[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 1224 Introduced in Senate (IS)]







110th CONGRESS
  1st Session
                                S. 1224

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


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 25, 2007

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

_______________________________________________________________________

                                 A BILL


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

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

SECTION 1. SHORT TITLE; AMENDMENTS TO SOCIAL SECURITY ACT; TABLE OF 
              CONTENTS.

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

Sec. 1. Short title; amendments to Social Security Act; table of 
                            contents.
Sec. 2. Findings.
     TITLE I--MAKING CHILDREN'S HEALTH COVERAGE A NATIONAL PRIORITY

Sec. 101. Providing necessary funding for CHIP.
                   TITLE II--IMPROVING CHIP FINANCING

Sec. 201. State CHIP allotments that are responsive to health care 
                            costs, population growth, and the needs of 
                            low-income uninsured children.
Sec. 202. 2-year initial availability of CHIP allotments for all States 
                            and territories.
Sec. 203. Establishment of timely and responsive redistribution 
                            process.
Sec. 204. Improving funding for the territories under CHIP and 
                            Medicaid.
Sec. 205. Extension of authority for qualifying States to use CHIP 
                            allotments for certain Medicaid 
                            expenditures.
Sec. 206. State option to expand coverage of children under CHIP up to 
                            300 percent of the poverty line.
Sec. 207. Requiring responsible CHIP enrollment growth.
 TITLE III--ENROLLING UNINSURED CHILDREN ELIGIBLE FOR CHIP AND MEDICAID

Sec. 301. ``Express Lane'' option for States to determine components of 
                            a child's eligibility for Medicaid or CHIP.
Sec. 302. Information technology connections to simplify health 
                            coverage determinations.
Sec. 303. Enhanced administrative funding for translation or 
                            interpretation services.
Sec. 304. Enhanced assistance with coverage costs for States with 
                            increasing or high coverage rates among 
                            children.
Sec. 305. Elimination of counting Medicaid child presumptive 
                            eligibility costs against title XXI 
                            allotment.
Sec. 306. State option to require certain individuals to present 
                            satisfactory documentary evidence of proof 
                            of citizenship or nationality for purposes 
                            of eligibility for Medicaid.
                 TITLE IV--START HEALTHY, STAY HEALTHY

Sec. 401. State option to expand or add coverage of certain pregnant 
                            women under Medicaid and CHIP.
Sec. 402. Coordination with the maternal and child health program.
Sec. 403. Optional coverage of legal immigrants under Medicaid and 
                            CHIP.
Sec. 404. Improving benchmark coverage options.
Sec. 405. Requiring coverage of dental and mental health services.
Sec. 406. Clarification of requirement to provide EPSDT services for 
                            all children in benchmark benefit packages 
                            under Medicaid.
Sec. 407. Childhood obesity demonstration project.
         TITLE V--IMPROVING ACCESS TO HEALTH CARE FOR CHILDREN

Sec. 501. Promoting children's access to covered health services.
Sec. 502. Institute of Medicine study and report on children's access 
                            to health care.
TITLE VI--STRENGTHENING QUALITY OF CARE AND HEALTH OUTCOMES OF CHILDREN

Sec. 601. Strengthening child health quality improvement activities.
Sec. 602. Application of certain managed care quality safeguards to 
                            CHIP.
                     TITLE VII--OTHER IMPROVEMENTS

Sec. 701. Strengthening premium assistance programs.
Sec. 702. Permitting coverage of children of State employees.
Sec. 703. Improving data collection.
Sec. 704. Moratorium on application of PERM requirements related to 
                            eligibility reviews during period of 
                            independent study and report.
Sec. 705. Elimination of confusing program references.
                       TITLE VIII--EFFECTIVE DATE

Sec. 801. Effective date.

SEC. 2. FINDINGS.

    Congress makes the following findings:
            (1) The state children's health insurance program (chip) 
        and medicaid have greatly improved children's coverage rates 
        and access to needed health care services.--
                    (A) CHIP and Medicaid serve as the critical health 
                care safety net for 34,000,000 children over the course 
                of a year, with 28,000,000 children enrolled in 
                Medicaid and more than 6,000,000 children enrolled in 
                CHIP.
                    (B) CHIP and Medicaid have accounted for a \1/3\ 
                decline in the rate of uninsured low-income children 
                since 1997.
                    (C) During the recent economic downturn, and as the 
                number of uninsured people has climbed to the highest 
                number ever recorded in the United States, CHIP and 
                Medicaid offset losses in employer-sponsored coverage 
                that affected children and parents alike.
                    (D) While the number of children living in low-
                income families increased between 2000 and 2005, the 
                number of uninsured children fell due to Medicaid and 
                CHIP.
                    (E) Children enrolled in CHIP or Medicaid are much 
                more likely to have a usual source of care than 
                uninsured children, and are much more likely than 
                uninsured children to receive well-child care, see a 
                doctor during the year, and get dental care. Studies 
                have found that children enrolled in public insurance 
                programs experienced significant improvement in 
                measures of school performance.
                    (F) Since CHIP was created, coverage rates have 
                increased significantly among children of all ethnic 
                and racial groups.
                    (G) According to one Federal evaluation of CHIP, 
                uninsured children who gained coverage through the 
                program received more preventive care, and their 
                parents reported better access to providers and 
                improved communications with their children's doctors.
            (2) Even with the success of chip and medicaid, more needs 
        to be done to improve the health status of our nation's 
        children.--
                    (A) There are currently 9,000,000 uninsured 
                children under age 19, accounting for nearly 20 percent 
                of our Nation's uninsured.
                    (B) Approximately 7 out of every 10 uninsured 
                children are eligible for CHIP or Medicaid.
                    (C) The cost of unmet health needs among children 
                extends beyond measurable health system costs. For 
                example, problems that could be prevented, managed, or 
                treated with regular access to care can become more 
                serious, resulting in lower school attendance and 
                increased health care costs.
                    (D) Reducing the number of uninsured children in 
                our country is an essential first step to improve 
                health status. CHIP reauthorization presents an 
                opportunity to secure health care coverage for more 
                children who are eligible for CHIP or Medicaid but not 
                yet enrolled.
            (3) We must maintain coverage for the children currently 
        enrolled in chip.--
                    (A) When CHIP was created in 1997, Congress 
                allocated $40,000,000,000 for the 10-year 
                authorization.
                    (B) At current funding levels, nearly 2,000,000 
                children are at risk of losing their CHIP coverage over 
                the next 5 years because the current CHIP financing 
                structure is inadequate and States are facing CHIP 
                funding shortfalls.
                    (C) We must eliminate Federal funding shortfalls by 
                providing States with significant new Federal resources 
                for children's health coverage.
                    (D) CHIP reauthorization offers an opportunity to 
                increase CHIP funding and to provide stable, 
                predictable Federal funding so that States not only 
                have the ability to maintain their current caseloads 
                but also to expand coverage to currently unenrolled 
                children.
            (4) We must reach the uninsured children who are already 
        eligible for chip or medicaid but unenrolled.--
                    (A) More than 6,000,000 uninsured children are 
                eligible for CHIP or Medicaid at any point during the 
                year.
                    (B) In some States, it is estimated that up to 50 
                percent of children covered through CHIP do not remain 
                in the program due to reenrollment barriers.
                    (C) Difficult renewal policies and reenrollment 
                barriers make seamless coverage in CHIP unattainable. 
                Studies indicate that as many as 67 percent of children 
                who were eligible but not enrolled in CHIP or Medicaid 
                had applied for coverage but were denied eligibility 
                due to procedural issues.
                    (D) States have tools at their disposal to 
                streamline enrollment procedures, but further Federal 
                changes would help States reach more children.
                    (E) Insuring parents is an effective way to 
                increase children's participation in public programs 
                and to increase children's access to health care 
                services.
                    (F) To reduce the number of uninsured children, 
                improve our children's health, and continue our 
                progress in reducing health disparities, the 
                reauthorization of CHIP should provide States with the 
                tools and resources necessary to identify, enroll, and 
                maintain coverage for children who are eligible for 
                CHIP or Medicaid.
            (5) We must support and encourage states that are leading 
        the way with initiatives to cover more children.--
                    (A) States in every region of the country are 
                seeking to move forward in covering more children, 
                either by reaching already eligible children or further 
                expanding eligibility.
                    (B) The Federal government should serve as a 
                partner in these efforts by providing sufficient 
                funding to solidify and strengthen this momentum.
            (6) We must promote high-quality health care that promotes 
        children's healthy development.--
                    (A) Children and adolescents deserve better quality 
                care than what they currently receive.
                    (B) Most States report using some kind of measure 
                to evaluate and improve the quality of care children 
                receive through their CHIP and Medicaid programs. 
                However, State efforts are often hampered by budget 
                constraints, limitations on information technology 
                systems, and a need for improved measurement tools and 
                performance measurement standards.
                    (C) As we improve access to health coverage as part 
                of CHIP reauthorization, Congress also has an 
                opportunity to enhance quality by improving and 
                standardizing data collection efforts.
            (7) We must support policies that strengthen and expand 
        health insurance coverage.--
                    (A) There are more than 46,000,000 uninsured 
                Americans today.
                    (B) No one who is currently covered should lose 
                coverage because of changes to CHIP or Medicaid as part 
                of the reauthorization of CHIP.
                    (C) Coverage of parents through family coverage 
                waivers furthers the objectives of CHIP in that it 
                promotes children's enrollment, positively impacts 
                children's utilization of services, and improves family 
                well-being.
                    (D) Coverage of parents through family coverage 
                waivers is also consistent with long-standing CHIP 
                policy--the explicit authorization in the CHIP statute 
                for the Secretary to grant waivers that are consistent 
                with the objectives of CHIP, the parent waiver 
                guidelines for CHIP issued by the Secretary, and the 
                flexibility broadly accorded states through CHIP.
                    (E) Parent coverage waivers have been granted to 
                States that have made a commitment to cover children 
                first and then to use funding to cover low-income 
                parents.
                    (F) Research indicates that having an uninsured 
                parent not only decreases the likelihood that a child 
                will have a well-child visit, it also decreases the 
                likelihood that a child will see any medical provider 
                at all.
                    (G) We strongly support maintaining the current 
                flexibility under CHIP that permits family coverage 
                through waivers to cover parents, while assuring that 
                children remain the primary focus of CHIP.

     TITLE I--MAKING CHILDREN'S HEALTH COVERAGE A NATIONAL PRIORITY

SEC. 101. PROVIDING NECESSARY FUNDING FOR CHIP.

    Section 2104(a) (42 U.S.C. 1397dd(a)) is amended--
            (1) in paragraph (9), by striking ``and'' at the end;
            (2) in paragraph (10), by striking the period at the end 
        and inserting a semicolon; and
            (3) by adding at the end the following new paragraphs:
            ``(11) for fiscal year 2008, $8,525,000,000;
            ``(12) for fiscal year 2009, $10,075,000,000;
            ``(13) for fiscal year 2010, $11,250,000,000;
            ``(14) for fiscal year 2011, $13,150,000,000;
            ``(15) for fiscal year 2012, $15,400,000,000; and
            ``(16) for fiscal year 2013 and each fiscal year 
        thereafter, the total allotment amount appropriated under this 
        subsection for the preceding fiscal year, multiplied by the 
        adjustment determined for such fiscal year under subsection 
        (i)(2)(C).''.

                   TITLE II--IMPROVING CHIP FINANCING

SEC. 201. STATE CHIP ALLOTMENTS THAT ARE RESPONSIVE TO HEALTH CARE 
              COSTS, POPULATION GROWTH, AND THE NEEDS OF LOW-INCOME 
              UNINSURED CHILDREN.

