[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5192 Introduced in House (IH)]







106th CONGRESS
  2d Session
                                H. R. 5192

 To amend titles XIX and XXI of the Social Security Act to improve the 
coverage of needy children under the State Children's Health Insurance 
               Program (SCHIP) and the Medicaid Program.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 14, 2000

 Mr. Weygand introduced the following bill; which was referred to the 
                         Committee on Commerce

_______________________________________________________________________

                                 A BILL


 
 To amend titles XIX and XXI of the Social Security Act to improve the 
coverage of needy children under the State Children's Health Insurance 
               Program (SCHIP) and the Medicaid Program.

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

SECTION 1. SHORT TITLE; REFERENCES IN ACT; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Medicaid and SCHIP 
Improvement and Flexibility Act of 2000''.
    (b) References to Social Security Act.--Except as otherwise 
expressly provided, whenever in this Act an amendment or repeal 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 a section or 
other provision of the Social Security Act.
    (c) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; references in Act; table of contents.
Sec. 2. Simplified outreach and enrollment.
Sec. 3. Family friendly coverage and enrollment.
Sec. 4. Expanded coverage options.
Sec. 5. Availability of fiscal year 1998 and fiscal year 1999 
                            allotments under SCHIP.
Sec. 6. Permitting increased share of SCHIP funds to be expended for 
                            prevention programs that ensure healthy 
                            childhoods and quality prenatal health 
                            care.
Sec. 7. Use of SCHIP funds for enhanced matching rate for coverage of 
                            additional children under the medicaid 
                            program.

SEC. 2. SIMPLIFIED OUTREACH AND ENROLLMENT.

