[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2147 Introduced in House (IH)]







110th CONGRESS
  1st Session
                                H. R. 2147

 To amend titles XXI and XIX of the Social Security Act to extend the 
   State Children's Health Insurance Program (SCHIP) and streamline 
 enrollment under SCHIP and Medicaid and to amend the Internal Revenue 
 Code of 1986 to provide for a healthy savings tax credit for purchase 
                     of children's health coverage.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 3, 2007

   Mr. Emanuel (for himself, Mr. Ramstad, Mr. LaHood, Mr. Ross, Ms. 
Schwartz, Ms. Shea-Porter, Mrs. Emerson, Mr. Kennedy, Mr. Courtney, Mr. 
    Platts, Mr. Schiff, Mrs. McCarthy of New York, Mr. McNulty, Mr. 
Alexander, Ms. Hirono, Ms. Berkley, Mr. Sarbanes, Mr. Cohen, Mr. Moran 
of Virginia, Ms. Norton, Mr. Jackson of Illinois, Mr. Davis of Alabama, 
  Mr. Smith of Washington, Mr. Kind, Mrs. Tauscher, Mr. Crowley, Mr. 
Rush, Mr. Hare, Mr. Higgins, Mr. Braley of Iowa, Mr. Snyder, Mr. Meeks 
of New York, and Mr. Cleaver) introduced the following bill; which was 
 referred to the Committee on Energy and Commerce, and in addition to 
   the Committee on Ways and Means, for a period to be subsequently 
   determined by the Speaker, in each case for consideration of such 
 provisions as fall within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
 To amend titles XXI and XIX of the Social Security Act to extend the 
   State Children's Health Insurance Program (SCHIP) and streamline 
 enrollment under SCHIP and Medicaid and to amend the Internal Revenue 
 Code of 1986 to provide for a healthy savings tax credit for purchase 
                     of children's health coverage.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS; FINDINGS.

    (a) Short Title.--This Act may be cited as the ``Healthy Kids Act 
of 2007''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents; findings.
                        TITLE I--SCHIP EXTENSION

Sec. 101.  Extension of SCHIP program.
Sec. 102. 1-year initial availability of SCHIP allotments.
Sec. 103. Redistribution of unused allotments to address State funding 
                            shortfalls.
        TITLE II--INCREASING ENROLLMENT UNDER SCHIP AND MEDICAID

Sec. 201. Bonus payments for States that implement administrative 
                            policies to streamline enrollment process.
Sec. 202. State option to provide for ``express lane'' and simplified 
                            determinations of a child's financial 
                            eligibility for medical assistance under 
                            Medicaid or child health assistance under 
                            SCHIP.
Sec. 203. Information technology connections to improve health coverage 
                            determinations.
Sec. 204. State option to expand or add coverage of certain pregnant 
                            women under SCHIP.
Sec. 205. Optional coverage of legal immigrants under the medicaid 
                            program and SCHIP.
Sec. 206. Authorizing adjustment of SCHIP allotment due to increased 
                            outreach.
Sec. 207. Grants to promote innovative outreach and enrollment under 
                            Medicaid and SCHIP.
Sec. 208. Model of Interstate coordinated enrollment and coverage 
                            process.
Sec. 209. Authority for qualifying States to use portion of SCHIP 
                            allotment for any fiscal year for certain 
                            medicaid expenditures.
Sec. 210. Application of medicaid outreach procedures to all pregnant 
                            women and children.
Sec. 211. No impact on section 1115 waivers.
Sec. 212. Elimination of counting medicaid child presumptive 
                            eligibility costs against title XXI 
                            allotment.
Sec. 213. Prohibiting limitations on enrollment.
                 TITLE III--HEALTHY SAVINGS TAX CREDIT

Sec. 301. Healthy savings tax credit.
     TITLE IV--BROKER REPORTING OF CUSTOMER'S BASIS IN SECURITIES 
                              TRANSACTIONS

Sec. 401. Broker reporting of customer's basis in securities 
                            transactions.
    (c) Findings Regarding the Need for Universal Health Coverage for 
Children.--Congress finds the following:
            (1) Currently, there are more than 9 million children who 
        are uninsured in the United States.
            (2) Approximately 75 percent of uninsured children are 
        eligible for Medicaid or the State Children's Health Insurance 
        Program (SCHIP).
            (3) As the wealthiest nation in the world, the United 
        States can and should be doing a better job to improve the 
        health of children.
            (4) In 2004, according to the World Health Organization, 
        the United States ranked 35th on infant mortality, behind Korea 
        and Cuba.
            (5) Two-thirds of nations have lower rates of children 
        dying from injuries than does the United States.
            (6) One-third of uninsured children in the United States 
        went without any medical care for the entire year in 2003, 
        while 88 percent of insured children received care.
            (7) Uninsured children more often have unmet health care 
        needs and delay seeking care, resulting in poorer health.
            (8) Uninsured children are less likely to have access to 
        and receive appropriate preventive care, such as immunizations, 
        hearing and vision screens, and monitoring of growth and 
        development.
            (9) Uninsured children are between three and five times 
        more likely to have an unmet medical need than are insured 
        children.
            (10) Uninsured children may delay necessary care because 
        they visit a doctor only when their care needs become urgent.
            (11) Uninsured children are four times more likely than 
        insured children to seek care in an emergency department with 
        conditions that could have been avoided.
            (12) The cost of unmet health needs among children extends 
        beyond measurable health system costs.
            (13) Recognizing that children whose parents have health 
        insurance are more likely to obtain preventive and necessary 
        care, many States are employing strategies to promote coverage 
        of the entire family and offer programs that leverage employer 
        sponsored insurance.
            (14) Problems that should be managed or cured with regular 
        access to health care result in lower school attendance.
            (15) In 2004, asthma alone accounted for an estimate 14 
        million lost school days among children.
            (16) Recurrent ear infections, which could be addressed 
        through regular access to health care, reduce children's 
        ability to communicate and thus school readiness and 
        performance.
    (d) Findings Regarding the Role of Medicaid and SCHIP in Covering 
Children.--Congress finds the following:
            (1) Since SCHIP was created, enormous progress has been 
        made in reducing disparities in children's coverage rates.
            (2) SCHIP and Medicaid have improved children's coverage 
        rates and access to needed health care services.
            (3) SCHIP and Medicaid account for the 30 percent decline 
        in the number of uninsured children since 1998, even as 
        employer-based coverage decreased and the overall rate of 
        uninsured people grew.
            (4) Children enrolled in SCHIP or Medicaid are three times 
        more likely to have a usual source of care than are uninsured 
        children.
            (5) SCHIP reduces the percent of children with an unmet 
        health care need.
            (6) According to a Federal evaluation of SCHIP, uninsured 
        children who gained coverage through SCHIP received more 
        preventive care, and their parents reported better access to 
        providers and improved communications with their children's 
        doctors.
            (7) SCHIP covers children who would otherwise be uninsured.
            (8) Most newly enrolled children in SCHIP were previously 
        uninsured or had recently lost their Medicaid or private health 
        coverage for involuntary reasons.
            (9) SCHIP established important strategies to avoid ``crowd 
        out'' of existing health insurance coverage, and research 
        suggests that these measures remain critical to the effective 
        use of public dollars.

                        TITLE I--SCHIP EXTENSION

SEC. 101. EXTENSION OF SCHIP PROGRAM.

    Section 2104 of the Social Security Act (42 U.S.C. 1397dd) is 
amended--
            (1) in subsection (a)--
                    (A) by striking ``and'' at the end of paragraph 
                (9);
                    (B) by striking the period at the end of paragraph 
                (10) and inserting ``; and''; and
                    (C) by adding at the end the following new 
                paragraph:
            ``(11) for each fiscal year 2008 and each subsequent fiscal 
        year, $7,500,000,000 multiplied by the population and cost 
        inflation factor for that fiscal year, as determined under 
        subsection (i).''; and
            (2) by adding at the end the following new subsection:
    ``(i) Population and Cost Inflation Factor.--For purposes of 
subsection (a)(11), the population and cost inflation factor for a 
fiscal year is equal to the product of the following:
            ``(1) Child population growth factor.--One plus the 
        percentage increase in the population of children under 20 
        years of age in the United States from July 1, 2007, to July 1 
        during the fiscal year involved, as projected by the Secretary 
        based on the most recent published estimates of the Bureau of 
        the Census before the beginning of the fiscal year involved.
            ``(2) Per capita health care growth factor.--One plus the 
        percentage increase in the projected per capita amount of 
        National Health Expenditures from fiscal year 2007 to the 
        fiscal year involved, as most recently published by the 
        Secretary before the beginning of the fiscal year involved.''.