    (a) In General.--Section 2104 (42 U.S.C. 1397dd) is amended by 
adding at the end the following new subsection:
    ``(i) Annual Allotments for States Other Than Territories Beginning 
With Fiscal Year 2008.--
            ``(1) In general.--Subject to paragraph (4), of the total 
        allotment amount appropriated under subsection (a) for a fiscal 
        year beginning with fiscal year 2008 and remaining available 
        after the application of subsection (j) and subsection (c)(5), 
        the Secretary shall allot to each State (as defined for 
        purposes of this subsection in paragraph (5)) the sum of the 
        following:
                    ``(A) The coverage factor, as determined under 
                paragraph (2), based on the State's prior spending 
                adjusted for health care cost growth and child 
                population growth.
                    ``(B) The uninsured children factor, as determined 
                under paragraph (3), based on the number of low-income 
                children without health insurance in the State, 
                adjusted for geographic variation in health care costs.
            ``(2) Coverage factor.--
                    ``(A) In general.--For purposes of paragraph 
                (1)(A), subject to subparagraphs (B) and (D), the 
                coverage factor determined for a State is equal to the 
                following:
                            ``(i) Fiscal year 2008.--For fiscal year 
                        2008, the higher of the following:
                                    ``(I) The total Federal payments to 
                                the State under this title for fiscal 
                                year 2007 multiplied by the annual 
                                adjustment determined under 
                                subparagraph (C) for that fiscal year.
                                    ``(II) The amount allotted to the 
                                State for fiscal year 2007 under 
                                subsection (b), multiplied by the 
                                annual adjustment determined under 
                                subparagraph (C) for that fiscal year.
                                    ``(III) The projected total Federal 
                                payments to the State under this title 
                                for fiscal year 2007, as reported by 
                                the State to the Secretary by the State 
                                as of November 2006 (or the projected 
                                total Federal payments to the State 
                                under this title for fiscal year 2007 
                                as reported by the State to the 
                                Secretary as of May 2006 if the 
                                projected total Federal payments to the 
                                State under this title for such fiscal 
                                year were at least $95,000,000 higher 
                                than such projected payments as of 
                                November 2006), multiplied by the 
                                annual adjustment determined under 
                                subparagraph (C) for that fiscal year.
                                    ``(IV) The projected total Federal 
                                payments to the State under this title 
                                for fiscal year 2008, as reported by 
                                the State to the Secretary by the State 
                                as of February 2007.
                            ``(ii) Fiscal year 2009.--For fiscal year 
                        2009, the amount determined under clause (i), 
                        multiplied by the annual adjustment determined 
                        under subparagraph (C) for that fiscal year.
                            ``(iii) Fiscal year 2010 and each second 
                        succeeding fiscal year; providing for 
                        rebasing.--Subject to subparagraphs (B) and 
                        (D), for fiscal year 2010 and each second 
                        succeeding fiscal year, the total Federal 
                        payments to the State under this title for the 
                        previous fiscal year attributable to any 
                        allotments available to the State in such 
                        fiscal year under paragraph (1) and subsection 
                        (b) multiplied by the annual adjustment 
                        determined under subparagraph (C) for that 
                        fiscal year.
                            ``(iv) Fiscal year 2011 and each second 
                        succeeding fiscal year.--For fiscal year 2011 
                        and each second succeeding fiscal year, the 
                        amount determined under clause (iii) for the 
                        preceding fiscal year, multiplied by the annual 
                        adjustment determined under subparagraph (C) 
                        for the State for that fiscal year.
                    ``(B) Limitation and minimums.--
                            ``(i) In general.--Subject to clause (ii), 
                        if the total of the coverage factors determined 
                        under subparagraph (A) for all States exceed in 
                        any fiscal year the total allotment amount 
                        under subsection (a) for a fiscal year 
                        beginning with fiscal year 2008 remaining 
                        available after the application of subsections 
                        (c)(5) and (j)(2)(C), each State's coverage 
                        factor shall be equal to the total allotment 
                        amount under subsection (a) for a fiscal year 
                        remaining available after application of such 
                        subsections, multiplied by the ratio of--
                                    ``(I) the amount of the State's 
                                coverage factor determined under 
                                subparagraph (A); to
                                    ``(II) the total of such coverage 
                                factors for all States for such fiscal 
                                year.
                            ``(ii) Mimimum coverage factor.--At a 
                        minimum, the coverage factor for a State for a 
                        fiscal year shall not be less than the lesser 
                        of--
                                    ``(I) the State's total Federal 
                                payments attributable to any allotments 
                                available to the State in the prior 
                                fiscal year under paragraph (1) and 
                                subsection (b), multiplied by the 
                                annual adjustment determined under 
                                subparagraph (C) for that fiscal year; 
                                and
                                    ``(II) the total allotment for the 
                                State under paragraph (1) for the prior 
                                fiscal year, multiplied by the annual 
                                adjustment determined under 
                                subparagraph (C) for that fiscal year.
                    ``(C) Annual adjustment for health care cost growth 
                and child population growth.--The annual adjustment 
                with respect to a State for any fiscal year is equal to 
                the product of the amounts determined under clauses (i) 
                and (ii):
                            ``(i) Per capita health care growth.--1 
                        plus the percentage increase (if any) in the 
                        projected nominal per capita amount of National 
                        Health Expenditures for such fiscal year over 
                        the preceding fiscal year, as most recently 
                        published by the Secretary before the beginning 
                        of the fiscal year involved.
                            ``(ii) Child population growth.--1.01 plus 
                        the percentage increase in the population of 
                        children under 19 years of age in the United 
                        States from July 1 of the previous fiscal year 
                        to July 1 of the fiscal year involved, as 
                        determined by the Secretary based on the most 
                        recent published estimates of the Bureau of the 
                        Census before the beginning of the fiscal year 
                        involved.
                    ``(D) Rebasing rule for fiscal year 2010 and each 
                second succeeding fiscal year for certain states.--
                            ``(i) In general.--For fiscal year 2010 and 
                        each second succeeding fiscal year, a State 
                        receiving reallocated funds under subsection 
                        (j) in the prior fiscal year shall receive an 
                        additional spending amount equal to the 
                        proportion (determined under clause (ii)) of 
                        the total allotment amount under subsection (a) 
                        for such fiscal year remaining available after 
                        the application of subsections (c)(5) and 
                        (j)(2)(C), and subparagraphs (A) and (B), if 
                        any, multiplied by the ratio of--
                                    ``(I) the total Federal payments to 
                                the State under this title for the 
                                previous fiscal year attributable to 
                                any funds made available to the State 
                                in the previous fiscal year under 
                                subsection (j), multiplied by the 
                                annual adjustment determined under 
                                subparagraph (C) for the fiscal year; 
                                to
                                    ``(II) the total of such payments 
                                for all States for the previous fiscal 
                                year.
                            ``(ii) Proportion.--For purposes of clause 
                        (i), the proportion shall equal--
                                    ``(I) for fiscal year 2010, 20 
                                percent; and
                                    ``(II) for fiscal year 2012 and 
                                each second succeeding fiscal year, 40 
                                percent.
            ``(3) Uninsured children factor.--
                    ``(A) In general.--For purposes of paragraph 
                (1)(B), subject to subparagraph (B), the uninsured 
                children factor for a State is equal to the total 
                allotment amount under subsection (a) for a fiscal year 
                beginning with fiscal year 2008, remaining available 
                after application of subsections (c)(5) and (j)(2)(C) 
                and paragraph (2), multiplied by the following:
                            ``(i) Fiscal year 2008 and each second 
                        succeeding fiscal year.--In the case of fiscal 
                        year 2008, and each second succeeding fiscal 
                        year, the ratio of--
                                    ``(I) the uninsured children 
                                adjustment for the State determined 
                                under subparagraph (B); to
                                    ``(II) the sum of the uninsured 
                                children adjustments for all States 
                                determined under subparagraph (B).
                            ``(ii) Fiscal year 2009 and each second 
                        succeeding fiscal year.--In the case of fiscal 
                        year 2009, and each second succeeding fiscal 
                        year, the ratio determined under clause (i) for 
                        the previous fiscal year.
                    ``(B) Uninsured children adjustment.--The uninsured 
                children adjustment determined under this subparagraph 
                for a State is equal to the product of the following:
                            ``(i) Number of low-income children without 
                        health insurance.--The average of the number of 
                        low-income children under 19 years of age in 
                        the State with no health insurance for a fiscal 
                        year, as reported and defined in the 2 most 
                        recent March supplement to the Current 
                        Population Survey of the Bureau of the Census 
                        available prior to the beginning of such fiscal 
                        year.
                            ``(ii) Geographic variation in health care 
                        costs.--The adjustment for geographic variation 
                        in health care costs, as determined under 
                        subsection (b)(3).
            ``(4) Data.--In computing the amounts under paragraphs (2) 
        and (3) and subsection (c)(5) that determine the allotments to 
        States for each fiscal year, the Secretary shall use the most 
        recent expenditure data for the prior year available to the 
        Secretary before the start of each fiscal year. The Secretary 
        may adjust such amounts and allotments, as necessary, on the 
        basis of the expenditure data for the prior year reported by 
        States on CMS Form 64 or CMS Form 21 not later than November 30 
        of each fiscal year but in no case shall the Secretary adjust 
        the allotments provided under this subsection or subsection 
        (c)(5) for a fiscal year after December 31 of such year.
            ``(5) State defined.--In this subsection, the term `State' 
        means one of the 50 States or the District of Columbia.''.
    (b) Conforming Amendments.--Section 2104 (42 U.S.C. 1397dd) is 
amended--
            (1) in subsection (a), by striking ``subsection (d)'' and 
        inserting ``subsections (d), (h), and (i)'';
            (2) in subsection (b)--
                    (A) in paragraph (1), by striking ``subsection 
                (d)'' and inserting ``subsections (d), (h), and (i)''; 
                and
                    (B) in paragraph (3)(A), by inserting ``and 
                subsection (i)(3)(D)(ii)'' after ``paragraph 
                (1)(A)(ii)''; and
            (3) in subsection (c)(1), by striking ``subsection (d)'' 
        and inserting ``subsections (d), (h), and (i)''.

SEC. 202. 2-YEAR INITIAL AVAILABILITY OF CHIP ALLOTMENTS FOR ALL STATES 
              AND TERRITORIES.

    Section 2104(e) (42 U.S.C. 1397dd(e)) is amended to read as 
follows:
    ``(e) Availability of Amounts Allotted.--Subject to paragraphs (3) 
and (4) of subsection (j), amounts allotted to a State pursuant to 
subsections (b), (c), or (i)--
            ``(1) 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
            ``(2) for fiscal year 2008 and each fiscal year thereafter, 
        shall remain available for expenditure by the State through the 
        end of the succeeding fiscal year.''.

SEC. 203. ESTABLISHMENT OF TIMELY AND RESPONSIVE REDISTRIBUTION 
              PROCESS.

    (a) In General.--Section 2104 (42 U.S.C. 1397dd), as amended by 
section 201, is amended by adding at the end the following new 
subsection:
    ``(j) Timely and Responsive Redistributions Beginning With Fiscal 
Year 2008.--
            ``(1) Reallocation to states facing federal funding 
        shortfalls.--
                    ``(A) In general.--Notwithstanding subsection (f), 
                in each fiscal year quarter of fiscal year 2008 and 
                each subsequent fiscal year, the Secretary shall 
                reallocate to a shortfall State described in 
                subparagraph (D) from the funds available under 
                paragraph (2) an amount equal to the projected amount 
                of the shortfall for the fiscal year. The Secretary 
                shall only make such a reallocation under this 
                paragraph to the extent that there are amounts 
                available under paragraph (2).
                    ``(B) Proration rule.--If the amounts available 
                under paragraph (2) for any fiscal year quarter for 
                reallocation under subparagraph (A) are less than the 
                total shortfall amounts for the fiscal year determined 
                under subparagraph (A), the reallocated amount to each 
                shortfall State shall be reduced proportionally.
                    ``(C) Availability of reallocated funds.--Any funds 
                made available to a shortfall State described in 
                subparagraph (D) shall remain available to such State 
                through the end of the fiscal year in which such funds 
                are reallocated.
                    ``(D) Shortfall state described.--For purposes of 
                subparagraph (A), a shortfall State is a State (as 
                defined in subsection (i)(5)) that has a State child 
                health plan approved under this title (or waiver of 
                such title approved by the Secretary) for which the 
                Secretary estimates on a quarterly basis using the most 
                recent data available to the Secretary as of such 
                quarter, that the projected expenditures under such 
                plan (or waiver) for the State for the fiscal year will 
                exceed the sum of--
                            ``(i) the amount of the allotments provided 
                        under subsection (b) or (i) in fiscal years 
                        preceding such fiscal year that remain 
                        available to the State;
                            ``(ii) the amount of the allotment under 
                        subsection (i) for such fiscal year to the 
                        State; and
                            ``(iii) the amount of any reallocated funds 
                        made available under subparagraph (A) in 
                        previous quarters of such fiscal year to the 
                        State.
            ``(2) Amounts available for reallocation.--Amounts 
        available for reallocation in any fiscal year under this 
        subsection shall equal the sum of the following:
                    ``(A) Any allotments remaining unexpended after the 
                period of availability under subsection (e).
                    ``(B) Any amounts available for reallocation and 
                remaining unexpended at the end of the previous fiscal 
                year under paragraph (3).
                    ``(C) Subject to paragraph (4), 5 percent of the 
                total amount available under subsection (a) for such 
                fiscal year.
            ``(3) Continued availability of unexpended reallocated 
        funds.--Any unexpended amounts reallocated to a shortfall State 
        remaining available after the period of availability under 
        paragraph (1)(C) and any amounts available for redistribution 
        in a fiscal year that are not reallocated to a shortfall State 
        because the total amount available for reallocation exceeds the 
        total of all reallocated amounts under paragraph (1)(A) shall 
        remain available for reallocation until expended.
            ``(4) Limits on withholding from total allotments for 
        purposes of reallocation.--If the Secretary determines that the 
        total amounts available for reallocation under paragraph (2) 
        for a fiscal year exceeds 10 percent of the total amount 
        available under subsection (a) for that fiscal year, the 
        Secretary shall reduce the percentage under paragraph (2)(C) 
        accordingly so that the total amount available for reallocation 
        under paragraph (2) for the fiscal year does not exceed 10 
        percent of the total amount available under subsection (a) for 
        such fiscal year.''.