    (a) Use of Uniform Application and Coordinated Enrollment 
Process.--
            (1) SCHIP program.--Section 2102 (42 U.S.C. 1397bb) is 
        amended by adding at the end the following new subsection:
    ``(d) Development and Use of Uniform Application Forms and 
Coordinated Enrollment Process.--A State child health plan shall 
provide, by not later than the first day of the first month that begins 
more than 6 months after the date of the enactment of this subsection, 
for--
            ``(1) the development and use of a uniform, simplified 
        application form which is used both for purposes of 
        establishing eligibility for benefits under this title and also 
        under title XIX; and
            ``(2) an enrollment process that is coordinated with that 
        under title XIX so that a family need only interact with a 
        single State agency in order to determine whether a child is 
        eligible for benefits under this title or title XIX and to 
        apply for such benefits.''.
            (2) Medicaid conforming amendment.--
                    (A) In general.--Section 1902(a) (42 U.S.C. 
                1396a(a)) is amended--
                            (i) by striking the period at the end of 
                        paragraph (65) and inserting ``; and'', and
                            (ii) by inserting after paragraph (65) the 
                        following new paragraph:
            ``(66) provide, by not later than the first day of the 
        first month that begins more than 6 months after the date of 
        the enactment of this paragraph, in the case of a State with a 
        State child health plan under title XXI for--
                    ``(A) the development and use of a uniform, 
                simplified application form which is used both for 
                purposes of establishing eligibility for benefits under 
                this title and also under title XXI; and
                    ``(B) establishment and operation of an enrollment 
                process that is coordinated with that under title XXI 
                so that a family need only interact with a single State 
                agency in order to determine whether a child is 
                eligible for benefits under this title or title XXI and 
                to apply for such benefits.''.
                    (B) Effective date.--The amendments made by 
                subparagraph (A) apply to calendar quarters beginning 
                more than 6 months after the date of the enactment of 
                this Act.
    (b) Financial Incentives To Promote Appropriate Enrollment.--
            (1) Expanded availability of funding for administrative 
        costs related to outreach and eligibility determinations.--
        Section 1931(h) (42 U.S.C. 1396u-1(h)), as amended by section 
602 of the Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act 
of 1999 (113 Stat. 1501A-394), as enacted into law by section 
1000(a)(6) of Public Law 106-113 is amended--
                    (A) in the matter preceding paragraph (1), by 
                striking ``Transitional'' and all that follows through 
                ``Costs'' and inserting ``Increased Federal Matching 
                Rate for Administrative Costs Related to Certain 
                Outreach and Eligibility Determinations'';
                    (B) in paragraph (2), by inserting ``either'' after 
                ``attributable'' and by inserting before the period at 
                the end the following: ``or to administrative costs of 
                determinations of the eligibility of children and 
                pregnant women for benefits under the State plan under 
                this title or title XXI, outreach to children and 
                pregnant women likely to be eligible for such benefits, 
                and such other outreach- and eligibility-related 
                activities as the Secretary may approve''; and
                    (C) by adding at the end the following new 
                paragraph:
            ``(4) Encouraging use of local and community-based 
        organizations in outreach and enrollment activities.--The 
        Secretary shall establish a procedure under which, if States do 
        not otherwise obligate the amounts made available under this 
        subsection, local and community-based public or nonprofit 
        organizations (including local and county governments, public 
        health departments, community health centers, children's 
        hospitals, and disproportionate share hospitals) may seek to 
        have administrative costs relating to outreach and enrollment 
        of children and pregnant women under this title and title XXI 
        be treated and reimbursed as administrative costs of a State 
        described in section 1903(a)(7), if such organizations have the 
        permission of the State involved. A State may require such an 