SEC. 102. 1-YEAR INITIAL AVAILABILITY OF SCHIP ALLOTMENTS.

    Section 2104(e) of the Social Security Act (42 U.S.C. 1397dd(e)) is 
amended to read as follows:
    ``(e) Availability of Amounts Allotted.--
            ``(1) In general.--Except as provided in paragraphs (2) and 
        (3), amounts allotted to a State pursuant to this section--
                    ``(A) for each of fiscal years 1998 through 2007, 
                shall remain available for expenditure by the State 
                through the end of the second succeeding fiscal year; 
                and
                    ``(B) for fiscal year 2008 and each fiscal year 
                thereafter, shall remain available for expenditure by 
                the State through the end of the fiscal year involved.
            ``(2) Availability of amounts reallotted.--Subject to 
        paragraph (3), amounts reallotted to a State under subsection 
        (f) shall be available for expenditure by the State through the 
        end of the fiscal year in which they are reallotted.
            ``(3) Permanent availability of unused funds.--Reallotted 
        funds that are not used by the end of the fiscal year described 
        in paragraph (2) shall be subject to reallotment under 
        subsection (f) in subsequent fiscal years subject to such 
        paragraph and shall remain available for subsequent reallotment 
        until expended.''.

SEC. 103. REDISTRIBUTION OF UNUSED ALLOTMENTS TO ADDRESS STATE FUNDING 
              SHORTFALLS.

    Section 2104(f) of the Social Security Act (42 U.S.C. 1397dd(f)) is 
amended--
            (1) by striking ``The Secretary'' and inserting the 
        following:
            ``(1) In general.--The Secretary'';
            (2) by striking ``States that have fully expended the 
        amount of their allotments under this section'' and inserting 
        ``States that the Secretary determines with respect to the 
        fiscal year for which unused allotments are available for 
        redistribution under this subsection, are shortfall States 
        described in paragraph (2) for such fiscal year''; and
            (3) by adding at the end the following new paragraph:
            ``(2) Shortfall states described.--
                    ``(A) In general.--For purposes of paragraph (1), 
                with respect to a fiscal year, a shortfall State 
                described in this subparagraph is a State with a State 
                child health plan approved under this title for which 
                the Secretary estimates on the basis of the most recent 
                data available to the Secretary, that the projected 
                expenditures under such plan for the State for the 
                fiscal year will exceed the sum of--
                            ``(i) the amount of the State's allotments 
                        for any preceding fiscal years that remain 
                        available for expenditure and that will not be 
                        expended by the end of the immediately 
                        preceding fiscal year; and
                            ``(ii) the amount of the State's allotment 
                        for the fiscal year (taking into account any 
                        increase made in such allotment under section 
                        2104(j), as added by section 205(a) of the 
                        Healthy Kids Act of 2007).
                    ``(B) Proration rule.--If the amounts available for 
                redistribution under paragraph (1) for a fiscal year 
                are less than the total amounts of the estimated 
                shortfalls determined for the year under subparagraph 
                (A), the amount to be reallotted under such paragraph 
                for each shortfall State shall be reduced 
                proportionally.
                    ``(C) Retrospective adjustment.--The Secretary may 
                adjust the estimates and determinations made under 
                paragraph (1) and this paragraph with respect to a 
                fiscal year as necessary on the basis of the amounts 
                reported by States not later than November 30 of the 
                succeeding fiscal year, as approved by the 
                Secretary.''.

        TITLE II--INCREASING ENROLLMENT UNDER SCHIP AND MEDICAID

SEC. 201. BONUS PAYMENTS FOR STATES THAT IMPLEMENT ADMINISTRATIVE 
              POLICIES TO STREAMLINE ENROLLMENT PROCESS.

    (a) Bonus in FMAP and Enhanced FMAP for Application of Streamline 
Enrollment Procedures Under Medicaid and SCHIP.--Section 2102 of the 
Social Security Act (42 U.S.C. 1397bb) is amended by adding at the end 
the following new subsection:
    ``(d) Streamline Enrollment Procedures.--
            ``(1) Increase in federal matching rate.--
                    ``(A) In general.--In the case of a State that 
                meets the condition described in subparagraph (B) 
                (relating to agreeing to implement administrative 
                enrollment policies under this title and title XIX) for 
                a fiscal year, the Federal medical assistance 
                percentage (for purposes of title XIX only) and the 
                enhanced FMAP (for purposes of this title, but 
                determined without regard to the application of this 
                subsection to the Federal medical assistance percentage 
                under title XIX) otherwise computed for such fiscal 
                year as applied to medical assistance for children and 
                child health assistance, respectively, shall be 
                increased by 2 percentage points.
                    ``(B) Agreeing to remove enrollment and access 
                barriers.--The condition described in this 
                subparagraph, for a State for a fiscal year is that the 
                State agrees to do the following:
                            ``(i) Presumptive eligibility for 
                        children.--The State agrees--
                                    ``(I) to provide presumptive 
                                eligibility for children under this 
                                title and title XIX in accordance with 
                                section 1920A; and
                                    ``(II) to treat any items or 
                                services that are provided to an 
                                uncovered child (as defined in section 
                                2110(c)(8)) who is determined 
                                ineligible for medical assistance under 
                                title XIX as child health assistance 
                                for purposes of paying a provider of 
                                such items or services, so long as such 
                                items or services would be considered 
                                child health assistance for a targeted 
                                low-income child under this title.
                            ``(ii) 12-month continuous eligibility.--
                        The State agrees to provide that eligibility of 
                        children for assistance under this title and 
                        title XIX shall not be regularly redetermined 
                        more often than once every year.
                            ``(iii) Automatic renewal.--The State 
                        agrees to provide for the automatic renewal of 
                        the eligibility of children for assistance 
                        under this title and under title XIX if the 
                        child's family does not report any changes to 
                        family income or other relevant circumstances, 
                        subject to verification of information from 
                        databases available to the State for such 
                        purpose.
                            ``(iv) Elimination of asset test.--The 
                        State has amended its plans under this title 
                        and title XIX so that no asset or resource test 
                        is applied for eligibility under this title or 
                        title XIX with respect to children.
                            ``(v) Administrative verification of 
                        income.--The State agrees to permit the family 
                        of a child applying for child health assistance 
                        under this title or medical assistance under 
                        title XIX to declare and certify, by signature 
                        under penalty of perjury, the family income for 
                        purposes of collecting financial eligibility 
                        information.''.
    (b) Conforming Medicaid Amendments.--
            (1) In general.--Section 1905(b) of the Social Security Act 
        (42 U.S.C. 1396d(b)) is amended by inserting ``and section 
        2102(d)(1)'' after ``section 1933(d)''.
            (2) Increase in medicaid cap for territories.--Section 
        1108(g) of such Act (42 U.S.C. 1308(g)) is amended--
                    (A) in paragraph (2), by striking ``paragraph (3)'' 
                and inserting ``paragraphs (3) and (4)''; and
                    (B) by adding at the end the following new 
                paragraph:
            ``(4) Disregard of increased expenditures directly 
        attributable to increase in fmap for application of streamlined 
        enrollment procedures.--The limitation of paragraph (2) shall 
        not apply to payment under title XIX to a territory insofar as 
        such payment is attributable to an increase in the Federal 
        medical assistance percentage under subparagraph (A) of section 
        2102(d)(1).''.
    (c) Effective Date.--The amendments made by this section shall 
apply beginning with fiscal year 2007.

SEC. 202. STATE OPTION TO PROVIDE FOR ``EXPRESS LANE'' AND SIMPLIFIED 
              DETERMINATIONS OF A CHILD'S FINANCIAL ELIGIBILITY FOR 
              MEDICAL ASSISTANCE UNDER MEDICAID OR CHILD HEALTH 
              ASSISTANCE UNDER SCHIP.