SEC. 204. IMPROVING FUNDING FOR THE TERRITORIES UNDER CHIP AND 
              MEDICAID.

    (a) Update of CHIP Allotments.--Section 2104(c) (42 U.S.C. 
1397dd(c)) is amended--
            (1) in paragraph (1), by inserting ``and paragraphs (5) and 
        (6)'' after ``subsection (d)''; and
            (2) by adding at the end the following new paragraphs:
            ``(5) Annual allotments for territories beginning with 
        fiscal year 2008.--Of the total allotment amount appropriated 
        under subsection (a) for a fiscal year beginning with fiscal 
        year 2008 and remaining available after the application of 
        subsection (j), the Secretary shall allot to each of the 
        commonwealths and territories described in paragraph (3) the 
        following:
                    ``(A) Fiscal year 2008.--For fiscal year 2008, the 
                highest amount of Federal payments to the commonwealth 
                or territory under this title for any fiscal year 
                occurring during the period of fiscal years 1998 
                through 2007, multiplied by the annual adjustment 
                determined under subsection (i)(2)(C) for the fiscal 
                year.
                    ``(B) Fiscal year 2009 and succeeding fiscal 
                years.--For fiscal year 2009 and each succeeding fiscal 
                year, the amount determined under clause (i), 
                multiplied by the annual adjustment determined under 
                subsection (i)(2)(C) for the fiscal year.
            ``(6) Redistributions for territories facing federal 
        funding shortfalls.--Notwithstanding subsection (f), the 
        Secretary shall determine an appropriate procedure for 
        reallocating to each commonwealth or territory described in 
        paragraph (3) that would, with respect to each fiscal year 
        quarter of fiscal year 2008 be a shortfall State described in 
        subsection (j)(1)(D) if such subsection applied to such 
        commonwealth or territory, from the funds available under 
        subsection (j)(2) for such fiscal year, the same proportion as 
        the proportion of the commonwealth's or territory's allotment 
        under paragraph (2 ) to such percentage (not to exceed 1.05 
        percent) as the Secretary determines appropriate of such 
        funds.''.
    (b) Removal of Federal Matching Payments for Data Reporting Systems 
From the Overall Limit on Payments to Territories Under Title XIX.--
Section 1108(g) (42 U.S.C. 1308(g)) is amended by adding at the end the 
following new paragraph:
            ``(4) Exclusion of certain expenditures from payment 
        limits.--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 subparagraph (A)(i), (A) (iii), (A)(iv), or (B) 
        of section 1903(a)(3) for a calendar quarter of such fiscal 
        year, the limitation on expenditures under title XIX for such 
        commonwealth or territory otherwise determined under subsection 
        (f) and this subsection for such fiscal year shall be 
        determined without regard to such payment.''.
    (c) GAO Study and Report.--Not later than September 30, 2009, the 
Comptroller General of the United States shall submit a report to 
Congress regarding Federal funding under Medicaid and the State 
Children's Health Insurance Program for Puerto Rico, the United States 
Virgin Islands, Guam, American Samoa, and the Northern Mariana Islands. 
The report shall include the following:
            (1) An analysis of all relevant factors with respect to--
                    (A) eligible Medicaid and CHIP populations in such 
                commonwealths and territories;
                    (B) historical and projected spending needs of such 
                commonwealths and territories and the ability of capped 
                funding streams to respond to those spending needs;
                    (C) the extent to which Federal poverty guidelines 
                are used by such commonwealths and territories to 
                determine Medicaid and CHIP eligibility; and
                    (D) the extent to which such commonwealths and 
                territories participate in data collection and 
                reporting related to Medicaid and CHIP, including an 
                analysis of territory participation in the Current 
                Population Survey versus the American Community Survey.
            (2) Recommendations for improving Federal funding under 
        Medicaid and the State Children's Health Insurance Program for 
        such commonwealths and territories.

SEC. 205. EXTENSION OF AUTHORITY FOR QUALIFYING STATES TO USE CHIP 
              ALLOTMENTS FOR CERTAIN MEDICAID EXPENDITURES.

    Section 2105(g)(1)(A) (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 ``not more than 20 percent 
of any allotment under section 2104 for fiscal year 1998, 1999, 2000, 
2001, 2004, 2005, 2006, or 2007'' and inserting ``any allotment under 
subsection (b) or (i) of section 2104 for a fiscal year''.

SEC. 206. STATE OPTION TO EXPAND COVERAGE OF CHILDREN UNDER CHIP UP TO 
              300 PERCENT OF THE POVERTY LINE.

    Section 2110(b)(1)(B) (42 U.S.C. 1397jj(b)(1)(B)) is amended--
            (1) in clause (i), by striking ``, or'' at the end and 
        inserting a semicolon;
            (2) in clause (ii)(III), by striking ``and'' at the end and 
        inserting ``or''; and
            (3) by adding at the end the following new clause:
                    ``(iii) is a child--
                            ``(I) whose family income (as determined 
                        under the State child health plan) does not 
                        exceed 300 percent of the poverty line for a 
                        family of the size involved; or
                            ``(II) whose family income exceeds 300 
                        percent of the poverty line but does not exceed 
                        50 percentage points above the effective income 
                        level (expressed as a percent of the poverty 
                        line and considering applicable income 
                        disregards) applied under the State child 
                        health plan on the date of enactment of this 
                        clause; and''.

SEC. 207. REQUIRING RESPONSIBLE CHIP ENROLLMENT GROWTH.

    (a) Limitation on Approval of Proposed Plan Amendments.--Section 
2106(b)(3)(B) (42 U.S.C. 1397ff(b)(3)(B)) is amended by adding at the 
end the following new clause:
                            ``(iii) Amendments to expand eligibility 
                        beyond highest income eligibility permitted.--
                        Any plan amendment that would allow funds made 
                        available under this title to be used to 
                        provide child health assistance or other health 
                        benefits coverage for a child whose family 
                        income exceeds the highest income eligibility 
                        level permitted under section 
                        2110(b)(1)(B)(iii) (in this clause referred to 
                        as an `expansion amendment') may not take 
                        effect, and shall not remain in effect, unless 
                        the Secretary determines that the following 
                        conditions are met:
                                    ``(I) Uninsured rate for low-income 
                                children is below the national 
                                average.--With respect to each fiscal 
                                year in which the expansion amendment 
                                is in effect, the percentage of low-
                                income children without private health 
                                coverage who are uninsured is below the 
                                national average percentage of such 
                                children, for the most recent year for 
                                which such data is available (as 
                                determined by the Secretary on the 
                                basis of the 2 most recent Annual 
                                Social and Economic Supplements of the 
                                Current Population Survey of the Bureau 
                                of the Census).
                                    ``(II) Open enrollment; maintenance 
                                of eligibility standards.--The State 
                                does not impose any numerical 
                                limitation, waiting list, or similar 
                                limitation on eligibility for targeted 
                                low-income children described in 
                                section 2110(b)(1)(B)(iii) under the 
                                State child health plan, or to make 
                                more restrictive the eligibility 
                                standards for such children, while the 
                                expansion amendment is in effect.
                                    ``(III) Implementation of 
                                simplified outreach and enrollment 
                                procedures.--The State submitting the 
                                expansion amendment has implemented 
                                procedures to effectively enroll and 
                                retain children eligible for medical 
                                assistance under title XIX and children 
                                eligible for child health assistance 
                                under this title by adopting and 
                                effectively implementing with respect 
                                to such children at least 3 of the 
                                following policies and procedures under 
                                title XIX and this title:
                                            ``(aa) Joint application 
                                        and renewal process that 
                                        permits application other than 
                                        in person.--The application and 
                                        renewal forms and supplemental 
                                        forms (if any) and information 
                                        verification process is the 
                                        same for purposes of 
                                        establishing and renewing 
                                        eligibility for children for 
                                        medical assistance under title 
                                        XIX and child health assistance 
                                        under this title, and such 
                                        process does not require an 
                                        application to be made in 
                                        person or a face-to-face 
                                        interview.
                                            ``(bb) No assets test.--The 
                                        State does not apply any assets 
                                        test for eligibility under 
                                        title XIX and this title with 
                                        respect to children.
                                            ``(cc) 12-months continuous 
                                        eligibility.--The State has 
                                        elected the option of 
                                        continuous eligibility for a 
                                        full 12 months for children 
                                        described in section 
                                        1902(e)(12) under title XIX, 
                                        and applies such option under 
                                        this title.
                                            ``(dd) Presumptive 
                                        eligibility for children.--The 
                                        State has implemented the 
                                        option, for purposes of title 
                                        XIX and this title, of applying 
                                        presumptive eligibility for 
                                        children in accordance with 
                                        sections 1920A and 
                                        2107(e)(1)(F).
                                    ``(IV) Annual reporting of measures 
                                of quality of health care for 
                                children.--The State satisfies the 
                                requirements of section 
                                1905(y)(2)(B)(iv) (relating to annual 
                                reporting of measures of quality of 
                                health care for children under title 
                                XIX and this title).''.
    (b) Application to Waivers.--Section 2107(f) (42 U.S.C. 1397gg(f)) 
is amended--
            (1) by striking ``, the Secretary'' and inserting ``:
            ``(1) The Secretary''; and
            (2) by adding at the end the following new paragraph:
            ``(2) The Secretary may not approve a waiver, experimental, 
        pilot, or demonstration project with respect to a State that 
        would allow funds made available under this title to be used to 
        provide child health assistance or other health benefits 
        coverage for a child whose family income exceeds the highest 
        income eligibility level permitted under section 
        2110(b)(1)(B)(iii) (in this paragraph referred to as an 
        `expansion waiver') unless the Secretary determines that the 
        conditions described in each of subclauses (I) through (IV) of 
        section 2106(b)(3)(B)(iii) are met (and determines on an 
        ongoing basis, that such conditions continue to be met while 
        the expansion waiver is in effect).''.

 TITLE III--ENROLLING UNINSURED CHILDREN ELIGIBLE FOR CHIP AND MEDICAID

SEC. 301. ``EXPRESS LANE'' OPTION FOR STATES TO DETERMINE COMPONENTS OF 
              A CHILD'S ELIGIBILITY FOR MEDICAID OR CHIP.

    (a) Medicaid.--Section 1902(e) (42 U.S.C. 1396a(e)) is amended by 
adding at the end the following new paragraph:
    ``(13)(A)(i) At the option of the State, notwithstanding any other 
provision of law, including subsection (a)(46)(B) and sections 1137(d) 
and 1903(x), the State may rely on a determination made within a 
reasonable period (as determined by the State) by an Express Lane 
agency (as defined in subparagraph (F)(i)) to determine whether an 
individual has met the income, assets or resources, or citizenship 
status criteria for eligibility for medical assistance under this title 
(including under a waiver of the requirements of this title).
    ``(ii) The option under clause (i) shall apply to redeterminations 
or renewals of eligibility for medical assistance, as well as to 
initial applications for such assistance.
    ``(iii) The option under clause (i) shall apply to a child who is 
under an age specified by the State (not to exceed 21 years of age) 
and, at State option, may also apply to an individual who is not a 
child.
    ``(B) Nothing in this paragraph shall be construed to relieve a 
State of the obligation to determine eligibility for medical assistance 
under this title if an individual is determined ineligible for such 
assistance on the basis of information furnished pursuant to this 
paragraph.
    ``(C) A State shall inform an individual (or, in the case of a 
child, the family of the child) enrolled in the State plan under this 
title and required to pay premiums for such enrollment based on an 
income determination furnished to the State pursuant to this paragraph 
that the individual or family may qualify for lower premium payments if 
directly evaluated for eligibility by the State Medicaid agency.
    ``(D) If a State applies the eligibility process described in 
subparagraph (A) to individuals eligible for medical assistance under 
this title, 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 program administered by the 
                Express Lane agency and the State plan under this 
                title); and
                    ``(II) provide that, with respect to any individual 
                within such population whom an Express Lane 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, and that if their child is 
        determined to be eligible for such assistance, the child may 
        receive health benefits coverage that is more affordable and 
        comprehensive than the coverage that would be provided to the 
        child under the State child health plan.
            ``(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 an Express Lane 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.
    ``(E)(i) At the option of a State, an individual determined to be 
eligible for medical 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 being enrolled in the State plan under this title. 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) In this paragraph, the term `Express Lane agency' means 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 State child health plan under title XXI, 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 or entity has fiscal liabilities or 
        responsibilities affected by such determination;
            ``(ii) the agency or entity notifies the child's family--
                    ``(I) of the information which shall be disclosed 
                in accordance with this paragraph;
                    ``(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;
                    ``(III) that interagency agreements limit the use 
                of such information to such purposes; and
                    ``(IV) that the family may elect to not have the 
                information disclosed for such purposes; and
            ``(iii) the requirements of section 1939 are satisfied.''.
    (b) CHIP.--Section 2107(e)(1) (42 U.S.C. 1397gg(e)(1)) is amended 
by redesignating subparagraphs (B) through (D) as subparagraphs (C) 
through (E), respectively, and by inserting after subparagraph (A) the 
following new subparagraph:
                    ``(B) Section 1902(e)(13) (relating to the State 
                option to base a determination of a child's eligibility 
                for assistance on determinations made by an agency 
                other than the State Medicaid agency).''.
    (c) Presumptive Eligibility.--Section 1920A(b)(3)(A)(i) (42 U.S.C. 
1396r-1a(b)(3)(A)(i)) is amended by striking ``or (IV)'' and inserting 
``(IV) is an agency or entity described in section 1902(e)(13)(F), or 
(V)''.
    (d) Signature Requirements.--Section 1902(a) (42 U.S.C. 1396a(a)) 
is amended by adding at the end the following new sentence: 
``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 an 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. 302. INFORMATION TECHNOLOGY CONNECTIONS TO SIMPLIFY HEALTH 
              COVERAGE DETERMINATIONS.