        organization to provide payment of such amounts as the State 
        would otherwise be responsible for in order to obtain payment 
        under this paragraph.''.
            (2) Use of 3 percent of schip funds at 90 percent federal 
        match for enrollment and outreach activities.--Section 2105(b) 
        (42 U.S.C. 1397ee(b)) is amended--
                    (A) by designating the matter following the dash as 
                a paragraph (1) with appropriate indentation and with 
                the heading ``(1) In general'';
                    (B) by inserting ``subject to paragraph (2)'' after 
                ``(a)'';
                    (C) by striking ``(1)'' and ``(2)'' and inserting 
                ``(A)'' and ``(B)'', respectively; and
                    (D) by adding at the end the following paragraph:
            ``(2) Special rule for certain enrollment and outreach 
        activities.--
                    ``(A) In general.--For purposes of subsection (a), 
                in the case of a State that meets the requirement of 
                subparagraph (B), and subject to subparagraph (C), the 
                `enhanced FMAP' is equal to 90 percent with respect to 
                amounts expended on enrollment and outreach activities.
                    ``(B) Requirements.--Subparagraph (A) shall only 
                apply to a State if the State meets the following 
                requirements:
                            ``(i) No asset test.--The State does not 
                        impose an asset test for eligibility under the 
                        State child health plan or under section 
                        1902(l) with respect to children.
                            ``(ii) Compliance with outstationing 
                        requirement.--The Secretary finds that the 
                        State is providing for the receipt and initial 
                        processing of applications of certain 
                        individuals at facilities defined as 
                        disproportionate share hospitals under section 
                        1923(a)(1)(A) and Federally-qualified health 
                        centers described in section 1905(1)(2)(B) 
                        consistent with the requirements of section 
                        1902(a)(55).
                            ``(iii) Compliance with simplified outreach 
                        and enrollment provisions.--The Secretary finds 
                        that the State is providing for outreach and 
                        enrollment under this title and title XIX 
                        consistent with the requirements of sections 
                        2102(c), 2102(d), and 1902(a)(66).
                            ``(iv) Allowing mail and telephone 
                        applications.--The State allows applications 
                        for children under this title and title XIX to 
                        be submitted by mail or through telephone.
                    ``(C) Limitation to 3 percent of annual 
                allotment.--Subparagraph (A) shall not apply to amounts 
                expended by a State in a fiscal year in excess of 3 
                percent of the amount of the amount of its allotment 
                under section 2104 for that fiscal year.''.
            (3) Effective date.--The amendments made by this subsection 
        take effect on the date of the enactment of this Act and apply 
        to expenditures made on or after the date of the enactment of 
        this Act.
    (d) Additional Entities Qualified To Determine Medicaid Presumptive 
Eligibility for Low-Income Children.--Section 1920A(b)(3)(A)(i) (42 
U.S.C. 1396r-1a(b)(3)(A)(i)) is amended--
            (1) by striking ``or (II)'' and inserting ``, (II)''; and
            (2) by inserting ``eligibility of a child for medical 
        assistance under the State plan under this title, or 
        eligibility of a child for child health assistance under the 
        program funded under title XXI, (III) is an elementary school 
        or secondary school, as such terms are defined in section 14101 
        of the Elementary and Secondary Education Act of 1965 (20 
        U.S.C. 8801), an elementary or secondary school operated or 
        supported by the Bureau of Indian Affairs, a State child 
        support enforcement agency, a child care resource and referral 
        agency, or a State office or private contractor that accepts 
        applications for or administers a program funded under part A 
        of title IV or that determines eligibility for any assistance 
        or benefits provided under any program of public or assisted 
housing that receives Federal funds, including the program under 
section 8 or any other section of the United States Housing Act of 1937 
(42 U.S.C. 1437 et seq.), or (IV) any other entity the State so deems'' 
before the semicolon.