    (a) Medicaid.--Section 1902(e) of the Social Security Act (42 
U.S.C. 1396a(e)) is amended by adding at the end the following:
    ``(13)(A) At the option of the State, the plan may provide that 
eligibility requirements (including such requirements applicable to 
redeterminations or renewals of eligibility) for medical assistance 
relating to income, assets (or resources), or citizenship status are 
met for a child who is under an age specified by the State (not to 
exceed 21 years of age) by using a determination made within a 
reasonable period (as determined by the State) before its use for this 
purpose, of the child's family or household income, or if applicable 
for purposes of determining eligibility under this title or title XXI, 
assets or resources, or citizenship status, respectively, 
(notwithstanding any other provision of law, including sections 
1902(a)(46)(B), 1903(x), and 1137(d)), by a Federal or State agency, or 
a public or private entity making such determination on behalf of such 
agency, specified by the plan, including an agency administering the 
State program funded under part A of title IV, the Food Stamp Act of 
1977, the Richard B. Russell National School Lunch Act, or the Child 
Nutrition Act of 1966, notwithstanding any differences in budget unit, 
disregard, deeming, or other methodology, but only if--
            ``(i) the agency has fiscal liabilities or responsibilities 
        affected by such determination; and
            ``(ii) the agency or entity notifies the child's family--
                    ``(I) of the information which shall be disclosed 
                in accordance with this subparagraph;
                    ``(II) that the information disclosed will be used 
                solely for purposes of determining eligibility for 
                medical assistance under this title or for child health 
                assistance under title XXI; and
                    ``(III) that interagency agreements limit the use 
                of such information to that purpose; and
            ``(iii) the requirements of section 1939 are satisfied.
    ``(B) Nothing in this paragraph shall be construed to relieve a 
State of the obligation to determine, on another basis, eligibility for 
medical assistance under this title or for child health assistance 
under title XXI if a child is determined ineligible for such assistance 
on the basis of information furnished pursuant to this paragraph.
    ``(C) If a State applies the eligibility process described in 
subparagraph (A) to individuals eligible under this title and to 
individuals eligible under title XXI, the State may, at its option, 
implement its duties under subparagraphs (A) and (B) of section 
2102(b)(3) using either or both of the following approaches:
            ``(i) The State may--
                    ``(I) establish a threshold percentage of the 
                Federal poverty level (that shall exceed the income 
                eligibility level applicable for a population of 
                individuals under this title by 30 percentage points 
                (as a fraction of the Federal poverty level) or such 
                other higher number of percentage points as the State 
                determines reflects the typical application of income 
                methodologies by the non-health program and the State 
                plan under this title); and
                    ``(II) provide that, with respect to any individual 
                within such population whom a non-health agency 
                determines has income that does not exceed such 
                threshold percentage for such population, such 
                individual is eligible for medical assistance under 
                this title (regardless of whether such individual would 
                otherwise be determined to be eligible to receive such 
                assistance).
        In exercising the approach under this clause, a State shall 
        inform families whose children are enrolled in a State child 
        health plan under title XXI based on having family income above 
        the threshold described in subclause (I) that they may qualify 
        for medical assistance under this title and, at their option, 
        can seek a regular eligibility determination for such 
        assistance for their child.
            ``(ii) Regardless of whether a State otherwise provides for 
        presumptive eligibility under section 1920A, a State may 
        provide presumptive eligibility under this title, consistent 
        with subsection (e) of section 1920A, to a child who, based on 
        a determination by a non-health agency, would qualify for child 
        health assistance under a State child health plan under title 
        XXI. During such presumptive eligibility period, the State may 
        determine the child's eligibility for medical assistance under 
        this title, pursuant to subparagraph (A) of section 2102(b)(3), 
        based on telephone contact with family members, access to data 
        available in electronic or paper form, and other means of 
        gathering information that are less burdensome to the family 
        than completing an application form on behalf of the child. The 
        procedures described in the previous sentence may be used 
        regardless of whether the State uses similar procedures under 
        other circumstances for purposes of determining eligibility for 
        medical assistance under this title.
    ``(D) At the option of a State, the eligibility process described 
in subparagraph (A) may apply to an individual who is not a child.
    ``(E)(i) At the option of a State, an individual determined to be 
eligible for medical assistance or child health assistance pursuant to 
subparagraph (A), (C), or (D) or other procedures through which 
eligibility is determined based on data obtained from sources other 
than the individual may receive medical assistance under this title if 
such individual (or, in the case of an individual under age 19 (or if 
the State elects the option under subparagraph (A), age 20 or 21) who 
is not authorized to consent to medical care, the individual's parent, 
guardian, or other caretaker relative) has acknowledged notice of such 
determination and has consented to such eligibility determination. The 
State (at its option) may waive any otherwise applicable requirements 
for signatures by or on behalf of an individual who has so consented.
    ``(ii) In the case of an individual enrolled pursuant to clause 
(i), the State shall inform the individual (or, in the case of an 
individual under age 19 (or if the State elects the option under 
subparagraph (A), age 20 or 21), the individual's parent, guardian, or 
other caretaker relative) about the significance of such enrollment, 
including appropriate methods to access covered services.
    ``(F) For purposes of this paragraph--
            ``(i) the term `non-health agency' means an agency or 
        entity described in subparagraph (A); and
            ``(ii) the term `non-health benefits' means the benefits or 
        assistance provided by a non-health agency.''.
    (b) SCHIP.--Section 2107(e)(1) of such Act (42 U.S.C. 1397gg(e)(1)) 
is amended by redesignating subparagraphs (B) through (E) as 
subparagraphs (C) through (F) and by inserting after subparagraph (B) 
the following new subparagraph:
                    ``(C) Section 1902(e)(13) (relating to the State 
                option to base a determination of a child's eligibility 
                for assistance on determinations made by a program 
                providing nutrition or other public assistance (except 
                that the State option under subparagraph (D) of such 
                section shall apply under this title only if an 
                individual is pregnant)).''.
    (c) Presumptive Eligibility.--Section 1920A of such Act (42 U.S.C. 
1396r-1a) is amended--
            (1) in subsection (b)(3)(A)(i), is amended by striking ``or 
        (IV)'' and inserting ``(IV) is an agency or entity described in 
        section 1902(e)(13)(A), or (V)''; and
            (2) by adding at the end the following:
    ``(e) In the case of a State with a child health plan under title 
XXI that provides for presumptive eligibility under such plan for 
children, the State shall make a reasonable effort to place each 
presumptively eligible child in the program under this title or title 
XXI for which the child appears most likely to qualify. During the 
child's period of presumptive eligibility, the State shall receive 
Federal matching funds under section 1903 or section 2105, depending on 
the program in which the child has been placed. If at the conclusion of 
such period, the child is found to qualify for, and is enrolled in, the 
program established under this title or title XXI when the child was 
enrolled in the program under the other such title during such period, 
the State's receipt of Federal matching funds shall be adjusted both 
retroactively and prospectively so that Federal matching funds are 
provided, both during and following such period of presumptive 
eligibility, based on the program in which the child is enrolled.''.
    (d) Signature Requirements.--Section 1902(a) of such Act (42 U.S.C. 
1396a(a)) is amended by adding at the end the following: 
``Notwithstanding any other provision of law, a signature under penalty 
of perjury shall not be required on an application form for medical 
assistance as to any element of eligibility for which eligibility is 
based on information received from a source other than applicant, 
rather than on representations from the applicant. Notwithstanding any 
other provision of law, any signature requirement for an application 
for medical assistance may be satisfied through an electronic 
signature, as defined in section 1710(1) of the Government Paperwork 
Elimination Act (44 U.S.C. 3504 note).''.

SEC. 203. INFORMATION TECHNOLOGY CONNECTIONS TO IMPROVE HEALTH COVERAGE 
              DETERMINATIONS.