    (a) Enhanced Administrative Funding for Information Technology Used 
To Simplify Eligibility Determinations.--Section 1903(a)(3)(A) (42 
U.S.C. 1396b(a)(3)(A)) is amended--
            (1) by striking ``and'' at the end of clause (i); and
            (2) by adding at the end the following new clause:
                    ``(iii) 75 percent of so much of the sums expended 
                during such quarter as are attributable to information 
                technology needed to conduct data matches or for the 
                exchange of electronic information with an Express Lane 
                agency (as defined in 1902(e)(13)(F)) as the Secretary 
                determines is directly related to reducing the need for 
                an individual undergoing an eligibility determination 
                for medical assistance under this title or child health 
                assistance under title XXI (including a determination 
                of a renewal of eligibility for such assistance) to 
                provide information previously submitted by or on 
                behalf of the individual to such agency, and''.
    (b) Authorization of Information Disclosure.--
            (1) In general.--Title XIX (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 
                new section:

            ``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 (including eligibility files maintained by Express 
Lane agencies described in section 1902(e)(13)(F), information 
described in paragraph (2) or (3) of section 1137(a), vital records 
information about births in any State, and information described in 
sections 453(i) and 1902(a)(25)(I)) is authorized to convey such data 
or information to the State agency administering the State plan under 
this title, if--
            ``(1) such data or information are used only to establish 
        or verify eligibility or provide coverage under this title; 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 medical assistance under this 
                title and enrolling such individuals in the State plan; 
                and
                    ``(B) verifying the eligibility of individuals for 
                medical assistance under the State plan.
            ``(3) An interagency or other agreement, consistent with 
        standards developed by the Secretary--
                    ``(A) prevents the unauthorized use, disclosure, or 
                modification of such data and otherwise meets 
                applicable Federal requirements safeguarding privacy 
                and data security; and
                    ``(B) requires the State agency administering the 
                State plan to use the data and information obtained 
                under this section to seek to enroll individuals in the 
                plan.
    ``(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 title xxi.--Section 2107(e)(1) 
        (42 U.S.C. 1397gg(e)(1)), as amended by section 301(b), is 
        amended by adding at the end the following new subparagraph:
                    ``(F) Section 1939 (relating to authorization to 
                receive data potentially pertinent to eligibility 
                determinations).''.
            (3) Conforming amendment to assure access to national new 
        hires database.--Section 453(i)(1) (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''.
            (4) Conforming amendment to provide chip 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''.
            (5) Conforming amendment to provide access to data about 
        enrollment in insurance for purposes of evaluating applications 
        and for chip.--Section 1902(a)(25)(I)(i) (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. 303. ENHANCED ADMINISTRATIVE FUNDING FOR TRANSLATION OR 
              INTERPRETATION SERVICES.

    Section 1903(a)(2) (42 U.S.C. 1396b(a)(2)) is amended by adding at 
the end the following new subparagraph:
            ``(E) an amount equal to 75 percent of so much of the sums 
        expended during such quarter (as found necessary by the 
        Secretary for the proper and efficient administration of the 
        State plan) as are attributable to translation or 
        interpretation services in connection with the enrollment and 
        use of services under this title by individuals for whom 
        English is not their primary language; plus''.

SEC. 304. ENHANCED ASSISTANCE WITH COVERAGE COSTS FOR STATES WITH 
              INCREASING OR HIGH COVERAGE RATES AMONG CHILDREN.

    Section 1905 (42 U.S.C. 1396d) is amended--
            (1) in subsection (b), in the first sentence--
                    (A) by striking ``and (4)'' and inserting ``(4)''; 
                and
                    (B) by inserting ``, and (5) the Federal medical 
                assistance percentage with respect to medical 
                assistance provided to individuals who have not 
                attained age 19 for a fiscal year shall be increased, 
                notwithstanding the previous clauses of this sentence, 
                in the case of a State that meets the conditions 
                described in subparagraph (A) of subsection (y)(1) in 
                the preceding fiscal year by the number of percentage 
                points determined under subparagraph (B) of that 
                subsection, in the case of a State that is described in 
                subparagraph (A) of subsection (y)(2) in the preceding 
                fiscal year, by the number of percentage points 
                determined under subparagraph (D) of that subsection, 
                and, in the case of a State described in both such 
                subparagraphs in the preceding fiscal year, by the 
                greater of the number of percentage points determined 
                under paragraph (1)(B) or (2)(D) of subsection (y)'' 
                before the period; and
            (2) by adding at the end the following new subsection:
    ``(y) Determination of Increase in FMAP for Medical Assistance for 
Children for Certain States.--
            ``(1) For states significantly increasing enrollment of 
        eligible children.--
                    ``(A) Significant increase in enrollment of 
                eligible children.--
                            ``(i) In general.--For purposes of clause 
                        (5) of the first sentence of subsection (b), a 
                        State described in this paragraph is a State 
                        that satisfies the reporting requirements 
                        described in clause (iii) and has a percentage 
                        increase in the child caseload in the reference 
                        year over the initial reference year that 
                        exceeds the benchmark rate of growth.
                            ``(ii) Definitions.--For purposes of clause 
                        (i):
                                    ``(I) Child caseload.--The term 
                                `child caseload' means the average 
                                monthly enrollment of individuals under 
                                age 19 in the State plan under this 
                                title or under a waiver of such title, 
                                as determined by the Secretary.
                                    ``(II) Initial reference year.--The 
                                term `initial reference year' means the 
                                12-month period preceding August 1, 
                                2007.
                                    ``(III) Reference year.--The term 
                                `reference year' means, with respect to 
                                a fiscal year, the 12-month period 
                                preceding August 1 of such fiscal year.
                                    ``(IV) Benchmark rate of growth.--
                                The term `benchmark rate of growth' 
                                means, with respect to a fiscal year, 
                                the product of the projected rate of 
                                growth of children in Medicaid at time 
                                of enactment, multiplied by the number 
                                of fiscal years that have elapsed since 
                                the initial reference year.
                                    ``(V) Projected rate of growth of 
                                children in medicaid at time of 
                                enactment.--The term `projected rate of 
                                growth of children in Medicaid at time 
                                of enactment' means the average annual 
                                rate of growth for children enrolled in 
                                all State plans under this title (or 
                                under waivers of such title) during the 
                                period beginning with fiscal year 2007 
                                and ending with fiscal year 2010, as 
                                projected in March 2007 by the Director 
                                of the Congressional Budget Office.
                            ``(iii) State reporting requirements.--The 
                        State shall submit to the Secretary such data 
                        relating to the average monthly enrollment of 
                        individuals who have not attained age 19 under 
                        this title and title XXI (including under 
                        waivers of such titles) as the Secretary shall 
                        specify for the purpose of increasing under 
                        clause (5) of subsection (b) the Federal 
                        medical assistance percentage for a State for a 
                        fiscal year in accordance with this subsection.
                    ``(B) Determination of increase.--
                            ``(i) In general.--Subject to clause (ii), 
                        for purposes of clause (5) of the first 
                        sentence of subsection (b), in the case of a 
                        State described in subparagraph (A), the number 
                        of percentage points determined under this 
                        subparagraph is equal to the percentage 
                        increase in the State child caseload determined 
                        for purposes of subparagraph (A)(i).
                            ``(ii) Limitation on increase.--In no event 
                        may the Federal medical assistance percentage 
                        for a State for a fiscal year exceed 85 percent 
                        as a result of an increase under this 
                        paragraph.
                    ``(C) Secretarial responsibilities.--
                            ``(i) Review and verification of child 
                        caseload data.--The Secretary shall review the 
                        child caseload data provided by States for 
                        purposes of this paragraph and shall conduct 
                        data matches on a periodic basis to verify the 
                        child caseloads determined for States.
                            ``(ii) Notice to states.--Not later than 
                        September 30 of each fiscal year beginning with 
                        fiscal year 2008, the Secretary shall inform 
                        each State on the extent to which the child 
                        caseload in the most recent reference year 
                        exceeds or does not exceed the benchmark rate 
                        of growth for such fiscal year.
            ``(2) For states that have achieved at least a high 
        participation rate for coverage of uninsured low-income 
        children.--
                    ``(A) In general.--For purposes of clause (5) of 
                the first sentence of subsection (b), a State described 
                in this paragraph is a State--
                            ``(i) for which the percentage of low-
                        income children without private health coverage 
                        who are uninsured (as determined under 
                        subparagraph (D)) is at least 90 percent; and
                            ``(ii) that satisfies the conditions 
                        described in subparagraph (B) (with respect to 
                        coverage of children under this title and title 
                        XXI) and paragraph (1)(A)(iii).
                    ``(B) Conditions described.--The conditions 
                described in this subparagraph are the following:
                            ``(i) Continuous eligibility requirement.--
                        The State has elected the option of continuous 
                        eligibility for a full 12 months for children 
                        described in section 1902(e)(12) under this 
                        title, as well as applying such policy under 
                        its State child health plan under title XXI.
                            ``(ii) No waiting list for title xxi.--The 
                        State does not impose any numerical limitation, 
                        waiting list, or similar limitation on 
                        eligibility for assistance under title XXI and 
                        has not imposed any such limitation or list 
                        within the preceding 3 years.
                            ``(iii) No assets test.--The State does not 
                        apply any assets test for eligibility under 
                        this title or title XXI with respect to 
                        children.
                            ``(iv) Annual reporting of measures of 
                        quality of health care for children.--The State 
                        annually reports on the measures required under 
                        section 601 of the Children's Health Insurance 
                        Program (CHIP) Reauthorization Act of 2007 with 
                        respect to the quality of health care for 
                        children under the State plan under this title 
                        and the State child health plan under title XXI 
                        or is otherwise determined by the Secretary to 
                        have implemented a comprehensive system for 
                        gathering information and reporting on the 
                        quality of health care for children enrolled 
                        under such plans.
                    ``(C) Determination of increase.--
                            ``(i) In general.--Subject to clause (ii), 
                        for purposes of clause (5) of the first 
                        sentence of subsection (b), in the case of a 
                        State described in subparagraph (A), the number 
                        of percentage points determined under this 
                        subparagraph is equal to the number of 
                        percentage points by which the percentage 
                        described in subparagraph (A)(i) exceeds 90 
                        percent.
                            ``(ii) Limitation on increase.--In no event 
                        may the Federal medical assistance percentage 
                        for a State for a fiscal year exceed 85 percent 
                        as a result of an increase under this 
                        paragraph.
                    ``(D) Secretarial responsibilities.--
                            ``(i) Determination of state rates.--The 
                        rates described in subparagraph (A)(i) shall be 
                        determined by the Secretary on the basis of the 
                        2 most recent Annual Social and Economic 
                        Supplements of the Current Population Survey of 
                        the Bureau of the Census.
                            ``(ii) Notice to states.--Not later than 
                        September 30 of each fiscal year beginning with 
                        fiscal year 2008, the Secretary shall inform 
                        each State on the extent to which the State's 
                        participation rate among uninsured low-income 
                        children exceeds or does not exceed 90 percent.
            ``(3) Increase in cap on payments to territories.--If 
        Puerto Rico, the Virgin Islands, Guam, the Northern Mariana 
        Islands, or American Samoa qualify for an increase in the 
        Federal medical assistance percentage under subsection (b)(5) 
        for a fiscal year, the additional Federal financial 
        participation under this title that results from such increase 
        shall not be counted towards the limitation on total payments 
        under this title for such commonwealth or territory otherwise 
        determined under subsections (f) and (g) of section 1108.
            ``(4) Scope of application.--The increase in the Federal 
        medical assistance percentage under subsection (b)(5) shall 
        only apply for purposes of payments under section 1903 with 
        respect to medical assistance provided to individuals who have 
        not attained age 19 and shall not apply with respect to--
                    ``(A) disproportionate share hospital payments 
                described in section 1923;
                    ``(B) payments under title IV or XXI; or
                    ``(C) any payments under this title that are based 
                on the enhanced FMAP described in section 2105(b).''.