SEC. 3. FAMILY FRIENDLY COVERAGE AND ENROLLMENT.

    (a) Prohibition of Waiting Periods.--
            (1) In general.--Section 2102(b)(1)(B) (42 U.S.C. 
        1397bb(b)(1)(B)) is amended--
                    (A) by striking ``and'' at the end of clause (i);
                    (B) by striking the period at the end of clause 
                (ii) and inserting ``; and''; and
                    (C) by adding at the end the following new clause:
                            ``(iii) shall not permit the use of any 
                        mandatory waiting period (including any such 
                        period in order to carry out paragraph (3)(C)), 
                        unless the Secretary finds that the imposition 
                        of such a period would not be contrary to the 
                        provisions of this title.''.
            (2) Effective date.--The amendments made by paragraph (1) 
        apply to assistance furnished on or after the date of the 
        enactment of this Act.
    (b) Grace Period Before Disenrollment for Nonpayment of Premiums.--
            (1) In general.--Section 2103(e) (42 U.S.C. 1397ee(e)) is 
        amended by adding at the end the following new paragraph:
            ``(5) Good cause waiver of disenrollment for nonpayment of 
        premiums.--The State child health plan shall establish rules 
        allowing waiver for good cause of termination of enrollment for 
        nonpayment of premiums and shall establish an appeals process 
        that includes a hearing and a 3-month grace period prior to 
        termination of coverage and includes waiver of any late payment 
        penalties when premium payments are made in full.''.
            (2) Effective date.--The amendment made by paragraph (1) 
        applies to disenrollments occurring on or after the date that 
        is 30 days after the date of the enactment of this Act.

SEC. 4. EXPANDED COVERAGE OPTIONS.

    (a) Automatic Reassessment of Eligibility for SCHIP and Medicaid 
Benefits for Children Losing Medicaid or SCHIP Eligibility.--
            (1) Loss of medicaid eligibility.--Section 1902(a)(66) (42 
        U.S.C. 1396a(a)(66)), as inserted by section 2(a)(2), is 
        amended--
                    (A) by striking ``and'' at the end of subparagraph 
                (B),
                    (B) by striking the period at the end of 
                subparagraph (C) and inserting ``; and''; and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(D) the automatic assessment, in the case of a 
                child who loses eligibility for medical assistance 
                under this title on the basis of changes in income, 
                assets, or age, of whether the child is eligible for 
                benefits under title XXI.''.
            (2) Loss of schip eligibility.--Section 2102(b)(3) (42 
        U.S.C. 1397bb(b)(3)) is amended by redesignating subparagraphs 
        (D) and (E) as subparagraphs (E) and (F), respectively, and by 
        inserting after subparagraph (C) the following new 
        subparagraph:
                    ``(D) that there is an automatic assessment, in the 
                case of a child who loses eligibility for child health 
                assistance under this title on the basis of changes in 
                income, assets, or age, of whether the child is 
eligible for medical assistance under title XIX;''.
            (3) Effective date.--The amendments made by paragraphs (1) 
        and (2) apply to children who lose eligibility under the 
        medicaid program under title XIX, or under a State child health 
        insurance plan under title XXI, respectively, of the Social 
        Security Act on or after the date that is 30 days after the 
        date of the enactment of this Act.
    (b) Optional Coverage of Low-Income, Uninsured Pregnant Women Under 
a State Child Health Plan.--
            (1) In general.--Title XXI is amended by adding at the end 
        the following new section:

``SEC. 2111. OPTIONAL COVERAGE OF LOW-INCOME, UNINSURED PREGNANT WOMEN.

    ``(a) Optional Coverage.--Notwithstanding any other provision of 
this title, a State child health plan may provide for coverage of 
pregnancy-related assistance for targeted low-income pregnant women in 
accordance with this section, but only if the State has established an 
income eligibility level under section 1902(l)(2)(A) for women 
described in section 1902(l)(1)(A) that is 185 percent of the income 
official poverty line.
    ``(b) Definitions.--For purposes of this section:
            ``(1) Pregnancy-related assistance.--The term `pregnancy-
        related assistance' has the meaning given the term child health 
        assistance in section 2110(a) as if any reference to targeted 
        low-income children were a reference to targeted low-income 
        pregnant women, except that the assistance shall be limited to 
        services related to pregnancy (which include prenatal, 
        delivery, and postpartum services) and to other conditions that 
        may complicate pregnancy and shall not include prepregnancy 
        services and supplies.
            ``(2) Targeted low-income pregnant woman.--The term 
        `targeted low-income pregnant woman' has the meaning given the 
        term targeted low-income child in section 2110(b) as if any 
        reference to a child were deemed a reference to a woman during 
        pregnancy and through the end of the month in which the 60-day 
        period (beginning on the last day of her pregnancy) ends.
    ``(c) References to Terms and Special Rules.--In the case of, and 
with respect to, a State providing for coverage of pregnancy-related 
assistance to targeted low-income pregnant women under subsection (a), 
the following special rules apply:
            ``(1) Any reference in this title (other than subsection 
        (b)) to a targeted low income child is deemed to include a 
        reference to a targeted low-income pregnant woman.
            ``(2) Any such reference to child health assistance with 
        respect to such women is deemed a reference to pregnancy-
        related assistance.
            ``(3) Any such reference to a child is deemed a reference 
        to a woman during pregnancy and the period described in 
        subsection (b)(2).
            ``(4) The medicaid applicable income level is deemed a 
        reference to the income level established under section 
        1902(l)(2)(A).
            ``(5) Subsection (a) of section 2103 (relating to required 
        scope of health insurance coverage) shall not apply insofar as 
        a State limits coverage to services described in subsection 
        (b)(1) and the reference to such section in section 2105(a)(1) 
        is deemed not to require, in such case, compliance with the 
        requirements of section 2103(a).
            ``(6) There shall be no exclusion of benefits for services 
        described in subsection (b)(1) based on any pre-existing 
        condition and no waiting period (including any waiting period 
        imposed to carry out section 2102(b)(3)(C)) shall apply.
    ``(d) No Impact on Allotments.--Nothing in this section shall be 
construed as affecting the amount of any initial allotment provided to 
a State under section 2104(b).
    ``(e) Application of Funding Restrictions.--The coverage under this 
section (and the funding of such coverage) is subject to the 
restrictions of section 2105(c).
    ``(f) Automatic Enrollment for Children Born to Women Receiving 
Pregnancy-Related Assistance.--Notwithstanding any other provision of 
this title or title XIX, if 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 children'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, in the case of a State that provides such 
assistance through the provision of medical assistance under a plan 
under title XIX, to have applied for medical assistance under such 
title and to have been found eligible for such assistance under such 
title) on the date of such birth and to remain eligible for such 
assistance until the child attains 1 year of age so long as the child 
is a member of the woman's household and the woman remains (or would 
remain if pregnant) eligible for such assistance.''.
            (2) State option to use enhanced fmap for coverage of 
        additional pregnant women under the medicaid program.--Section 
        1905 (42 U.S.C. 1396d) is amended--
                    (A) in subsection (b), by inserting ``and in the 
                case of a State plan that meets the condition described 
                in subsections (u)(1) and (u)(4)(A), with respect to 
                expenditures described in subsection (u)(4)(B) for the 
                State for a fiscal year'' after ``for a fiscal year,'';
                    (B) by redesignating paragraph (4) of subsection 
                (u) as paragraph (5); and
                    (C) by inserting after paragraph (3) of subsection 
                (u) the following new paragraph:
    ``(4)(A) The condition described in this subparagraph for a State 
plan is that the plan has established an income level under section 
1902(l)(2)(A) with respect to individuals described in section 
1902(l)(1)(A) that is 185 percent of the income official poverty line.
    ``(B) For purposes of subsection (b), the expenditures described in 
this paragraph are expenditures for medical assistance for women 
described in section 1902(l)(1)(A) whose income exceeds the income 
level established for such women under section 1902(l)(2)(A)(i) as of 
the date of the enactment of this paragraph but does not exceed 185 
percent of the income official poverty line.''.
            (3) Conforming amendments.--Section 2102(b)(1)(B) (42 
        U.S.C. 1397bb(b)(1)(B)) is amended--
                    (A) by striking ``and'' at the end of clause (i);
                    (B) by striking the period at the end of clause 
                (ii) 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 child who is pregnant, if the State 
                        provides for coverage of pregnancy-related 
                        assistance for targeted low-income pregnant 
                        women in accordance section 2111.''.
            (4) Effective date.--The amendments made by this subsection 
        take effect on the date of the enactment of this Act and apply 
        to allotments for all fiscal years.
    (c) State Option for Coverage of Qualified Alien Children Under 
Medicaid and Children's Health Insurance Programs.--
            (1) Medicaid.--