    (a) Enhanced Federal Funding for Improvements Related to 
Implementation of Certain Model Outreach and Enrollment Practices.--
            (1) In general.--Section 1903(a)(3)(A) of the Social 
        Security Act (42 U.S.C. 1396b(a)(3)(A)) is amended--
                    (A) by striking ``and'' at the end of clause (i); 
                and
                    (B) by adding at the end the following new clause:
                    ``(iii) 75 percent of so much of the sums expended 
                during such quarter as are attributable to the design, 
                development, or installation of such mechanized claims 
                processing and information retrieval systems and the 
                implementation of administrative systems and processes 
                (including modification of eligibility computer systems 
                to permit the exchange of electronic information with 
                other Federal or State programs) as the Secretary 
                determines are directly related to the implementation 
                of a model outreach and enrollment practice described 
                in subparagraph (B), (C), (D), (E), or (F) of section 
                1905(y)(3), and''.
            (2) Conforming amendment to ensure availability for 
        territories.--Section 1108(g) of such Act (42 U.S.C. 1308(g)), 
        as amended by section 201(b)(2)(B), is amended--
                    (A) in paragraph (2), by striking ``and (4)'' and 
                inserting ``, (4), and (5)''; and
                    (B) by adding at the end the following new 
                paragraph:
            ``(5) Additional increase for certain expenditures.--With 
        respect to fiscal year 2008 and each fiscal year thereafter, if 
        Puerto Rico, the Virgin Islands, Guam, the Northern Mariana 
        Islands, or American Samoa qualify for a payment under section 
        1903(a)(3)(A)(iii) for a calendar quarter of such fiscal year, 
        the additional Federal financial participation under such 
        section shall not be counted towards the limitation on 
        expenditures under title XIX for such commonwealth or territory 
        otherwise determined under subsection (f) and this subsection 
        for such fiscal year.''.
    (b) Authorization of Information Disclosure.--
            (1) In general.--Title XIX of such Act (42 U.S.C. 1396 et 
        seq.) is amended--
                    (A) by redesignating section 1939 as section 1940; 
                and
                    (B) by inserting after section 1938 the following:

            ``authorization to receive pertinent information

    ``Sec. 1939.  (a) In General.--Notwithstanding any other provision 
of law, a Federal or State agency or private entity in possession of 
the sources of data potentially pertinent to eligibility determinations 
under this title or title XXI (including eligibility files maintained 
by programs described in section 1902(e)(13)(A), information described 
in paragraph (2) or (3) of section 1137(a), vital records information 
about births in any State, and information described in sections 453(i) 
and 1902(a)(25)(I)) is authorized to convey such data or information to 
a State agency administering a State plan under this title or title 
XXI, if--
            ``(1) such data or information are used only to establish 
        or verify eligibility or provide coverage under this title or 
        title XXI; and
            ``(2) an interagency or other agreement, consistent with 
        standards developed by the Secretary, prevents the unauthorized 
        use, disclosure, or modification of such data and otherwise 
        meets applicable Federal requirements safeguarding privacy and 
        data security.
    ``(b) Requirements for Conveyance.--Data or information may be 
conveyed pursuant to this section only if the following requirements 
are met:
            ``(1) The individual whose circumstances are described in 
        the data or information (or such individual's parent, guardian, 
        caretaker relative, or authorized representative) has either 
        provided advance consent to disclosure or has not objected to 
        disclosure after receiving advance notice of disclosure and a 
        reasonable opportunity to object.
            ``(2) Such data or information are used solely for the 
        purposes of--
                    ``(A) identifying individuals who are eligible or 
                potentially eligible for assistance under this title or 
                title XXI and enrolling such individuals in the State 
                plans established under such titles; and
                    ``(B) verifying the eligibility of individuals for 
                assistance under the State plans established under this 
                title or title XXI.
            ``(3) An interagency or other agreement, consistent with 
        standards developed by the Secretary--
                    ``(A) prevents the unauthorized use, disclosure, or 
                modification of such data and otherwise meets 
                applicable Federal requirements safeguarding privacy 
                and data security; and
                    ``(B) requires the State agencies administering the 
                State plans established under this title and title XXI 
                to use the data and information obtained under this 
                section to seek to enroll individuals in such plans.
    ``(c) Criminal Penalty.--A person described in the subsection (a) 
who publishes, divulges, discloses, or makes known in any manner, or to 
any extent not authorized by Federal law, any information obtained 
under this section shall be fined not more than $1,000 or imprisoned 
not more than 1 year, or both for each such unauthorized activity.
    ``(d) Rule of Construction.--The limitations and requirements that 
apply to disclosure pursuant to this section shall not be construed to 
prohibit the conveyance or disclosure of data or information otherwise 
permitted under Federal law (without regard to this section).''.
            (2) Conforming amendment to assure access to national new 
        hires database.--Section 453(i)(1) of such Act (42 U.S.C. 
        653(i)(1)) is amended by striking ``and programs funded under 
        part A'' and inserting ``, programs funded under part A, and 
        State plans approved under title XIX or XXI''.
            (3) Conforming amendment to provide schip programs with 
        access to national income data.--Section 6103(l)(7)(D)(ii) of 
        the Internal Revenue Code of 1986 is amended by inserting ``or 
        title XXI'' after ``title XIX''.
            (4) Conforming amendment to provide access to data about 
        enrollment in insurance for purposes of evaluating applications 
        and for schip.--Section 1902(a)(25)(I)(i) of the Social 
        Security Act (42 U.S.C. 1396a(a)(25)(I)(i)) is amended--
                    (A) by inserting ``(and, at State option, 
                individuals who are potentially eligible or who 
                apply)'' after ``with respect to individuals who are 
                eligible''; and
                    (B) by inserting ``under this title (and, at State 
                option, child health assistance under title XXI)'' 
                after ``the State plan''.

SEC. 204. STATE OPTION TO EXPAND OR ADD COVERAGE OF CERTAIN PREGNANT 
              WOMEN UNDER SCHIP.

    (a) SCHIP.--
            (1) Coverage.--Title XXI of the Social Security Act (42 
        U.S.C. 1397aa et seq.) is amended by adding at the end the 
        following new section:

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

    ``(a) Optional Coverage.--Notwithstanding any other provision of 
this title, a State may provide for coverage, through an amendment to 
its State child health plan under section 2102, of pregnancy-related 
assistance for targeted low-income pregnant women in accordance with 
this section, but only if--
            ``(1) the State has established an income eligibility 
        level--
                    ``(A) for pregnant women under subsection 
                (a)(10)(A)(i)(III) or (l)(2)(A) of section 1902 that is 
                at least 185 percent of the poverty line; and
                    ``(B) for children under this title that is at 
                least 200 percent of the poverty line; and
            ``(2) the State meets the requirement of section 2105(i)(2) 
        (relating to no waiting list for children).
    ``(b) Definitions.--For purposes of this title:
            ``(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.
            ``(2) Targeted low-income pregnant woman.--The term 
        `targeted low-income pregnant woman' means a woman--
                    ``(A) during pregnancy and through the end of the 
                month in which the 60-day period (beginning on the last 
                day of her pregnancy) ends;
                    ``(B) whose family income exceeds 185 percent of 
                the poverty level applicable to a family of the size 
                involved, but does not exceed the income eligibility 
                level established under the State child health plan 
                under this title for a targeted low-income child; and
                    ``(C) who satisfies the requirements of paragraphs 
                (1)(A), (1)(C), (2), and (3) of section 2110(b).
    ``(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 in 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)(A).
            ``(4) In applying section 2102(b)(3)(B), any reference to 
        children found through screening to be eligible for medical 
        assistance under the State medicaid plan under title XIX is 
        deemed a reference to pregnant women.
            ``(5) There shall be no exclusion of benefits for services 
        described in subsection (b)(1) based on any preexisting 
        condition and no waiting period (including any waiting period 
        imposed to carry out section 2102(b)(3)(C)) shall apply.
            ``(6) In applying section 2103(e)(3)(B) in the case of a 
        pregnant woman provided coverage under this section, the 
        limitation on total annual aggregate cost-sharing shall be 
        applied to such pregnant woman.
            ``(7) In applying section 2104(i)--
                    ``(A) in the case of State which did not provide 
                for coverage for pregnant women under this title (under 
                a waiver or otherwise) during fiscal year 2007, the 
                allotment amount otherwise computed for the first 
                fiscal year in which the State elects to provide 
                coverage under this section shall be increased by an 
                amount (determined by the Secretary) equal to the 
                enhanced FMAP of the expenditures under this title for 
                such coverage, based upon projected enrollment and per 
                capita costs of such enrollment; and
                    ``(B) in the case of a State which provided for 
                coverage of pregnant women under this title for the 
                previous fiscal year--
                            ``(i) in applying paragraph (1)(B)(ii) of 
                        such section, there shall also be taken into 
                        account (in an appropriate proportion) the 
                        percentage increase in births in the United 
                        States for the relevant period; and
                            ``(ii) in applying paragraph (1)(C), 
                        pregnant women (and per capita expenditures for 
                        such women) shall be accounted for separately 
                        from children, but shall be included in the 
                        total amount of any allotment adjustment under 
                        such paragraph.
    ``(d) Automatic Enrollment for Children Born to Women Receiving 
Pregnancy-Related Assistance.--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 child's birth, the child shall be 
deemed to have applied for child health assistance under the State 
child health plan and to have been found eligible for such assistance 
under such plan or to have applied for medical assistance under title 
XIX and to have been found eligible for such assistance under such 
title, as appropriate, on the date of such birth and to remain eligible 
for such assistance until the child attains 1 year of age. During the 
period in which a child is deemed under the preceding sentence to be 
eligible for child health or medical assistance, the child health or 
medical assistance eligibility identification number of the mother 
shall also serve as the identification number of the child, and all 
claims shall be submitted and paid under such number (unless the State 
issues a separate identification number for the child before such 
period expires).''.
            (2) No cost-sharing for pregnancy-related benefits.--
        Section 2103(e)(2) of such Act (42 U.S.C. 1397cc(e)(2)) is 
        amended--
                    (A) in the heading, by inserting ``or pregnancy-
                related services'' after ``preventive services''; and
                    (B) by inserting before the period at the end the 
                following: ``or for pregnancy-related services''.
            (3) Additional amendment.--Section 2107(e)(1)(F) of such 
        Act (42 U.S.C. 1397gg(e)(1)(G)), as redesignated by section 
        202(b), is amended to read as follows:
                    ``(F) Sections 1920 and 1920A (relating to 
                presumptive eligibility for pregnant women and 
                children).''.
    (b) Amendments to Medicaid.--
            (1) Eligibility of a newborn.--Section 1902(e)(4) of such 
        Act (42 U.S.C. 1396a(e)(4)) is amended in the first sentence by 
        striking ``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) Application of qualified entities to presumptive 
        eligibility for pregnant women under medicaid.--Section 1920(b) 
        of such Act (42 U.S.C. 1396r-1(b)) is amended by adding after 
        paragraph (2) the following flush sentence:
``The term `qualified provider' includes a qualified entity, as defined 
in section 1920A(b)(3).''.