SEC. 305. ELIMINATION OF COUNTING MEDICAID CHILD PRESUMPTIVE 
              ELIGIBILITY COSTS AGAINST TITLE XXI ALLOTMENT.

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

SEC. 306. STATE OPTION TO REQUIRE CERTAIN INDIVIDUALS TO PRESENT 
              SATISFACTORY DOCUMENTARY EVIDENCE OF PROOF OF CITIZENSHIP 
              OR NATIONALITY FOR PURPOSES OF ELIGIBILITY FOR MEDICAID.

    (a) In General.--Section 1902(a)(46) (42 U.S.C. 1396a(a)(46)) is 
amended--
            (1) by inserting ``(A)'' after ``(46)'';
            (2) by adding ``and'' after the semicolon; and
            (3) by adding at the end the following new subparagraph:
            ``(B) at the option of the State and subject to section 
        1903(x), require that, with respect to an individual (other 
        than an individual described in section 1903(x)(1)) who 
        declares to be a citizen or national of the United States for 
        purposes of establishing initial eligibility for medical 
        assistance under this title (or, at State option, for purposes 
        of renewing or redetermining such eligibility to the extent 
        that such satisfactory documentary evidence of citizenship or 
        nationality has not yet been presented), there is presented 
        satisfactory documentary evidence of citizenship or nationality 
        of the individual (using criteria determined by the State, 
        which shall be no more restrictive than the criteria used by 
        the Social Security Administration to determine citizenship, 
        and which shall accept as such evidence a document issued by a 
        federally recognized Indian tribe evidencing membership or 
        enrollment in, or affiliation with, such tribe (such as a 
        tribal enrollment card or certificate of degree of Indian 
        blood, and, with respect to those federally recognized Indian 
        tribes located within States having an international border 
        whose membership includes individuals who are not citizens of 
        the United States, such other forms of documentation (including 
        tribal documentation, if appropriate) that the Secretary, after 
        consulting with such tribes, determines to be satisfactory 
        documentary evidence of citizenship or nationality for purposes 
        of satisfying the requirement of this subparagraph));''.
    (b) Limitation on Waiver Authority.--Notwithstanding any provision 
of section 1115 of the Social Security Act (42 U.S.C. 1315), or any 
other provision of law, the Secretary may not waive the requirements of 
section 1902(a)(46)(B) of such Act (42 U.S.C. 1396a(a)(46)(B)) with 
respect to a State.
    (c) Conforming Amendments.--Section 1903 (42 U.S.C. 1396b) is 
amended--
            (1) in subsection (i)--
                    (A) in paragraph (20), by adding ``or'' after the 
                semicolon;
                    (B) in paragraph (21), by striking ``; or'' and 
                inserting a period; and
                    (C) by striking paragraph (22); and
            (2) in subsection (x) (as amended by section 405(c)(1)(A) 
        of division B of the Tax Relief and Health Care Act of 2006 
        (Public Law 109-432))--
                    (A) by striking paragraphs (1) and (3);
                    (B) by redesignating paragraph (2) as paragraph 
                (1);
                    (C) in paragraph (1), as so redesignated, by 
                striking ``paragraph (1)'' and inserting ``section 
                1902(a)(46)(B)''; and
                    (D) by adding at the end the following new 
                paragraph:
    ``(2) In the case of an individual declaring to be a citizen or 
national of the United States with respect to whom a State requires the 
presentation of satisfactory documentary evidence of citizenship or 
nationality under section 1902(a)(46)(B), the individual shall be 
provided at least the reasonable opportunity to present satisfactory 
documentary evidence of citizenship or nationality under this 
subsection as is provided under clauses (i) and (ii) of section 
1137(d)(4)(A) to an individual for the submittal to the State of 
evidence indicating a satisfactory immigration status.''.
    (d) Clarification of Rules for Children Born in the United States 
to Mothers Eligible for Medicaid.--Section 1903(x) (42 U.S.C. 
1396b(x)), as amended by subsection (c)(2), is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (C), by striking ``or'' at the 
                end;
                    (B) by redesignating subparagraph (D) as 
                subparagraph (E); and
                    (C) by inserting after subparagraph (C) the 
                following new subparagraph:
            ``(D) pursuant to the application of section 1902(e)(4) 
        (and, in the case of an individual who is eligible for medical 
        assistance on such basis, the individual shall be deemed to 
        have provided satisfactory documentary evidence of citizenship 
        or nationality and shall not be required to provide further 
        documentary evidence on any date that occurs during or after 
        the period in which the individual is eligible for medical 
        assistance on such basis); or''; and
            (2) by adding at the end the following new paragraph:
    ``(3) Nothing in subparagraph (A) or (B) of section 1902(a)(46), 
the preceding paragraphs of this subsection, or the Deficit Reduction 
Act of 2005, including section 6036 of such Act, shall be construed as 
changing the requirement of section 1902(e)(4) that a child born in the 
United States to an alien mother for whom medical assistance for the 
delivery of such child is available as treatment of an emergency 
medical condition pursuant to subsection (v) shall be deemed eligible 
for medical assistance during the first year of such child's life.''.
    (e) Effective Date.--
            (1) Retroactive application.--The amendments made by this 
        section shall take effect as if included in the enactment of 
        the Deficit Reduction Act of 2005 (Public Law 109-171; 120 
        Stat. 4).
            (2) Restoration of eligibility.--In the case of an 
        individual who, during the period that began on July 1, 2006, 
        and ends on the date of enactment of this Act, was determined 
        to be ineligible for medical assistance under a State Medicaid 
        program solely as a result of the application of subsections 
        (i)(22) and (x) of section 1903 of the Social Security Act (as 
        in effect during such period), but who would have been 
        determined eligible for such assistance if such subsections, as 
        amended by this section, had applied to the individual, a State 
        may deem the individual to be eligible for such assistance as 
        of the date that the individual was determined to be ineligible 
        for such medical assistance on such basis.

                 TITLE IV--START HEALTHY, STAY HEALTHY

SEC. 401. STATE OPTION TO EXPAND OR ADD COVERAGE OF CERTAIN PREGNANT 
              WOMEN UNDER MEDICAID AND CHIP.

    (a) Medicaid.--
            (1) Authority to expand coverage.--Section 1902(l)(2)(A)(i) 
        (42 U.S.C. 1396a(l)(2)(A)(i)) is amended by inserting ``(or 
        such higher percentage as the State may elect for purposes of 
        expenditures for medical assistance for pregnant women 
        described in section 1905(u)(4)(A))'' after ``185 percent''.
            (2) Enhanced matching funds available if certain conditions 
        met.--Section 1905 (42 U.S.C. 1396d) is amended--
                    (A) in the fourth sentence of subsection (b), by 
                striking ``or subsection (u)(3)'' and inserting ``, 
                (u)(3), or (u)(4)''; and
                    (B) in subsection (u)--
                            (i) by redesignating paragraph (4) as 
                        paragraph (5); and
                            (ii) by inserting after paragraph (3) the 
                        following new paragraph:
    ``(4) For purposes of the fourth sentence of subsection (b) and 
section 2105(a), the expenditures described in this paragraph are the 
following:
            ``(A) Certain pregnant women.--If the conditions described 
        in subparagraph (B) are met, expenditures for medical 
        assistance for pregnant women described in subsection (n) or in 
        section 1902(l)(1)(A) in a family the income of which exceeds 
        185 percent of the poverty line, but does not exceed the income 
        eligibility level established under title XXI for a targeted 
        low-income child.
            ``(B) Conditions.--The conditions described in this 
        subparagraph are the following:
                    ``(i) The State plans under this title and title 
                XXI do not provide coverage for pregnant women 
                described in subparagraph (A) with higher family income 
                without covering such pregnant women with a lower 
                family income.
                    ``(ii) The State does not apply an effective income 
                level for pregnant women that is lower than the 
                effective income level (expressed as a percent of the 
                poverty line and considering applicable income 
                disregards) specified under the State plan under 
                subsection (a)(10)(A)(i)(III) or (l)(2)(A) of section 
                1902, on the date of enactment of this paragraph to be 
                eligible for medical assistance as a pregnant woman.
            ``(C) Definition of poverty line.--In this subsection, the 
        term `poverty line' has the meaning given such term in section 
        2110(c)(5).''.
            (3) Payment from title xxi allotment for medicaid expansion 
        costs.--Section 2105(a)(1) (42 U.S.C. 1397ee(a)(1)), as amended 
        by section 305, is amended by striking subparagraph (B) and 
        inserting the following new subparagraph:
                    ``(B) for the portion of the payments made for 
                expenditures described in section 1905(u)(4)(A) that 
                represents the additional amount paid for such 
                expenditures as a result of the enhanced FMAP being 
                substituted for the Federal medical assistance 
                percentage of such expenditures;''.
    (b) CHIP.--
            (1) Coverage.--Title XXI (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 
        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 
        income official poverty line; and
            ``(2) the State meets the conditions described in section 
        1905(u)(4)(B).
    ``(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 the effective 
                income level (expressed as a percent of the poverty 
                line and considering applicable income disregards) 
                specified under subsection (a)(10)(A)(i)(III) or 
                (l)(2)(A) of section 1902, on January 1, 2008, to be 
                eligible for medical assistance as a pregnant woman 
                under title XIX 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) in the 
                same manner as a child applying for child health 
                assistance would have to satisfy such requirements.
    ``(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) The reference in section 2107(e)(1)(F) to section 
        1920A (relating to presumptive eligibility for children) is 
        deemed a reference to section 1920 (relating to presumptive 
        eligibility for pregnant women).
    ``(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) Additional conforming amendments.--
                    (A) No cost sharing for pregnancy-related 
                benefits.--Section 2103(e)(2) (42 U.S.C. 1397cc(e)(2)) 
                is amended--
                            (i) in the heading, by inserting ``or 
                        pregnancy-related services'' after ``preventive 
                        services''; and
                            (ii) by inserting before the period at the 
                        end the following: ``or for pregnancy-related 
                        services''.
                    (B) No waiting period.--Section 2102(b)(1)(B) (42 
                U.S.C. 1397bb(b)(1)(B)) is amended--
                            (i) in clause (i), by striking ``, and'' at 
                        the end and inserting a semicolon;
                            (ii) in clause (ii), by striking the period 
                        at the end and inserting ``; and''; and
                            (iii) by adding at the end the following 
                        new clause:
                            ``(iii) may not apply a waiting period 
                        (including a waiting period to carry out 
                        paragraph (3)(C)) in the case of a targeted 
                        low-income pregnant woman.''.
    (c) Other Amendments to Medicaid.--
            (1) Eligibility of a newborn.--Section 1902(e)(4) (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) 
        (42 U.S.C. 1396r-1(b)) is amended by adding after paragraph (2) 
        the following new flush sentence:
``The term `qualified provider' includes a qualified entity as defined 
in section 1920A(b)(3).''.

SEC. 402. COORDINATION WITH THE MATERNAL AND CHILD HEALTH PROGRAM.

    (a) In General.--Section 2102(b)(3) (42 U.S.C. 1397bb(b)(3)) is 
amended--
            (1) in subparagraph (D), by striking ``and'' at the end;
            (2) in subparagraph (E), by striking the period at the end 
        and inserting ``; and''; and
            (3) 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.''.
    (b) Conforming Medicaid Amendment.--Section 1902(a)(11) (42 U.S.C. 
1396a(a)(11)) is amended--
            (1) by striking ``and'' before ``(C)''; and
            (2) 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''.

SEC. 403. OPTIONAL COVERAGE OF LEGAL IMMIGRANTS UNDER MEDICAID AND 
              CHIP.

    (a) Medicaid Program.--Section 1903(v) (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) CHIP.--Section 2107(e)(1) (42 U.S.C. 1397gg(e)(1)), as amended 
by sections 301(b) and 302(b)(2), is amended by redesignating 
subparagraphs (D), (E), and (F) as subparagraphs (E), (F), and (G), 
respectively, and by inserting after subparagraph (B) the following new 
subparagraph:
                    ``(C) 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.''.

SEC. 404. IMPROVING BENCHMARK COVERAGE OPTIONS.

    (a) Limitation on Use of Secretary-Approved Coverage.--Section 
2103(a)(4) (42 U.S.C. 1397cc(a)(4)) is amended by striking the period 
at the end and inserting ``, but only if such determination was made 
before March 1, 2007.''.
    (b) State Employee Coverage Benchmark.--Section 2103(b)(2) (42 
U.S.C. 1397(b)(2)) is amended--
            (1) by striking ``A health benefits coverage plan'' and 
        inserting ``The health benefits coverage plan''; and
            (2) by inserting ``and that has the largest enrollment 
        among such employees with dependent coverage in either of the 
        previous 2 plan years'' before the period.