                    (A) Categorically needy.--Section 
                1902(a)(10)(a)(ii) (42 U.S.C. 1396a(a)(10)(A)(ii)) is 
                amended--
                            (i) by striking ``or'' at the end of 
                        subclause (XIII);
                            (ii) by adding ``or'' at the end of 
                        subclause (XIV); and
                            (iii) by adding at the end the following 
                        new subclause:
                                    ``(XV) who are described in section 
                                1905(a)(i) and who would be eligible 
                                for medical assistance (or for a 
                                greater amount of medical assistance) 
                                under the State plan under this title 
                                but for the provisions of section 403 
                                or section 421 of Public Law 104-193, 
                                but the State may not exercise the 
                                option of providing medical assistance 
                                under this subclause with respect to a 
                                subcategory of individuals described in 
                                this subclause;''.
                    (B) Medically needy.--Section 1902(a)(10)(C)(i)(I) 
                (42 U.S.C. 1396a(a)(10)(C)(i)(I)) is amended by 
                inserting ``(and such criteria may provide for 
                eligibility of individuals described in subparagraph 
                (A)(ii)(XV))'' after ``medical assistance''.
            (2) Children's health insurance program.--Section 2110(b) 
        (42 U.S.C. 1397jj(b)) is amended--
                    (A) in paragraph (1)(A), by inserting before the 
                semicolon ``(including, at the option of the State, a 
                child described in paragraph (3)(B))''; and
                    (B) in paragraph (3)--
                            (i) by striking ``Special rule.--'' and 
                        inserting ``Special rules.--
                            ``(i) Health insurance coverage.--'' by 
                        indenting the remainder of the text 
                        accordingly; and
                            (ii) by adding at the end the following new 
                        subparagraph:
                    ``(B) Eligibility for qualified alien children.--
                For purposes of paragraph (1)(A), a child is described 
                in this subparagraph if--
                            ``(i) the child would be determined 
                        eligible for child health assistance under this 
                        title but for any or all of the provisions of 
                        sections 403 and 421 of Public Law 104-193; and
                            ``(ii) the State exercises the option to 
                        provide medical assistance to the category of 
                        individuals described in section 
                        1902(a)(10)(A)(ii)(XV).''.
            (3) Prohibition on seeking support from sponsor.--Section 
        213A(b) of the Immigration and Nationality Act (8 U.S.C. 
        1183a(b)) is amended by adding at the end the following new 
        paragraph:
            ``(4) Exception for child medicaid or schip assistance.--
        The preceding provisions of this subsection shall not apply 
        to--
                    ``(A) medical assistance furnished under the State 
                plan under title XIX of the Social Security Act to an 
                individual eligible for such assistance because of 
                subclause (XV) of paragraph (10)(A)(ii) of section 
                1902(a) of such Act (42 U.S.C. 1396a(a)) or because of 
                the reference to such subclause in paragraph (10)(C) of 
                such section; or
                    ``(B) child health assistance furnished under the 
                State child health plan under title XXI of such Act to 
                a child eligible for such assistance because of the 
                provisions of section 2110(b)(3)(B) of such Act (42 
                U.S.C. 1397jj(b)(3)(B)).''.
    (d) Elimination of Funding Offset for Exercise of Presumptive 
Eligibility Option.--
            (1) In general.--Section 2104(d) (42 U.S.C. 1397dd(d)) is 
        amended by striking ``shall be reduced by the sum of'' and all 
        that follows through ``(2) the amount of payments under such 
        section'' and inserting ``shall be reduced by the amount of 
        payments under section 1903(a)(1)''.
            (2) Effective date.--The amendment made by paragraph (1) 
        first applies for allotments for fiscal year 2001.
    (f) Program Coordination With the Maternal and Child Health Program 
(Title V).--
            (1) In general.--Section 2102(b)(3) (42 U.S.C. 
        1397bb(b)(3)) is amended--
                    (A) by striking ``and'' at the end of subparagraph 
                (D);
                    (B) by striking the period at the end of 
                subparagraph (E) and inserting ``; and''; and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(F) that operations and activities under this 
                title are developed and implemented in consultation and 
                coordination with the program operated by the State 
                under title V in areas including outreach and 
                enrollment, benefits and services, service delivery 
                standards, public health and social service agency 
                relationships, and quality assurance and data 
                reporting.''.
            (2) Conforming medicaid amendment.--Section 1902(a)(11) (42 
        U.S.C. 1306a(a)(11)) is amended--
                    (A) by striking ``and'' before ``(C)''; and
                    (B) by inserting before the semicolon at the end 
                the following: ``, and (D) provide that operations and 
                activities under this title are developed and 
                implemented in consultation and coordination with the 
                program operated by the State under title V in areas 
                including outreach and enrollment, benefits and 
                services, service delivery standards, public health and 
                social service agency relationships, and quality 
                assurance and data reporting''.
            (3) Effective date.--The amendments made by this subsection 
        take effect on January 1, 2001.