SEC. 205. OPTIONAL COVERAGE OF LEGAL IMMIGRANTS UNDER THE MEDICAID 
              PROGRAM AND SCHIP.

    (a) Medicaid Program.--Section 1903(v) of the Social Security Act 
(42 U.S.C. 1396b(v)) is amended--
            (1) in paragraph (1), by striking ``paragraph (2)'' and 
        inserting ``paragraphs (2) and (4)''; and
            (2) by adding at the end the following new paragraph:
    ``(4)(A) A State may elect (in a plan amendment under this title) 
to provide medical assistance under this title, notwithstanding 
sections 401(a), 402(b), 403, and 421 of the Personal Responsibility 
and Work Opportunity Reconciliation Act of 1996, for aliens who are 
lawfully residing in the United States (including battered aliens 
described in section 431(c) of such Act) and who are otherwise eligible 
for such assistance, within either or both of the following eligibility 
categories:
            ``(i) Pregnant women.--Women during pregnancy (and during 
        the 60-day period beginning on the last day of the pregnancy).
            ``(ii) Children.--Individuals under 21 years of age, 
        including optional targeted low-income children described in 
        section 1905(u)(2)(B).
    ``(B) In the case of a State that has elected to provide medical 
assistance to a category of aliens under subparagraph (A), no debt 
shall accrue under an affidavit of support against any sponsor of such 
an alien on the basis of provision of assistance to such category and 
the cost of such assistance shall not be considered as an unreimbursed 
cost.''.
    (b) SCHIP.--Section 2107(e)(1) of such Act (42 U.S.C. 
1397gg(e)(1)), as amended by sections 202(b) and 204(a)(3), is amended 
by redesignating subparagraphs (D) through (F) as subparagraph (E) 
through (G), respectively, and by inserting after subparagraph (C) the 
following new subparagraph:
                    ``(D) Section 1903(v)(4) (relating to optional 
                coverage of categories of lawfully residing immigrant 
                children), but only if the State has elected to apply 
                such section to the category of children under title 
                XIX.''.
    (c) Effective Date.--The amendments made by this section take 
effect on October 1, 2007, and apply to medical assistance and child 
health assistance furnished on or after such date.
    (d) Construction.--Nothing in this section shall be construed as 
affecting eligibility of aliens who are not lawfully residing in the 
United States to benefits under the Medicaid program under title XIX of 
the Social Security Act or under the State children's health insurance 
program (SCHIP) under title XXI of such Act.

SEC. 206. AUTHORIZING ADJUSTMENT OF SCHIP ALLOTMENT DUE TO INCREASED 
              OUTREACH.

    (a) In General.--Section 2104 of the Social Security Act (42 U.S.C. 
1397dd), as amended by section 101, is further amended by adding at the 
end the following new subsection:
    ``(j) Authorizing Allotment Adjustment Due to Increased Outreach.--
            ``(1) In general.--Notwithstanding the previous provisions 
        of this section, if the Secretary determines that--
                    ``(A) a State has an increase in the average number 
                of children enrolled under its State child health plan 
                in a fiscal year that exceeds the enrollment of 
                children projected under paragraph (2) for the State 
                for such fiscal year, and
                    ``(B) the total Federal expenditures under the 
                State child health plan (or waiver) under this title 
                exceeds the amount of the allotment made available to 
                the State for the fiscal year,
        the Secretary shall increase the allotment under this section 
        for the State for the fiscal year by the amount specified in 
        paragraph (3). There are hereby appropriated, out of any money 
        in the Treasury not otherwise appropriated, such sums as may be 
        necessary to provide for such increase in allotment.
            ``(2) Projected enrollment of children.--The projected 
        enrollment of children for a State under this paragraph for a 
        fiscal year is equal to the average number of children enrolled 
        under the State child health plan in fiscal year 2007 
        increased, for each subsequent fiscal year through the fiscal 
        year involved, by a factor equal to the population growth of 
        children in the State for such fiscal year, as projected by the 
        Secretary before the beginning of the fiscal year involved.
            ``(3) Amount of allotment increase.--
                    ``(A) In general.--Subject to subparagraph (B), the 
                amount of the allotment increase under this subsection 
                for a State for a fiscal year shall be an amount equal 
                to the product of--
                            ``(i) the number by which the average 
                        number of children enrolled under the State 
                        child health plan in the fiscal year exceeds 
                        the enrollment of children projected under 
                        paragraph (2) for such State for such fiscal 
                        year; and
                            ``(ii) the per capita expenditures for 
                        children under the State child health plan for 
                        the previous year, increased by the average 
                        annual rate of increase (for the three previous 
                        fiscal years) in the amount of such per capita 
                        expenditures.
                The amount of the allotment increase under this 
                subsection shall not be subject to administrative or 
                judicial review.
                    ``(B) Limitation.--
                            ``(i) In general.--Subject to clause (ii), 
                        in no case shall the sum of the allotment 
                        increases for all States under this subsection 
                        for a fiscal year exceed an amount equal to 20 
                        percent of the total Federal payments to all of 
                        the States otherwise made under this title for 
                        the fiscal year. If such sum exceeds such 
                        amount, subject to clause (ii), the allotment 
                        increase for each State under this subsection 
                        for the fiscal year shall be reduced in a pro 
                        rata manner in order that such sum does not 
                        exceed such amount.
                            ``(ii) Congressional approval of additional 
                        amounts.--If the Secretary estimates that the 
                        allotment increases that should be provided 
                        under this subsection, but for clause (i), 
                        would exceed the limitation established under 
                        such clause, the Secretary shall submit to 
                        Congress a request for supplemental 
                        appropriations for the purpose of meeting such 
                        shortfall.
            ``(4) Clarification.--An adjustment in an allotment shall 
        not be made under this subsection due to excess State 
        expenditures resulting from a growth in per capita costs, 
        increased reimbursement to providers, or other factors not 
        directly related to outreach to eligible, but previously 
        unenrolled children.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect beginning with allotments for fiscal year 2008.

SEC. 207. GRANTS TO PROMOTE INNOVATIVE OUTREACH AND ENROLLMENT UNDER 
              MEDICAID AND SCHIP.

    Title XXI of the Social Security Act (42 U.S.C. 1397aa et seq.), as 
amended by section 204(a), is amended by adding at the end the 
following:

``SEC. 2112. EXPANDED OUTREACH ACTIVITIES THROUGH GRANTS TO CONDUCT 
              INNOVATIVE OUTREACH AND ENROLLMENT EFFORTS.