SEC. 405. REQUIRING COVERAGE OF DENTAL AND MENTAL HEALTH SERVICES.

    (a) Required Coverage of Dental and Mental Health Services.--
Section 2103 (42 U.S.C. 1397cc(c)) is amended--
            (1) in subsection (a), in the matter preceding paragraph 
        (1), by striking ``subsection (c)(5)'' and inserting 
        ``paragraphs (5) and (6) of subsection (c)''; and
            (2) in subsection (c)--
                    (A) by redesignating paragraph (5) as paragraph 
                (6); and
                    (B) by inserting after paragraph (4), the following 
                new paragraph:
            ``(5) Other required services.--The child health assistance 
        provided to a targeted low-income child shall include coverage 
        of the following:
                    ``(A) Dental services.--Dental services described 
                in section 1905(r)(3) and provided in accordance with 
                section 1902(a)(43).
                    ``(B) Mental health services.--Mental health 
                services.''.
    (b) State Child Health Plan Requirement.--Section 2102(a)(7)(B) (42 
U.S.C. 1397bb(c)(2)) is amended by inserting ``and services described 
in section 2103(c)(5)'' after ``emergency services''
    (c) Conforming Amendments.--Section 2103(c)(2) (42 U.S.C. 
1397cc(c)(2)) is amended--
            (1) by striking subparagraph (B); and
            (2) by redesignating subparagraphs (C) and (D) as 
        subparagraphs (B) and (C), respectively.

SEC. 406. CLARIFICATION OF REQUIREMENT TO PROVIDE EPSDT SERVICES FOR 
              ALL CHILDREN IN BENCHMARK BENEFIT PACKAGES UNDER 
              MEDICAID.

    (a) In General.--Section 1937(a)(1), as inserted by section 6044(a) 
of the Deficit Reduction Act of 2005, is amended--
            (1) in subparagraph (A)--
                    (A) in the matter before clause (i), by striking 
                ``Notwithstanding any other provision of this title'' 
                and inserting ``Subject to subparagraph (E)''; and
                    (B) by striking ``enrollment in coverage that 
                provides'' and all that follows and inserting 
                ``benchmark coverage described in subsection (b)(1) or 
                benchmark equivalent coverage described in subsection 
                (b)(2).'';
            (2) by striking subparagraph (C) and inserting the 
        following new subparagraph:
                    ``(C) State option to provide additional 
                benefits.--A State, at its option, may provide such 
                additional benefits to benchmark coverage described in 
                subsection (b)(1) or benchmark equivalent coverage 
                described in subsection (b)(2) as the State may 
                specify.''; and
            (3) by adding at the end the following new subparagraph:
                    ``(E) Requiring coverage of epsdt services.--
                Nothing in this paragraph shall be construed as 
                affecting a child's entitlement to care and services 
                described in subsections (a)(4)(B) and (r) of section 
                1905 and provided in accordance with section 
                1903(a)(43) whether provided through benchmark 
                coverage, benchmark equivalent coverage, or 
                otherwise.''.
    (b) Effective Date.--The amendments made by this subsection shall 
take effect as if included in the amendment made by section 6044(a) of 
the Deficit Reduction Act of 2005.

SEC. 407. CHILDHOOD OBESITY DEMONSTRATION PROJECT.

    (a) Authority To Conduct Demonstration.--The Secretary, in 
consultation with the Administrator of the Centers for Medicare & 
Medicaid Services, shall conduct a demonstration project to develop a 
comprehensive and systematic model for reducing childhood obesity by 
awarding grants to eligible entities to carry out such project. Such 
model shall--
            (1) identify, through self-assessment, behavioral risk 
        factors for obesity among children;
            (2) identify, through self-assessment, needed clinical 
        preventive and screening benefits among those children 
        identified as target individuals on the basis of such risk 
        factors;
            (3) provide ongoing support to such target individuals and 
        their families to reduce risk factors and promote the 
        appropriate use of preventive and screening benefits; and
            (4) be designed to improve health outcomes, satisfaction, 
        quality of life, and appropriate use of items and services for 
        which medical assistance is available under title XIX of the 
        Social Security Act or child health assistance is available 
        under title XXI of such Act among such target individuals.
    (b) Eligibility Entities.--For purposes of this section, an 
eligible entity is any of the following:
            (1) A city, county, or Indian tribe.
            (2) A local or tribal educational agency.
            (3) An accredited university, college, or community 
        college.
            (4) A federally-qualified health center.
            (5) A local health department.
            (6) A health care provider.
            (7) A community-based organization.
            (8) Any other entity determined appropriate by the 
        Secretary, including a consortia or partnership of entities 
        described in any of paragraphs (1) through (7).
    (c) Use of Funds.--An eligible entity awarded a grant under this 
section shall use the funds made available under the grant to--
            (1) carry out community-based activities related to 
        reducing childhood obesity, including by--
                    (A) forming partnerships with entities, including 
                schools and other facilities providing recreational 
                services, to establish programs for after school and 
                weekend community activities that are designed to 
                reduce childhood obesity;
                    (B) forming partnerships with daycare facilities to 
                establish programs that promote healthy eating 
                behaviors and physical activity; and
                    (C) developing and evaluating community educational 
                activities targeting good nutrition and promoting 
                healthy eating behaviors;
            (2) carry out age-appropriate school-based activities that 
        are designed to reduce childhood obesity, including by--
                    (A) developing and testing educational curricula 
                and intervention programs designed to promote healthy 
                eating behaviors and habits in youth, which may 
                include--
                            (i) after hours physical activity programs; 
                        and
                            (ii) science-based interventions with 
                        multiple components to prevent eating disorders 
                        including nutritional content, understanding 
                        and responding to hunger and satiety, positive 
                        body image development, positive self-esteem 
                        development, and learning life skills (such as 
                        stress management, communication skills, 
                        problem-solving and decisionmaking skills), as 
                        well as consideration of cultural and 
                        developmental issues, and the role of family, 
                        school, and community;
                    (B) providing education and training to educational 
                professionals regarding how to promote a healthy 
                lifestyle and a healthy school environment for 
                children;
                    (C) planning and implementing a healthy lifestyle 
                curriculum or program with an emphasis on healthy 
                eating behaviors and physical activity; and
                    (D) planning and implementing healthy lifestyle 
                classes or programs for parents or guardians, with an 
                emphasis on healthy eating behaviors and physical 
                activity for children;
            (3) carry out activities through the local health care 
        delivery systems including by--
                    (A) promoting healthy eating behaviors and physical 
                activity services to treat or prevent eating disorders, 
                being overweight, and obesity;
                    (B) providing patient education and counseling to 
                increase physical activity and promote healthy eating 
                behaviors;
                    (C) training health professionals on how to 
                identify and treat obese and overweight individuals 
                which may include nutrition and physical activity 
                counseling; and
                    (D) providing community education by a health 
                professional on good nutrition and physical activity to 
                develop a better understanding of the relationship 
                between diet, physical activity, and eating disorders, 
                obesity, or being overweight; and
            (4) provide, through qualified health professionals, 
        training and supervision for community health workers to--
                    (A) educate families regarding the relationship 
                between nutrition, eating habits, physical activity, 
                and obesity;
                    (B) educate families about effective strategies to 
                improve nutrition, establish healthy eating patterns, 
                and establish appropriate levels of physical activity; 
                and
                    (C) educate and guide parents regarding the ability 
                to model and communicate positive health behaviors.
    (d) Priority.--In awarding grants under subsection (a), the 
Secretary shall give priority to awarding grants to eligible entities--
            (1) that demonstrate that they have previously applied 
        successfully for funds to carry out activities that seek to 
        promote individual and community health and to prevent the 
        incidence of chronic disease and that can cite published and 
        peer-reviewed research demonstrating that the activities that 
        the entities propose to carry out with funds made available 
        under the grant are effective;
            (2) that will carry out programs or activities that seek to 
        accomplish a goal or goals set by the State in the Healthy 
        People 2010 plan of the State;
            (3) that provide non-Federal contributions, either in cash 
        or inkind, to the costs of funding activities under the grants;
            (4) that develop comprehensive plans that include a 
        strategy for extending program activities developed under 
        grants in the years following the fiscal years for which they 
        receive grants under this section;
            (5) located in communities that are medically underserved, 
        as determined by the Secretary;
            (6) located in areas in which the average poverty rate is 
        at least 150 percent or higher of the average poverty rate in 
        the State involved, as determined by the Secretary; and
            (7) that submit plans that exhibit multisectoral, 
        cooperative conduct that includes the involvement of a broad 
        range of stakeholders, including--
                    (A) community-based organizations;
                    (B) local governments;
                    (C) local educational agencies;
                    (D) the private sector;
                    (E) State or local departments of health;
                    (F) accredited colleges, universities, and 
                community colleges;
                    (G) health care providers;
                    (H) State and local departments of transportation 
                and city planning; and
                    (I) other entities determined appropriate by the 
                Secretary.
    (e) Program Design.--
            (1) Initial design.--Not later than 1 year after the date 
        of enactment of this Act, the Secretary shall design the 
        demonstration project. The demonstration should draw upon 
        promising, innovative models and incentives to reduce 
        behavioral risk factors. The Administrator of the Centers for 
        Medicare & Medicaid Services shall consult with the Director of 
        the Centers for Disease Control and Prevention, the Director of 
        the Office of Minority Health, the heads of other agencies in 
        the Department of Health and Human Services, and such 
        professional organizations, as the Secretary determines to be 
        appropriate, on the design, conduct, and evaluation of the 
        demonstration.
            (2) Number and project areas.--Not later than 2 years after 
        the date of enactment of this Act, the Secretary shall award 1 
        grant that is specifically designed to determine whether 
        programs similar to programs to be conducted by other grantees 
        under this section should be implemented with respect to the 
        general population of children who are eligible for child 
        health assistance under State child health plans under title 
        XXI of the Social Security Act in order to reduce the incidence 
        of childhood obesity among such population.
    (f) Report to Congress.--Not later than 3 years after the date the 
Secretary implements the demonstration project under this section, the 
Secretary shall submit to Congress a report that describes the project, 
evaluates the effectiveness and cost effectiveness of the project, 
evaluates the beneficiary satisfaction under the project, and includes 
any such other information as the Secretary determines to be 
appropriate.
    (g) Definitions.--In this section:
            (1) Federally-qualified health center.--The term 
        ``Federally-qualified health center'' has the meaning given 
        that term in section 1905(l)(2)(B) of the Social Security Act 
        (42 U.S.C. 1396d(l)(2)(B)).
            (2) Indian tribe.--The term ``Indian tribe'' has the 
        meaning given that term in section 4 of the Indian Health Care 
        Improvement Act (25 U.S.C. 1603).
            (3) Self-assessment.--The term ``self-assessment'' means a 
        form that--
                    (A) includes questions regarding--
                            (i) behavioral risk factors;
                            (ii) needed preventive and screening 
                        services; and
                            (iii) target individuals' preferences for 
                        receiving follow-up information;
                    (B) is assessed using such computer generated 
                assessment programs; and
                    (C) allows for the provision of such ongoing 
                support to the individual as the Secretary determines 
                appropriate.
            (4) Ongoing support.--The term ``ongoing support'' means--
                    (A) to provide any target individual with 
                information, feedback, health coaching, and 
                recommendations regarding--
                            (i) the results of a self-assessment given 
                        to the individual;
                            (ii) behavior modification based on the 
                        self-assessment; and
                            (iii) any need for clinical preventive and 
                        screening services or treatment including 
                        medical nutrition therapy;
                    (B) to provide any target individual with referrals 
                to community resources and programs available to assist 
                the target individual in reducing health risks; and
                    (C) to provide the information described in 
                subparagraph (A) to a health care provider, if 
                designated by the target individual to receive such 
                information.
    (h) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section, $25,000,000 for each of fiscal 
years 2008 through 2012.

         TITLE V--IMPROVING ACCESS TO HEALTH CARE FOR CHILDREN

SEC. 501. PROMOTING CHILDREN'S ACCESS TO COVERED HEALTH SERVICES.

