 
                incentive payment system established by section 458A of 
                the Social Security Act.
                    (B) Report.--Not later than October 1, 1998, the 
                Secretary shall submit to the Committee on Ways and 
                Means of the House of Representatives and the Committee 
                on Finance of the Senate, a report that describes the 
                performance measure and contains the recommendations 
                required under subparagraph (A).
                    (C) Congressional disapproval required.--
                            (i) In general.--The Secretary shall, by 
                        regulation, implement the recommendations 
                        required to be included in the report submitted 
                        under subparagraph (B) unless a joint 
                        resolution is enacted, in accordance with 
subparagraph (D), disapproving such recommendations before the end of 
the 1-year period that begins on the date on which the Secretary 
submits such report.
                            (ii) Exclusion of certain days.--For 
                        purposes of clause (i) and subparagraph (D), 
                        the days on which either House of Congress is 
                        not in session because of an adjournment of 
                        more than 3 days to a day certain shall be 
                        excluded from the computation of the period.
                    (D) Congressional consideration.--
                            (i) Terms of the resolution.--For purposes 
                        of subparagraph (C)(i), the term ``joint 
                        resolution'' means only a joint resolution that 
                        is introduced within the 1-year period 
                        described in such subparagraph and--
                                    (I) that does not have a preamble;
                                    (II) the matter after the resolving 
                                clause of which is as follows: ``That 
                                Congress disapproves the 
                                recommendations of the Secretary of 
                                Health and Human Services regarding the 
                                implementation of a medical support 
                                performance measure submitted on 
                                ____'', the blank space being filled in 
                                with the appropriate date; and
                                    (III) the title of which is as 
                                follows: ``Joint resolution 
                                disapproving the recommendations of the 
                                Secretary of Health and Human Services 
                                regarding the implementation of a 
                                medical support performance measure.''.
                            (ii) Referral.--A resolution described in 
                        clause (i) that is introduced--
                                    (I) in the House of 
                                Representatives, shall be referred to 
                                the Committee on Ways and Means; and
                                    (II) in the Senate, shall be 
                                referred to the Committee on Finance.
                            (iii) Discharge.--If a committee to which a 
                        resolution described in clause (i) is referred 
                        has not reported such resolution by the end of 
                        the 20-day period beginning on the date on 
                        which the Secretary submits the report required 
                        under subparagraph (B), such committee shall 
                        be, at the end of such period, discharged from 
                        further consideration of such resolution, and 
                        such resolution shall be placed on the 
                        appropriate calendar of the House involved.
                            (iv) Consideration.--On or after the third 
                        day after the date on which the committee to 
                        which a resolution described in clause (i) has 
                        reported, or has been discharged from further 
                        consideration of such resolution, such 
                        resolution shall be considered in the same 
                        manner as a resolution is considered under 
                        subsections (d), (e), and (f) of section 2908 
                        of the Defense Base Closure and Realignment Act 
                        of 1990 (10 U.S.C. 2687 note).
    (e) Technical Amendments.--
            (1) In general.--Section 341 of the Personal Responsibility 
        and Work Opportunity Reconciliation Act of 1996 (42 U.S.C. 658 
        note) is amended--
                    (A) by striking subsection (a) and redesignating 
                subsections (b), (c), and (d) as subsections (a), (b), 
                and (c), respectively; and
                    (B) in subsection (c) (as so redesignated)--
                            (i) by striking paragraph (1) and inserting 
                        the following:
            ``(1) Conforming amendments to present system.--The 
        amendments made by subsection (a) of this section shall become 
        effective with respect to a State as of the date the amendments 
        made by section 103(a) (without regard to section 116(a)(2)) 
        first apply to the State.''; and
                            (ii) in paragraph (2), by striking ``(c)'' 
                        and inserting ``(b)''.
            (2) Effective date.--The amendments made by this subsection 
        shall take effect as if included in the enactment of section 
        341 of the Personal Responsibility and Work Opportunity 
        Reconciliation Act of 1996.
    (f) Elimination of Predecessor Incentive Payment System.--
            (1) Repeal.--Section 458 of the Social Security Act (42 
        U.S.C. 658) is repealed.
            (2) Conforming amendments.--
                    (A) Section 458A of the Social Security Act (42 
                U.S.C. 658a) is redesignated as section 458.
                    (B) Paragraphs (1) and (2) of section 458(f) (as so 
                redesignated) are each amended by striking ``and 
                section 458''.
            (3) Effective date.--The amendments made by this subsection 
        shall take effect on October 1, 2003.
    (g) General Effective Date.--Except as otherwise provided in this 
section, the amendments made by this section shall take effect on 
October 1, 1999.

SEC. 3. DATA INTEGRITY.

    (a) Duty of the Secretary To Ensure Reliable Data.--Section 452(a) 
of the Social Security Act (42 U.S.C. 652(a)) is amended--
            (1) in paragraph (10), by striking ``and'' at the end;
            (2) in paragraph (11), by striking the period and inserting 
        ``; and''; and
            (3) by adding at the end the following:
            ``(12) ensure that data required for the operation of State 
        programs is complete and reliable by providing Federal 
        guidance, technical assistance, and monitoring.''.
    (b) Denying Incentive Payments When Federal Audits Find That Claims 
Are Based on Incomplete or Unreliable Data.--Section 409(a)(8)(A) of 
the Social Security Act (42 U.S.C. 609(a)(8)(A)) is amended by striking 
the period and inserting the following: ``, and, in addition to the 
reductions specified in subparagraph (B), no State shall be eligible 
for incentive payments pursuant to section 458 or 458A for any fiscal 
year in which its claim is based on data found to be incomplete or 
unreliable pursuant to an audit or audits conducted under section 
452(a)(4)(C).''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on October 1, 1999.
                                 <all>