    ``(a) In General.--The Secretary shall award grants to eligible 
entities to--
            ``(1) conduct innovative outreach and enrollment efforts 
        that are designed to increase the enrollment and participation 
        of eligible children under this title and title XIX; and
            ``(2) promote understanding of the importance of health 
        insurance coverage for prenatal care and children. `
    ``(b) Priority for Award of Grants.--
            ``(1) In general.--In making grants under subsection (a), 
        the Secretary shall give priority to--
                    ``(A) eligible entities that propose to target 
                geographic areas with high rates of--
                            ``(i) eligible but unenrolled children, 
                        including such children who reside in rural 
                        areas; or
                            ``(ii) racial and ethnic minorities and 
                        health disparity populations, including those 
                        proposals that address cultural and linguistic 
                        barriers to enrollment; and
                    ``(B) eligible entities that plan to engage in 
                outreach efforts with respect to individuals described 
                in subparagraph (A) and that are--
                            ``(i) Federal health safety net 
                        organizations; or
                            ``(ii) faith-based organizations or 
                        consortia.
    ``(c) Application.--An eligible entity that desires to receive a 
grant under subsection (a) shall submit an application to the Secretary 
in such form and manner, and containing such information, as the 
Secretary may decide. Such application shall include--
            ``(1) quality and outcomes performance measures to evaluate 
        the effectiveness of activities funded by a grant awarded under 
        this section to ensure that the activities are meeting their 
        goals; and
            ``(2) an assurance that the entity shall--
                    ``(A) conduct an assessment of the effectiveness of 
                such activities against such performance measures;
                    ``(B) cooperate with the collection and reporting 
                of enrollment data and other information determined as 
                a result of conducting such assessments to the 
                Secretary, in such form and manner as the Secretary 
                shall require; and
                    ``(C) conduct work under the grant in conjunction 
                with the States involved.
    ``(d) Dissemination of Enrollment Data and Information Determined 
From Effectiveness Assessments; Annual Report.--The Secretary shall--
            ``(1) disseminate to eligible entities and make publicly 
        available the enrollment data and information collected and 
        reported in accordance with subsection (c)(2)(B); and
            ``(2) submit an annual report to Congress on the outreach 
        activities funded by grants awarded under this section.
    ``(e) Supplement, Not Supplant.--Federal funds awarded under this 
section shall be used to supplement, not supplant, non-Federal funds 
that are otherwise available for activities funded under this section.
    ``(f) Definitions.--In this section:
            ``(1) Eligible entity.--The term `eligible entity' means 
        any of the following:
                    ``(A) A local government.
                    ``(B) A Federal health safety net organization.
                    ``(C) A national, local, or community-based public 
                or nonprofit private organization, including community 
                health workers.
                    ``(D) A faith-based organization or consortia, to 
                the extent that a grant awarded to such an entity is 
                consistent with the requirements of section 1955 of the 
                Public Health Service Act (42 U.S.C. 300x-65) relating 
                to a grant award to non-governmental entities.
                    ``(E) An elementary or secondary school.
            ``(2) Federal health safety net organization.--The term 
        `Federal health safety net organization' means--
                    ``(A) an Indian tribe, tribal organization, or an 
                urban Indian organization receiving funds under title V 
                of the Indian Health Care Improvement Act (25 U.S.C. 
                1651 et seq.), or an Indian Health Service provider;
                    ``(B) a Federally-qualified health center (as 
                defined in section 1905(l)(2)(B));
                    ``(C) a hospital defined as a disproportionate 
                share hospital for purposes of section 1923;
                    ``(D) a covered entity described in section 
                340B(a)(4) of the Public Health Service Act (42 U.S.C. 
                256b(a)(4)); and
                    ``(E) any other entity or a consortium that serves 
                children under a federally-funded program, including 
                the special supplemental nutrition program for women, 
                infants, and children (WIC) established under section 
                17 of the Child Nutrition Act of 1966 (42 U.S.C. 1786), 
                the head start and early head start programs under the 
                Head Start Act (42 U.S.C. 9801 et seq.), the school 
                lunch program established under the Richard B. Russell 
                National School Lunch Act, and an elementary or 
                secondary school.
            ``(3) Indians; indian tribe; tribal organization; urban 
        indian organization.--The terms `Indian', `Indian tribe', 
        `tribal organization', and `urban Indian organization' have the 
        meanings given such terms in section 4 of the Indian Health 
        Care Improvement Act (25 U.S.C. 1603).
    ``(g) Appropriation.--There is appropriated, out of any money in 
the Treasury not otherwise appropriated, $50,000,000 for each of fiscal 
years 2008 through 2012 for the purpose of awarding grants under this 
section. Amounts appropriated and paid under the authority of this 
section shall be in addition to amounts appropriated under section 2104 
and paid to States in accordance with section 2105, including with 
respect to expenditures for outreach activities in accordance with 
subsection (a)(1)(D)(iii) of such section.''.

SEC. 208. MODEL OF INTERSTATE COORDINATED ENROLLMENT AND COVERAGE 
              PROCESS.

    In order to assure continuity of coverage of low-income children 
under the Medicaid program and the State Children's Health Insurance 
Program (SCHIP), the Secretary of Health and Human Services, in 
consultation with State Medicaid and SCHIP directors, shall develop and 
disseminate a model process for the coordination of the enrollment and 
coverage under such programs of children who, because of migration of 
families, emergency evacuations, educational needs, or otherwise, 
frequently change their State of residency or otherwise are temporarily 
present outside of the State of their residency.

SEC. 209. AUTHORITY FOR QUALIFYING STATES TO USE PORTION OF SCHIP 
              ALLOTMENT FOR ANY FISCAL YEAR FOR CERTAIN MEDICAID 
              EXPENDITURES.

    Section 2105(g)(1)(A) of the Social Security Act (42 U.S.C. 
1397ee(g)(1)(A)), as amended by section 201(b) of the National 
Institutes of Health Reform Act of 2006 (Public Law 109-482) is amended 
by striking ``fiscal year 1998, 1999, 2000, 2001, 2004, 2005, 2006, or 
2007'' and inserting ``a fiscal year''.

SEC. 210. APPLICATION OF MEDICAID OUTREACH PROCEDURES TO ALL PREGNANT 
              WOMEN AND CHILDREN.

    (a) In General.--Section 1902(a)(55) of the Social Security Act (42 
U.S.C. 1396a(a)(55)) is amended by striking ``individuals for medical 
assistance under subsection (a)(10)(A)(i)(IV), (a)(10)(A)(i)(VI), 
(a)(10)(A)(i)(VII), or (a)(10)(A)(ii)(IX)'' and inserting ``child and 
pregnant women for medical assistance (including under clauses (i)(IV), 
(i)(VI), (i)(VII), and (ii)(IX) of paragraph (10)(A))''.
    (b) Effective Date.--
            (1) In general.--
            (2) Exception for state legislation.--In the case of a 
        State plan under title XIX of the Social Security Act, which 
        the Secretary of Health and Human Services determines requires 
        State legislation in order for the plan to meet the additional 
        requirements imposed by the amendment made by subsection (a), 
        the State plan shall not be regarded as failing to comply with 
        the requirements of such Act solely on the basis of its failure 
        to meet these additional requirements before the first day of 
        the first calendar quarter beginning after the close of the 
        first regular session of the State legislature that begins 
        after the date of enactment of this Act. For purposes of the 
        previous sentence, in the case of a State that has a 2-year 
        legislative session, each year of the session shall be 
        considered to be a separate regular session of the State 
        legislature.

SEC. 211. NO IMPACT ON SECTION 1115 WAIVERS.

    Nothing in this Act shall be construed to affect waivers regarding 
State flexibility on eligibility previously approved by the Secretary 
of Health and Human Services under section 1115 of the Social Security 
Act (42 U.S.C. 1315).

SEC. 212. ELIMINATION OF COUNTING MEDICAID CHILD PRESUMPTIVE 
              ELIGIBILITY COSTS AGAINST TITLE XXI ALLOTMENT.

    Section 2105(a)(1) of the Social Security Act (42 U.S.C. 
1397ee(a)(1)) is amended--
            (1) in the matter preceding subparagraph (A), by striking 
        ``(or, in the case of expenditures described in subparagraph 
        (B), the Federal medical assistance percentage (as defined in 
        the first sentence of section 1905(b)))''; and
            (2) by amending subparagraph (B) to read as follows:
                    ``(B) [reserved]''.

SEC. 213. PROHIBITING LIMITATIONS ON ENROLLMENT.

    (a) In General.--Section 2102(b)(3)(B) of the Social Security Act 
(42 U.S.C. 1397bb(b)(3)(B)) is amended--
            (1) by striking ``and'' at the end of clause (i);
            (2) by striking the period at the end of clause (ii) and 
        inserting ``; and''; and
            (3) by adding at the end the following new clause:
                            ``(iii) shall not impose, with respect to 
                        enrollment of targeted low-income children 
                        under the State child health plan, any 
                        enrollment cap or other numerical limitation on 
                        enrollment, any waiting list, any procedures 
                        designed to delay the consideration of 
                        applications for enrollment, or similar 
                        limitation with respect to enrollment.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to State child health plans as of October 1, 2007.