    (a) Medicaid and CHIP Payment and Access Commission.--Title XIX (42 
U.S.C. 1396 et seq.) is amended by inserting before section 1901 the 
following new section:

           ``medicaid and chip payment and access commission

    ``Sec. 1900.  (a) Establishment.--There is hereby established the 
Medicaid and CHIP Payment and Access Commission (in this section 
referred to as `MACPAC').
    ``(b) Duties.--
            ``(1) Review of access policies and annual reports.--MACPAC 
        shall--
                    ``(A) review policies of the Medicaid program 
                established under this title (in this section referred 
                to as `Medicaid') and the State Children's Health 
                Insurance Program established under title XXI (in this 
                section referred to as `CHIP') affecting children's 
                access to covered items and services, including topics 
                described in paragraph (2);
                    ``(B) make recommendations to Congress concerning 
                such access policies;
                    ``(C) by not later than March 1 of each year 
                (beginning with 2009), submit a report to Congress 
                containing the results of such reviews and MACPAC's 
                recommendations concerning such policies; and
                    ``(D) by not later than June 1 of each year 
                (beginning with 2009), submit a report to Congress 
                containing an examination of issues affecting Medicaid 
                and CHIP, including the implications of changes in 
                health care delivery in the United States and in the 
                market for health care services on such programs.
            ``(2) Specific topics to be reviewed.--Specifically, MACPAC 
        shall review and assess the following:
                    ``(A) Medicaid and chip payment policies.--Payment 
                policies under Medicaid and CHIP, including--
                            ``(i) the factors affecting expenditures 
                        for items and services in different sectors, 
                        including the process for updating hospital, 
                        skilled nursing facility, physician, Federally-
                        qualified health center, rural health center, 
                        and other fees;
                            ``(ii) payment methodologies; and
                            ``(iii) the relationship of such factors 
                        and methodologies to access and quality of care 
                        for Medicaid and CHIP beneficiaries.
                    ``(B) Interaction of medicaid and chip payment 
                policies with health care delivery generally.--The 
                effect of Medicaid and CHIP payment policies on access 
                to items and services for children and other Medicaid 
                and CHIP populations other than under this title or 
                title XXI and the implications of changes in health 
                care delivery in the United States and in the general 
                market for health care items and services on Medicaid 
                and CHIP.
                    ``(C) Other access policies.--The effect of other 
                Medicaid and CHIP policies on access to covered items 
                and services, including policies relating to 
                transportation and language barriers.
            ``(3) Creation of early-warning system.--MACPAC shall 
        create an early-warning system to identify provider shortage 
        areas or any other problems that threaten access to care or the 
        health care status of Medicaid and CHIP beneficiaries.
            ``(4) Comments on certain secretarial reports.--If the 
        Secretary submits to Congress (or a committee of Congress) a 
        report that is required by law and that relates to access 
        policies, including with respect to payment policies, under 
        Medicaid or CHIP, the Secretary shall transmit a copy of the 
        report to MACPAC. MACPAC shall review the report and, not later 
        than 6 months after the date of submittal of the Secretary's 
        report to Congress, shall submit to the appropriate committees 
        of Congress written comments on such report. Such comments may 
        include such recommendations as MACPAC deems appropriate.
            ``(5) Agenda and additional reviews.--MACPAC shall consult 
        periodically with the chairmen and ranking minority members of 
        the appropriate committees of Congress regarding MACPAC's 
        agenda and progress towards achieving the agenda. MACPAC may 
        conduct additional reviews, and submit additional reports to 
        the appropriate committees of Congress, from time to time on 
        such topics relating to the program under this title or title 
        XXI as may be requested by such chairmen and members and as 
        MACPAC deems appropriate.
            ``(6) Availability of reports.--MACPAC shall transmit to 
        the Secretary a copy of each report submitted under this 
        subsection and shall make such reports available to the public.
            ``(7) Appropriate committee of congress.--For purposes of 
        this section, the term `appropriate committees of Congress' 
        means the Committee on Energy and Commerce of the House of 
        Representatives and the Committee on Finance of the Senate.
            ``(8) Voting and reporting requirements.--With respect to 
        each recommendation contained in a report submitted under 
        paragraph (1), each member of MACPAC shall vote on the 
        recommendation, and MACPAC shall include, by member, the 
        results of that vote in the report containing the 
        recommendation.
            ``(9) Examination of budget consequences.--Before making 
        any recommendations, MACPAC shall examine the budget 
        consequences of such recommendations, directly or through 
        consultation with appropriate expert entities.
    ``(c) Membership.--
            ``(1) Number and appointment.--MACPAC shall be composed of 
        17 members appointed by the Comptroller General of the United 
        States.
            ``(2) Qualifications.--
                    ``(A) In general.--The membership of MACPAC shall 
                include individuals who have had direct experience as 
                enrollees or parents of enrollees in Medicaid or CHIP 
                and individuals with national recognition for their 
                expertise in Federal safety net health programs, health 
                finance and economics, actuarial science, health 
                facility management, health plans and integrated 
                delivery systems, reimbursement of health facilities, 
                health information technology, pediatric physicians, 
                dentists, and other providers of health services, and 
                other related fields, who provide a mix of different 
                professionals, broad geographic representation, and a 
                balance between urban and rural representatives.
                    ``(B) Inclusion.--The membership of MACPAC shall 
                include (but not be limited to) physicians and other 
                health professionals, employers, third-party payers, 
                and individuals with expertise in the delivery of 
                health services. Such membership shall also include 
                consumers representing children, pregnant women, the 
                elderly, and individuals with disabilities, current or 
                former representatives of State agencies responsible 
                for administering Medicaid, and current or former 
                representatives of State agencies responsible for 
                administering CHIP.
                    ``(C) Majority nonproviders.--Individuals who are 
                directly involved in the provision, or management of 
                the delivery, of items and services covered under 
                Medicaid or CHIP shall not constitute a majority of the 
                membership of MACPAC.
                    ``(D) Ethical disclosure.--The Comptroller General 
                of the United States shall establish a system for 
                public disclosure by members of MACPAC of financial and 
                other potential conflicts of interest relating to such 
                members. Members of MACPAC shall be treated as 
                employees of Congress for purposes of applying title I 
                of the Ethics in Government Act of 1978 (Public Law 95-
                521).
            ``(3) Terms.--
                    ``(A) In general.--The terms of members of MACPAC 
                shall be for 3 years except that the Comptroller 
                General of the United States shall designate staggered 
                terms for the members first appointed.
                    ``(B) Vacancies.--Any member appointed to fill a 
                vacancy occurring before the expiration of the term for 
                which the member's predecessor was appointed shall be 
                appointed only for the remainder of that term. A member 
                may serve after the expiration of that member's term 
                until a successor has taken office. A vacancy in MACPAC 
                shall be filled in the manner in which the original 
                appointment was made.
            ``(4) Compensation.--While serving on the business of 
        MACPAC (including travel time), a member of MACPAC shall be 
        entitled to compensation at the per diem equivalent of the rate 
        provided for level IV of the Executive Schedule under section 
        5315 of title 5, United States Code; and while so serving away 
        from home and the member's regular place of business, a member 
        may be allowed travel expenses, as authorized by the Chairman 
        of MACPAC. Physicians serving as personnel of MACPAC may be 
        provided a physician comparability allowance by MACPAC in the 
        same manner as Government physicians may be provided such an 
        allowance by an agency under section 5948 of title 5, United 
        States Code, and for such purpose subsection (i) of such 
        section shall apply to MACPAC in the same manner as it applies 
        to the Tennessee Valley Authority. For purposes of pay (other 
        than pay of members of MACPAC) and employment benefits, rights, 
        and privileges, all personnel of MACPAC shall be treated as if 
        they were employees of the United States Senate.
            ``(5) Chairman; vice chairman.--The Comptroller General of 
        the United States shall designate a member of MACPAC, at the 
        time of appointment of the member as Chairman and a member as 
        Vice Chairman for that term of appointment, except that in the 
        case of vacancy of the Chairmanship or Vice Chairmanship, the 
        Comptroller General of the United States may designate another 
        member for the remainder of that member's term.
            ``(6) Meetings.--MACPAC shall meet at the call of the 
        Chairman.
    ``(d) Director and Staff; Experts and Consultants.--Subject to such 
review as the Comptroller General of the United States deems necessary 
to assure the efficient administration of MACPAC, MACPAC may--
            ``(1) employ and fix the compensation of an Executive 
        Director (subject to the approval of the Comptroller General of 
        the United States) and such other personnel as may be necessary 
        to carry out its duties (without regard to the provisions of 
        title 5, United States Code, governing appointments in the 
        competitive service);
            ``(2) seek such assistance and support as may be required 
        in the performance of its duties from appropriate Federal 
        departments and agencies;
            ``(3) enter into contracts or make other arrangements, as 
        may be necessary for the conduct of the work of MACPAC (without 
        regard to section 3709 of the Revised Statutes (41 U.S.C. 5));
            ``(4) make advance, progress, and other payments which 
        relate to the work of MACPAC;
            ``(5) provide transportation and subsistence for persons 
        serving without compensation; and
            ``(6) prescribe such rules and regulations as it deems 
        necessary with respect to the internal organization and 
        operation of MACPAC.
    ``(e) Powers.--
            ``(1) Obtaining official data.--MACPAC may secure directly 
        from any department or agency of the United States information 
        necessary to enable it to carry out this section. Upon request 
        of the Chairman, the head of that department or agency shall 
        furnish that information to MACPAC on an agreed upon schedule.
            ``(2) Data collection.--In order to carry out its 
        functions, MACPAC shall--
                    ``(A) utilize existing information, both published 
                and unpublished, where possible, collected and assessed 
                either by its own staff or under other arrangements 
                made in accordance with this section;
                    ``(B) carry out, or award grants or contracts for, 
                original research and experimentation, where existing 
                information is inadequate; and
                    ``(C) adopt procedures allowing any interested 
                party to submit information for MACPAC's use in making 
                reports and recommendations.
            ``(3) Access of gao to information.--The Comptroller 
        General of the United States shall have unrestricted access to 
        all deliberations, records, and nonproprietary data of MACPAC, 
        immediately upon request.
            ``(4) Periodic audit.--MACPAC shall be subject to periodic 
        audit by the Comptroller General of the United States.
    ``(f) Authorization of Appropriations.--
            ``(1) Request for appropriations.--MACPAC shall submit 
        requests for appropriations in the same manner as the 
        Comptroller General of the United States submits requests for 
        appropriations, but amounts appropriated for MACPAC shall be 
        separate from amounts appropriated for the Comptroller General 
        of the United States.
            ``(2) Authorization.--There are authorized to be 
        appropriated such sums as may be necessary to carry out the 
        provisions of this section.''.
    (b) Deadline for Initial Appointments.--Not later than January 1, 
2008, the Comptroller General of the United States shall appoint the 
initial members of the Medicaid and CHIP Payment and Access Commission 
established under section 1900 of the Social Security Act (as added by 
subsection (a)).

SEC. 502. INSTITUTE OF MEDICINE STUDY AND REPORT ON CHILDREN'S ACCESS 
              TO HEALTH CARE.

    (a) Study.--
            (1) In general.--The Secretary shall enter into a contract 
        with the Institute of Medicine of the National Academy of 
        Sciences (in this section referred to as the ``Institute''), to 
        update the data and analyses of the June 1998 report of the 
        Institute entitled, ``America's Children: Health Insurance and 
        Access to Care''. Specifically, the Institute shall--
                    (A) examine the extent of health insurance coverage 
                for children in the United States; and
                    (B) analyze the extent to which there is evidence 
                of the relationship between health insurance coverage 
                and children's access to health care.
            (2) Requirement.--In carrying out the study required under 
        paragraph (1), the Institute shall focus on a broad range of 
        providers that offer health care services to children, 
        including (but not limited to) providers of oral health care 
        services and mental health care services.
            (3) Support.--The Secretary shall provide to the Institute 
        any relevant data available to the Secretary during the period 
        in which the study required under paragraph (1) is conducted.
    (b) Report.--Not later than 18 months after the date of enactment 
of this Act, the Secretary and the Institute shall submit a report to 
Congress on the results of the study conducted under subsection (a).
    (c) Appropriations.--Out of any funds in the Treasury not otherwise 
appropriated, there is appropriated for fiscal year 2008 such sums as 
may be necessary for the purpose of carrying out this section, not to 
exceed $1,000,000. Funds appropriated under this subsection shall 
remain available until expended.

TITLE VI--STRENGTHENING QUALITY OF CARE AND HEALTH OUTCOMES OF CHILDREN

SEC. 601. STRENGTHENING CHILD HEALTH QUALITY IMPROVEMENT ACTIVITIES.