SEC. 5. AVAILABILITY OF FISCAL YEAR 1998 AND FISCAL YEAR 1999 
              ALLOTMENTS UNDER SCHIP.

    Notwithstanding subsection (e) of section 2104 of the Social 
Security Act (42 U.S.C. 1397dd), amounts allotted to a State under that 
section for each of fiscal years 1998 and 1999 shall remain available 
through September 30, 2002.

SEC. 6. PERMITTING INCREASED SHARE OF SCHIP FUNDS TO BE EXPENDED FOR 
              PREVENTION PROGRAMS THAT ENSURE HEALTHY CHILDHOODS AND 
              QUALITY PRENATAL HEALTH CARE.

    Section 2105(c)(2) (42 U.S.C. 1397ee(c)(2)) is amended by adding at 
the end the following new subparagraph:
                    ``(C) Exception for outreach and prevention 
                programs in states with substantial enrollment and that 
                would not otherwise use full allotment.--
                            ``(i) In general.--In the case of a State 
                        described in clause (ii)--
                                    ``(I) the limitation under 
                                subparagraph (A) on expenditures for 
                                items described in subparagraphs (B) or 
                                (C) of subsection (a)(2) shall not 
                                apply, but only up to 30 percent of the 
                                sum described in subparagraph (A); and
                                    ``(II) in applying subparagraph (B) 
                                of subsection (a)(2), activities 
                                undertaken by the State in conjunction 
                                with the Centers for Disease Control 
                                and Prevention to carry out 
activities to promote health pregnancies and healthy children shall be 
treated as expenditures described in such subparagraph, subject to the 
limitation under subclause (I) of this clause.
                            ``(ii) State described.--A State described 
                        in this clause is a State that establishes to 
                        the satisfaction of the Secretary that--
                                    ``(I) the State provides for an 
                                income level under section 
                                2110(b)(1)(B)(i)(I) that is not less 
                                than 200 percent of the poverty line;
                                    ``(II) the State does not provide 
                                for any waiting list for enrollment 
                                under this title;
                                    ``(III) the State has enrolled 
                                under this title and title XIX at least 
                                70 percent of the children eligible for 
                                enrollment under such titles; and
                                    ``(IV) without the application of 
                                this subparagraph, the State will not 
                                be able to expend all the funds 
                                allotted to it under this title.
                        The Secretary may waive the requirement of 
                        subclause (III) where the State demonstrates to 
                        the satisfaction of the Secretary that the 
                        State has made all possible efforts to achieve 
                        the enrollment level specified in the 
                        subclause.
                            ``(iii) Public-private partnerships.--In 
                        conducting activities under clause (i), a State 
                        may build partnerships with outside 
                        organization whose primary goal involves the 
                        healthy development of mothers and children and 
                        may act to otherwise eradicate illnesses and 
                        environmental factors that impact these groups.
                            ``(iv) Additional payments.--The provisions 
                        of this subparagraph apply in addition to the 
                        expenditures permitted under subparagraph (A) 
                        for items described in subparagraphs (B) and 
                        (C) of subsection (a)(2).''.

SEC. 7. USE OF SCHIP FUNDS FOR ENHANCED MATCHING RATE FOR COVERAGE OF 
              ADDITIONAL CHILDREN UNDER THE MEDICAID PROGRAM.