                 TITLE III--HEALTHY SAVINGS TAX CREDIT

SEC. 301. HEALTHY SAVINGS TAX CREDIT.

    (a) In General.--Subpart C of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to refundable personal 
credits) is amended by redesignating section 36 as section 37 and by 
inserting after section 35 the following new section:

``SEC. 36. HEALTH INSURANCE FOR QUALIFYING CHILDREN.

    ``(a) In General.--In the case of an individual, there shall be 
allowed as a credit against the tax imposed by subtitle A an amount 
equal to the applicable percentage of the amount paid by the taxpayer 
for coverage of qualifying children of the taxpayer under qualified 
health insurance for eligible coverage months beginning in the taxable 
year.
    ``(b) Eligible Coverage Month.--For purposes of this section, the 
term `eligible coverage month' means, with respect to any qualifying 
child of the taxpayer, any month with respect to which the designated 
State agency has certified that, as of the first day of such month, 
such child--
            ``(1) is covered by qualified health insurance,
            ``(2) does not have access to other specified coverage for 
        such month (as determined under subsection (f)), and
            ``(3) is not imprisoned under Federal, State, or local 
        authority.
    ``(c) Applicable Percentage.--
            ``(1) In general.--For purposes of this section, the term 
        `applicable percentage' means the percentage determined in 
        accordance with the following table:


 
 In the case of a taxpayer whose adjusted gross income for
                    the taxable year is:                                The applicable percentage is:
 
200 percent of the poverty line or less....................  0 percent
More than 200 percent, but not more than 225 percent, of     75 percent
 the poverty line.
More than 225 percent, but not more than 250 percent, of     65 percent
 the poverty line.
More than 250 percent, but not more than 300 percent, of     55 percent
 the poverty line.
More than 300 percent, but not more than 350 percent, of     50 percent
 the poverty line.
More than 350 percent of the poverty line..................  0 percent.
 

            ``(2) Poverty line.--For purposes of paragraph (1), the 
        term `poverty line' means the income official poverty line (as 
        defined by the Office of Management and Budget, and revised 
        annually in accordance with section 673(2) of the Community 
        Services Block Grant Act (42 U.S.C. 9902(2)) applicable to a 
        family of the size involved.
    ``(d) Qualifying Child.--For purposes of this section, the term 
`qualifying child' means, with respect to any taxpayer, any qualifying 
child of the taxpayer (as defined in section 152(c)).
    ``(e) Qualified Health Insurance.--For purposes of this section--
            ``(1) In general.--The term `qualified health insurance' 
        means, with respect to any qualifying child of the taxpayer--
                    ``(A) coverage under any insurance constituting 
                medical care which is certified by the designated State 
                agency as being--
                            ``(i) provided under a group health plan 
                        (as defined in section 5000(b)(1)), and
                            ``(ii) at least actuarially equivalent in 
                        benefits coverage to the plan described in 
                        paragraph (2), or
                    ``(B) in the case of a qualifying child who is 
                certified by the designated State agency as not 
                eligible for coverage under any insurance described in 
                subparagraph (A), coverage under any of the following 
                plans if such coverage has been certified by the 
                designated State agency as being at least actuarially 
                equivalent in benefits coverage to the plan described 
                in paragraph (2):
                            ``(i) Coverage offered through hmo.--The 
                        health insurance coverage plan that--
                                    ``(I) is offered by a health 
                                maintenance organization (as defined in 
                                section 2791(b)(3) of the Public Health 
                                Service Act), and
                                    ``(II) has the largest insured 
                                commercial, nonmedicaid enrollment of 
                                covered lives of such coverage plans 
                                offered by such a health maintenance 
                                organization in the State.
                            ``(ii) State employee coverage.--The health 
                        insurance plan that is offered to State 
                        employees and has the largest enrollment of 
                        covered lives of any such plan.
                            ``(iii) SCHIP coverage.--Coverage provided 
                        under the State plan approved under the State 
                        children's health insurance program under title 
                        XXI of Social Security Act (without regard to 
                        coverage provided under a waiver of the 
                        requirements of such program).
                            ``(iv) State certified actuarially 
                        equivalent coverage.--A State-based health 
                        insurance program.
            ``(2) FEHBP actuarially equivalent health benefits 
        coverage.--
                    ``(A) In general.--The plan described in and 
                offered under chapter 89 of title 5, United States Code 
                with the highest number of enrollees under such section 
                for the year preceding the year in which the coverage 
                described in paragraph (1) is provided.
                    ``(B) Application of benchmark standard.--Coverage 
                is actuarially equivalent to benefits coverage under 
                the plan described in subparagraph (A) if such coverage 
                covers all items and services offered by the benchmark 
                plan, with out-of-pocket cost-sharing for such items 
                and services that is not greater than under the 
                benchmark plan.
            ``(3) Insurance which covers other individuals.--In the 
        case of any contract for qualified health insurance under which 
        amounts are payable for coverage of any individual other than 
        one or more qualifying children, the amount treated as paid for 
        coverage of qualifying children under such insurance shall be 
        the greater of--
                    ``(A) the amount which would be so treated under 
                rules similar to the rules of section 213(d)(6), or
                    ``(B) 30 percent of the amounts payable for 
                coverage of all individuals covered under the contract 
                under qualified health insurance.
            ``(4) Only one policy taken into account per child.--With 
        respect to any qualifying child for any period, coverage under 
        not more than one contract for qualified health insurance may 
        be taken into account under subsection (a).
            ``(5) Exception.--The term `qualified health insurance' 
        shall not include--
                    ``(A) a flexible spending or similar arrangement, 
                and
                    ``(B) any insurance if substantially all of its 
                coverage is of excepted benefits described in section 
                9832(c).
            ``(6) Other requirements.--The term `qualified health 
        insurance'shall not include any insurance unless such insurance 
        meets the following requirements:
                    ``(A) Group health plan requirements.--The health 
                benefits coverage provided meets the requirements 
                applicable to a group health plan under chapter 100 of 
                this title, part 7 of subtitle B of title I of the 
                Employee Retirement Income Security Act of 1974, and 
                State law.
                    ``(B) Guaranteed issue and renewable.--The 
                arrangement does not deny coverage (including renewal 
                of coverage) with respect to any qualifying child on 
                the basis of health status of such qualifying child or 
                any other factor, condition or requirement.
                    ``(C) No preexisting condition exclusion.--The 
                arrangement does not permit a preexisting condition 
                exclusion as defined under section 9801(b)(1).
                    ``(D) No underwriting; community-rated premiums.--
                            ``(i) Underwriting.--Subject to 
                        subparagraph (B), the arrangement does not 
                        permit underwriting, through a preexisting 
                        condition limitation, differential benefits, or 
                        different premium levels, or otherwise, with 
                        respect to such coverage for any qualifying 
                        child.
                            ``(ii) Community-rated premiums.--The 
                        premiums charged for such coverage are 
                        community-rated for individuals without regard 
                        to health status.
                    ``(E) No riders.--The arrangement does not permit 
                riders to the health benefits coverage.
    ``(f) Other Specified Coverage.--For purposes of this section, an 
individual has access to other specified coverage for any month if, as 
of the first day of such month--
            ``(1) Medicare, medicaid, and schip.--Such individual--
                    ``(A) is entitle to benefits under part A of title 
                XVIII of the Social Security Act or is enrolled under 
                part B of such title, or
                    ``(B) is eligible to participate in any program 
                under title XIX or XXI of such Act (other than under 
                section 1928 of such Act).
            ``(2) Certain other coverage.--Such individual--
                    ``(A) is enrolled in a health benefits plan under 
                chapter 89 of title 5, United States Code, or
                    ``(B) is entitle to receive benefits under chapter 
                55 of title 10, United States Code.
    ``(g) Designated State Agency.--For purposes of this section, the 
term `designated State agency' means, with respect to any State, the 
agency responsible for administering the State children's health 
insurance program under title XXI of Social Security Act in such State. 
For purposes of carrying out any responsibility under this section, 
such agency may utilize eligibility procedures under title XIX or XXI 
of such Act to the extent not inconsistent with this section.
    ``(h) Special Rules.--
            ``(1) Coordination with advance payment.--With respect to 
        any taxable year, the amount which would (but for this 
        subsection) be allowed as a credit under subsection (a) shall 
        be reduced (but not below zero) by the aggregate amount paid on 
        behalf of such taxpayer under section 7529 for such taxable 
        year.
            ``(2) Coordination with other health insurance credit.--
        Amounts taken into account under subsection (a) shall not be 
        taken into account under section 35(a).
            ``(3) Application of other rules.--Rules similar to the 
        rules of paragraphs (2), (3), (4), (8), and (9) of section 
        35(g) shall apply for purposes of this section.''.
    (b) Advance Payment of Credit.--Chapter 77 of such Code (relating 
to miscellaneous provisions) is amended by adding at the end the 
following new section:

``SEC. 7529. ADVANCE PAYMENT OF CREDIT FOR HEALTH INSURANCE FOR 
              QUALIFYING CHILDREN.

    ``The Secretary shall establish a program for making payments to 
providers of qualified health insurance (as defined in section 36) on 
behalf of taxpayers eligible for the credit under section 36. Except as 
otherwise provided by the Secretary, such payments shall be made on the 
basis of the adjusted gross income of the taxpayer for the preceding 
taxable year.''.
    (c) Disclosure of Return Information for Purposes of Advance 
Payment of Credit as Premiums for Health Insurance for Qualifying 
Children.--
            (1) In general.--Subsection (l) of section 6103 of such 
        Code is amended by adding at the end the following new 
        paragraph:
            ``(21) Disclosure of return information for purposes of 
        advance payment of credit as premiums for health insurance for 
        qualifying children.--The Secretary may, on behalf of taxpayers 
        eligible for the credit under section 36, disclose to a 
        provider of qualified health insurance (as defined in such 
        section), and persons acting on behalf of such provider, return 
        information with respect to any such taxpayer only to the 
        extent necessary (as prescribed by regulations issued by the 
        Secretary) to carry out the program established by section 7529 
        (relating to advance payment of credit as premium payment for 
        health insurance for qualifying children).''.
            (2) Confidentiality of information.--Paragraph (3) of 
        section 6103(a) of such Code is amended by striking ``or (20)'' 
        and inserting ``(20), or (21)''.
            (3) Unauthorized disclosure.--Paragraph (2) of section 
        7213(a) of such Code is amended by striking ``or (20)'' and 
        inserting ``(20), or (21)''.
    (d) Information Reporting.--
            (1) In general.--Subpart B of part III of subchapter A of 
        chapter 61 of such Code (relating to information concerning 
        transactions with other persons) is amended by adding at the 
        end the following new section:

``SEC. 6050W. RETURNS RELATING TO CREDIT FOR HEALTH INSURANCE FOR 
              QUALIFYING CHILDREN.

    ``(a) Requirement of Reporting.--Every person who is entitled to 
receive payments for any month of any calendar year under section 7529 
(relating to advance payment of credit as premium payment for qualified 
health insurance) with respect to any individual shall, at such time as 
the Secretary may prescribe, make the return described in subsection 
(b) with respect to each such individual.
    ``(b) Form and Manner of Returns.--A return is described in this 
subsection if such return--
            ``(1) is in such form as the Secretary may prescribe, and
            ``(2) contains--
                    ``(A) the name, address, and TIN of each individual 
                referred to in subsection (a),
                    ``(B) the number of months for which amounts were 
                entitled to be received with respect to such individual 
                under section 7529 (relating to advance payment of 
                credit as premium payment for health insurance for 
                qualifying children),
                    ``(C) the amount entitled to be received for each 
                such month, and
                    ``(D) such other information as the Secretary may 
                prescribe.
    ``(c) Statements To Be Furnished to Individuals With Respect to 
Whom Information Is Required.--Every person required to make a return 
under subsection (a) shall furnish to each individual whose name is 
required to be set forth in such return a written statement showing--
            ``(1) the name and address of the person required to make 
        such return and the phone number of the information contact for 
        such person, and
            ``(2) the information required to be shown on the return 
        with respect to such individual.
The written statement required under the preceding sentence shall be 
furnished on or before January 31 of the year following the calendar 
year for which the return under subsection (a) is required to be 
made.''.
            (2) Assessable penalties.--
                    (A) Subparagraph (B) of section 6724(d)(1) of such 
                Code (relating to definitions) is amended by striking 
                ``or'' at the end of clause (xix), by striking ``and'' 
                at the end of clause (xx) and inserting ``or'', and by 
                inserting after clause (xx) the following new clause:
                            ``(xxi) section 6050W (relating to returns 
                        relating to credit for health insurance for 
                        qualifying children), and''.
                    (B) Paragraph (2) of section 6724(d) of such Code 
                is amended by striking ``or'' at the end of 
                subparagraph (BB), by striking the period at the end of 
                subparagraph (CC) and inserting ``, or'', and by adding 
                after subparagraph (CC) the following new subparagraph:
                    ``(DD) section 6050W (relating to returns relating 
                to credit for health insurance for qualifying 
                children).''.
    (e) Conforming Amendments.--
            (1) Paragraph (2) of section 1324(b) of title 31, United 
        States Code, is amended by inserting ``or 36'' after ``section 
        35''.
            (2) The table of sections for subpart C of part IV of 
        subchapter A of chapter 1 of the Internal Revenue Code of 1986 
        is amended by redesignating the item relating to section 36 as 
        an item relating to section 37 and by inserting after the item 
        relating to section 35 the following new item:

``Sec. 36. Health insurance for qualifying children.''.
            (3) The table of sections for subpart B of part III of 
        subchapter A of chapter 61 of such Code is amended by adding at 
        the end the following new item:

``Sec. 6050W. Returns relating to credit for health insurance for 
                            qualifying children.''.
            (4) The table of sections for chapter 77 of such Code is 
        amended by adding at the end the following new item:

``Sec. 7529. Advance payment of credit for health insurance of 
                            qualifying children.''.
    (f) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2008.
    (g) Reimbursement for Administrative Costs Incurred in Determining 
Eligibility for Credit.--
            (1) In general.--The Secretary of Health and Human Services 
        shall reimburse States for all reasonable administrative costs 
        incurred in making eligibility determinations in accordance 
        with section 36 of the Internal Revenue Code of 1986 (as added 
        by subsection (a)). Such reimbursement shall not apply to State 
        costs incurred under the State children's health insurance 
        programs or Medicaid.
            (2) Appropriation.--Out of any money in the Treasury of the 
        United States not otherwise appropriated, there are 
        appropriated such sums as may be necessary to carry out this 
        subsection.

     TITLE IV--BROKER REPORTING OF CUSTOMER'S BASIS IN SECURITIES 
                              TRANSACTIONS

SEC. 401. BROKER REPORTING OF CUSTOMER'S BASIS IN SECURITIES 
              TRANSACTIONS.

    (a) In General.--Section 6045 of the Internal Revenue Code of 1986 
(relating to returns of brokers) is amended by adding at the end the 
following new subsection:
    ``(g) Additional Information Required in the Case of Securities 
Transactions.--
            ``(1) In general.--If a broker is otherwise required to 
        make a return under subsection (a) with respect to any 
        applicable security, the broker shall include in such return 
        the information described in paragraph (2).
            ``(2) Additional information required.--
                    ``(A) In general.--The information required under 
                paragraph (1) to be shown on a return with respect to 
                an applicable security of a customer shall include for 
                each reported applicable security the customer's 
                adjusted basis in such security.
                    ``(B) Exemption from requirement.--The Secretary 
                shall issue such regulations or guidance as necessary 
                concerning the application of the requirement under 
                subparagraph (A) in cases in which a broker in making a 
                return does not have sufficient information to meet 
                such requirement with respect to the reported 
                applicable security. Such regulations or guidance may--
                            ``(i) require such other information 
                        related to such adjusted basis as the Secretary 
                        may prescribe, and
                            ``(ii) exempt classes of cases in which the 
                        broker does not have sufficient information to 
                        meet either the requirement under subparagraph 
                        (A) or the requirement under clause (i).
            ``(3) Information transfers.--To the extent provided in 
        regulations, there shall be such exchanges of information 
        between brokers as such regulations may require for purposes of 
        enabling such brokers to meet the requirements of this 
        subsection.
            ``(4) Definitions.--For purposes of this subsection, the 
        term `applicable security' means any--
                    ``(A) security described in subparagraph (A) or (C) 
                of section 475(c)(2),
                    ``(B) interest in a regulated investment company 
                (as defined in section 851), or
                    ``(C) other financial instrument designated in 
                regulations prescribed by the Secretary.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to returns the due date for which (determined without regard to 
extensions) is after December 31, 2009, with respect to securities 
acquired after December 31, 2008.
                                 <all>