    (a) In General.--Section 1905 (42 U.S.C. 1396d), as amended by 
section 4(b)(2), is amended--
            (1) in subsection (b), by striking ``or subsection (u)(3)'' 
        and inserting ``, subsection (u)(3), or subsection (u)(5)(A)''; 
        and
            (2) in subsection (u)--
                    (A) by redesignating paragraph (5) as paragraph 
                (6); and
                    (B) by inserting after paragraph (4) the following 
                new paragraph:
    ``(5)(A) For purposes of subsection (b), the expenditures described 
in this subparagraph are expenditures for medical assistance for 
waivered low-income children described in subparagraph (B) but--
            ``(i) only in the case of children residing in a State 
        described in subparagraph (C); and
            ``(ii) only to the extent the number of full-year 
        equivalent waivered low-income children enrolled under the 
        State plan under this title for the fiscal year exceeds the 
        number of waivered low-income children described in 
        subparagraph (D)(i) for the State for the fiscal year.
    ``(B) For purposes of this paragraph, the term `waivered low-income 
child' means a child whose family income exceeds the minimum income 
level required to be established for the age of such child under 
section 1902(l)(2) in order for the child to be eligible for medical 
assistance under this title, but does not exceed the medicaid 
applicable income level (as defined in section 2110(b)(4) but 
determined as if `June 1, 1997' were substituted for `March 31, 1997') 
for that child.
    ``(C) A State described in this subparagraph is a State that--
            ``(i) has under a waiver authorized by the Secretary or 
        under section 1902(r)(2) established and is using a medicaid 
        applicable income level (as defined in section 2110(b)(4) but 
        determined as if `June 1, 1997' were substituted for `March 31, 
        1997') for children under 19 years of age residing in the State 
        that is at or above 200 percent of the poverty line; and
            ``(ii) demonstrates to the satisfaction of the Secretary 
        that the State has taken all of the following actions to reach 
        and enroll children who are eligible for, but not enrolled 
        under, the State plan:
                    ``(I) Eliminating the assets test for eligibility 
                of waivered low-income children.
                    ``(II) Using shortened and simplified applications 
                for such children.
                    ``(III) Allowing applications for such children to 
                be submitted by mail or through telephone.
                    ``(IV) Outstationing State eligibility workers at 
                sites that are frequented by families with children, 
                including schools, child care centers, churches, 
                centers providing Head Start services, local offices of 
                the special supplemental food program for women, 
                infants and young children (WIC) established under 
                section 17 of the Child Nutrition Act of 1966, 
                community centers, Job Corps centers established under 
                part B of title IV of the Job Training Partnership Act 
                or subtitle C of title I of the Workforce Investment 
                Act of 1998, sites offering the recognized equivalent 
                of a secondary school degree, offices of tribal 
                organizations (as defined in section 4(l) of the Indian 
                Self-Determination and Education Assistance Act), and 
                Social Security Administration field offices.
                    ``(V) Using presumptive eligibility for waivered 
                low-income children.
                    ``(VI) Collaborating with public and private 
                entities to conduct outreach campaigns to enroll such 
                children.
    ``(D)(i) For purposes of subparagraph (A)(ii), the number of 
waivered low-income children for a State described in this clause for--
            ``(I) fiscal year 1998, is equal to the number of full-year 
        equivalent waivered low-income children enrolled under the 
        State plan under this title for fiscal year 1997; and
            ``(II) fiscal year 1999 or a succeeding fiscal year, is 
        equal to the number of waivered low-income children determined 
        under this clause for the preceding fiscal year increased by 
        the number of percentage points determined under clause (ii) 
        for the State for the fiscal year involved.
    ``(ii) The number of percentage points determined under this clause 
for a State for a fiscal year is equal to the number of percentage 
points by which--
            ``(I) the arithmetic average of the total number of 
        children in the State set forth in the 3 most recent March 
        supplements to the Current Population Survey of the Bureau of 
        the Census before the beginning of the fiscal year; exceeds
            ``(II) the arithmetic average of such total number set 
        forth in the second, third, and fourth most recent March 
        supplements to such Survey before the beginning of the fiscal 
        year.
    ``(E) Each State shall submit to the Secretary such information, at 
such time and in such manner, as the Secretary determines is necessary 
to ensure that the requirements of this paragraph are satisfied. The 
Secretary shall ensure that information is provided under this 
subsection in a manner that is consistent with other reporting 
requirements for information required to be submitted by a State under 
this title and title XXI, and avoids duplication of reporting 
requirements.
    ``(F) The Secretary shall regularly examine the payments made to a 
State for the expenditures described in subparagraph (A) to confirm 
that the payments are attributable to expenditures described in such 
subparagraph.''.
    (b) Conforming Amendment.--Section 1902(a)(10)(A)(ii)(XIV) (42 
U.S.C. 1396a(a)(10)(A)(ii)(XIV)) is amended by striking 
``1905(u)(2)(C)'' and inserting ``1905(u)(2)(B)''.
    (c) Effective Date.--The amendments made by this section shall be 
effective as if included in the enactment of section 4911 of the 
Balanced Budget Act of 1997 (Public Law 105-33; 111 Stat. 570).
                                 <all>