    (a) Updating and Enhancement of Quality of Care Measures for 
Children.--
            (1) In general.--Not later than January 1, 2009, the 
        Secretary shall do the following:
                    (A) Update and enhance quality measures.--In 
                consultation with States, providers, and child health 
                experts, update and enhance the HEDIS measures and 
                other measures that the Secretary recommends States use 
                to annually report on the quality of health care for 
                children enrolled in Medicaid or CHIP to include 
                additional and more comprehensive information with 
                respect to health care delivered to children in both 
                ambulatory and inpatient care settings, that can be 
                used to develop national quality measures and perform 
                comparative analyses.
                    (B) Encourage voluntary reporting.--In consultation 
                with States, develop procedures to encourage States to 
                voluntarily report the same set of measures with 
                respect to the quality of health care for children 
                under Medicaid and CHIP.
                    (C) Adoption of best practices.--Develop programs 
                to identify best practices with respect to the quality 
                of health care for children and facilitate the adoption 
                of such best practices, including in areas such as 
                provider reporting compliance, successful quality 
                improvement strategies, and improved efficiency in data 
                collection using health information technology.
                    (D) Technical assistance.--Provide technical 
                assistance to States to help them comply with the 
                measures updated in accordance with subparagraph (A) 
                and adopt the best practices identified in accordance 
                with subparagraph (C).
    (b) Dissemination of Health Quality Information.--
            (1) State-specific report on child health quality 
        measures.--Not later than January 1, 2008, and annually 
        thereafter, the Secretary shall collect, analyze, and make 
        publicly available State-specific data on child health quality 
        measures, including State-specific data collected on external 
        quality review activities related to managed care organizations 
        under Medicaid and CHIP.
            (2) Reports to congress.--Not later than January 1, 2008, 
        and every 3 years thereafter, the Secretary shall report to 
        Congress on--
                    (A) the status of the Secretary's efforts to 
                improve--
                            (i) children's health care, including 
                        children's needs with respect to preventive, 
                        acute, and chronic health care; and
                            (ii) all domains of quality, including 
                        safety, family experience of care, and 
                        elimination of disparities; and
                    (B) the quality of care furnished to ameliorate at 
                least 1 type of physical, mental, or developmental 
                condition recognized as having an effect on growth and 
                development in children and adolescents.
    (c) Development, Endorsement, and Updating of Child-Specific Health 
Quality Measures.--
            (1) In general.--Not later than January 1, 2009, the 
        Secretary shall establish a program to support the development 
        of quality measures for children's health care services.
            (2) Authority to award grants and contracts.--As part of 
        such program, the Secretary shall award grants and contracts 
        for the--
                    (A) development of new child health quality 
                measures to supplement or replace, as appropriate, the 
                HEDIS measures updated and enhanced in accordance with 
                subsection (a)(1)(A);
                    (B) advancement (through validation and consensus 
                among the entities described in paragraph (3)) of such 
                new measures and of child health quality measures used 
                as of the date of enactment of this Act; and
                    (C) updating of such measures as necessary.
            (3) Consultation required.--In carrying out the program 
        required under this subsection, the Secretary shall consult 
        with the following:
                    (A) Establishment of areas of need and 
                priorities.--For purposes of identifying gaps in child 
                health quality measures used as of the date of 
                enactment of this Act and establishing priorities for 
                development:
                            (i) States.
                            (ii) National pediatric organizations.
                            (iii) Consumers.
                            (iv) Other entities with expertise in 
                        pediatric quality measures, such as quality 
                        improvement organizations.
                    (B) Establishment of portfolio of measures.--For 
                purposes of developing a portfolio of child health 
                quality measures for use by States, other purchasers, 
                and providers, an organization involved in the 
                advancement of consensus on evidence-based measures of 
                health care, such as the National Quality Forum.
                    (C) Establishment of medicaid and chip core 
                pediatric quality measures.--For purposes of 
                identifying a core pediatric data set that includes 
                specific quality measures for Medicaid and CHIP, 
                States, health care providers, consumers, purchasers, 
                child health experts, and public and private 
                organizations with experience and expertise in the 
                outreach and enrollment of children in public and 
                private health insurance programs.
            (4) Specific requirements for medicaid and chip pediatric 
        quality measures.--
                    (A) Core pediatric data set.--The core pediatric 
                data set identified under paragraph (3)(C) shall 
                include specific quality measures for Medicaid and 
                CHIP, including with respect to at least the following:
                            (i) State-specific quality measures for 
                        Medicaid and CHIP (including State-specific 
                        data on enrollment and retention of eligible 
                        children; coordination of Medicaid and CHIP 
                        children's coverage; measures of children's 
                        access to preventive, acute and chronic care, 
                        including the availability of providers and 
                        adequacy of provider payments relative to 
                        private coverage).
                            (ii) Quality measures and data for health 
                        plans and providers at the State, plan, and 
                        provider levels of care.
                    (B) Quality measures.--In identifying quality 
                measures for Medicaid and CHIP, the Secretary shall--
                            (i) identify measures specific to managed 
                        care plans and providers of primary care case 
                        management services;
                            (ii) build on the core set of quality 
                        measures reported by States as of the date of 
                        enactment of this Act, including the HEDIS 
                        measures and evidence-based measures (to the 
                        extent such measures are available);
                            (iii) assure that the measures identified 
                        are selected from measures that have been 
                        approved through an independent process that 
                        includes a broad consensus determined by a 
                        voluntary, standard setting organization, with 
                        broad participation by providers, patient 
                        advocates, health plans, and purchasers;
                            (iv) assure that the measures place an 
                        emphasis on physical and mental conditions for 
                        which amelioration is necessary to promote 
                        growth and development;
                            (v) assure that the measures are evidence-
                        based and risk adjusted;
                            (vi) assure that the measures are designed 
                        to identify and eliminate racial and ethnic 
                        disparities in the provision of care;
                            (vii) assure that the data required for 
                        such measures is collected and reported in a 
                        standard format that permits comparison of 
                        quality and data at a State, plan, and provider 
                        level; and
                            (viii) periodically update such measures.
    (d) Demonstration Projects for Improving the Quality of Children's 
Health Care and the Use of Health Information Technology.--
            (1) In general.--The Secretary shall award grants to States 
        and child health providers to conduct demonstration projects to 
        evaluate promising ideas for improving the quality of 
        children's health care, including projects to--
                    (A) experiment with, and evaluate the use of, new 
                measures of the quality of children's health care 
                (including testing the validity and suitability for 
                reporting of such measures);
                    (B) promote the use of health information 
                technology in care delivery for children; or
                    (C) evaluate value-based purchasing of health care 
                services for children.
            (2) Authority for multi-state projects.--A demonstration 
        project conducted with a grant awarded under this subsection 
        may be conducted on a multi-State basis, as needed.
    (e) Increased Matching Rate for Collecting and Reporting on Child 
Health Measures.--Section 1903(a)(3)(A) (42 U.S.C. 1396b(a)(3)(A)), as 
amended by section 302, is amended--
            (1) by striking ``and'' at the end of clause (ii); and
            (2) by adding at the end the following new clause:
                    ``(iv) an amount equal to 75 percent of so much of 
                the sums expended during such quarter (as found 
                necessary by the Secretary for the proper and efficient 
                administration of the State plan) as are attributable 
                to such developments or modifications of systems of the 
                type described in clause (i) as are necessary for the 
                efficient collection and reporting on child health 
                measures; and''.
    (f) Development of Model Electronic Health Record for Children.--
Not later than January 1, 2009, the Secretary shall establish a program 
to encourage the development and dissemination of a model electronic 
health record for children. Such model electronic health record should 
be--
            (1) subject to State laws, accessible to parents and other 
        consumers for the sole purpose of demonstrating compliance with 
        school or leisure activity requirements, such as appropriate 
        immunizations or physicals; and
            (2) designed to allow interoperable exchanges that conform 
        with Federal and State privacy and security requirements.
    (g) Definition of HEDIS Measures.--In this section, the term 
``HEDIS measures'' means the Health Plan Employer Data and Information 
Set (HEDIS) measures established by the National Committee for Quality 
Assurance (NCQA).
    (h) Appropriations.--Out of any funds in the Treasury not otherwise 
appropriated, there is appropriated for each of fiscal years 2008 
through 2012, $20,000,000 for the purpose of carrying out this section. 
Funds appropriated under this subsection shall remain available until 
expended.

SEC. 602. APPLICATION OF CERTAIN MANAGED CARE QUALITY SAFEGUARDS TO 
              CHIP.

    Section 2107(e)(1) (42 U.S.C. 1397gg(e)(1)), as amended by sections 
301(b), 302(b)(2), and 403(b), is amended by redesignating subparagraph 
(G) as subparagraph (H), and by inserting after subparagraph (F) the 
following new subparagraph:
                    ``(G) Subsections (a)(5), (b), (c), (d), and (e) of 
                section 1932 (relating to requirements for managed 
                care).''.

                     TITLE VII--OTHER IMPROVEMENTS

SEC. 701. STRENGTHENING PREMIUM ASSISTANCE PROGRAMS.

    (a) Improving the Cost-Effectiveness Standard.--Section 2105(c)(3) 
(42 U.S.C. 1397ee(c)(3)) is amended--
            (1) by redesignating subparagraphs (A) and (B) as clauses 
        (i) and (ii) and indenting appropriately;
            (2) by striking ``Payment may be made'' and inserting the 
        following:
                    ``(A) In general.--Subject to the succeeding 
                provisions of this paragraph, payment may be made''; 
                and
            (3) by adding at the end the following new subparagraph:
                    ``(B) Improvements in cost-effectiveness measure.--
                            ``(i) Application of family-based test.--
                        Coverage described in subparagraph (A) shall be 
                        deemed cost-effective if the State establishes 
                        to the satisfaction of the Secretary that the 
                        cost of such coverage is less than the 
                        expenditures that the State would have made to 
                        enroll the family in the State child health 
                        plan.
                            ``(ii) Aggregate program operational costs 
                        do not exceed the cost of providing coverage 
                        under the state child health plan.--In the case 
                        of a State that does not establish cost-
                        effectiveness under clause (i), payment may not 
                        be made under subsection (a)(1) for the 
                        purchase of any coverage described in 
                        subparagraph (A) for a family unless the State 
                        establishes to the satisfaction of the 
                        Secretary that the aggregate amount of 
                        expenditures by the State for the purchase of 
                        all such coverage (including administrative 
                        expenditures) does not exceed the aggregate 
                        amount of expenditures that the State would 
                        have made for providing coverage under the 
                        State child health plan for all such 
                        families.''.
    (b) Disclosure of Group Health Plan Benefits.--Section 2105(c)(3) 
(42 U.S.C. 1397ee(c)(3)), as amended by subsections (a) and (b), is 
amended by adding at the end the following new subparagraph:
                    ``(D) Disclosure of group health plan benefits.--
                Notwithstanding any other provision of law, the plan 
                administrator of a group health plan in which 
                participants or beneficiaries are covered under a State 
                plan under title XIX or this title, shall disclose to 
                the State, upon request, information about the benefits 
                available under the group health plan in sufficient 
                specificity so that the State may determine--
                            ``(i) whether purchasing coverage for the 
                        participant or beneficiary under the group 
                        health plan meets the cost-effectiveness 
                        standard applied under subparagraph (B); and
                            ``(ii) what additional benefits and cost-
                        sharing assistance must be provided to ensure 
                        that the participant or beneficiary receives 
                        through the provision of additional benefits by 
                        the State, benefits that are equivalent to the 
                        coverage that would be provided to such 
                        participant or beneficiary under such State 
                        plan.''.
    (c) Approval of Section 1115 Waivers for Premium Assistance.--
Section 1115 (42 U.S.C. 1315) is amended by inserting after subsection 
(c), the following new subsection:
    ``(d) In approving a request by a State for an experimental, pilot, 
or demonstration project under this section with respect to the 
purchase of private insurance for individuals eligible for assistance 
under title XIX or XXI, the Secretary shall not waive compliance with 
requirements of such titles or treat expenditures under the project as 
expenditures under the State plans approved under such titles unless 
the State demonstrates both of the following:
            ``(1) The fact that an individual is enrolled in a group 
        health plan or an insurance plan purchased on the individual 
        market shall not change the individual's eligibility for 
        assistance under the such State plans.
            ``(2) The cost to the Federal Government and State of 
        purchasing private insurance for the individual (including 
        administrative costs), as well as any additional costs incurred 
        in providing items and services covered under such State plans 
        but not through the private insurance for such individual, does 
        not exceed, on an average per individual basis, the cost of 
        providing coverage to the individual directly under such State 
        plans.''.
    (d) GAO Study and Report.--Not later than January 1, 2009, the 
Comptroller General of the United States shall study cost and coverage 
issues relating to State premium assistance programs for which Federal 
matching payments are made under title XIX or XXI of the Social 
Security Act and submit a report to Congress on the results of such 
study.

SEC. 702. PERMITTING COVERAGE OF CHILDREN OF EMPLOYEES OF A PUBLIC 
              AGENCY IN THE STATE.

    Section 2110(b) (42 U.S.C. 1397jj(b)) is amended--
            (1) in paragraph (2)(B), by inserting ``except as provided 
        in paragraph (5),'' before ``a child''; and
            (2) by adding at the end the following new paragraph:
            ``(5) Exceptions to exclusion of children of employees of a 
        public agency in the state.--
                    ``(A) In general.--A child shall not be considered 
                to be described in paragraph (2)(B) if--
                            ``(i) the public agency that employs a 
                        member of the child's family to which such 
                        paragraph applies satisfies subparagraph (B); 
                        or
                            ``(ii) subparagraph (C) applies to such 
                        child.
                    ``(B) Maintenance of effort with respect to per 
                person agency contribution for family coverage.--For 
                purposes of subparagraph (A)(i), a public agency 
                satisfies this subparagraph if the amount of annual 
                agency expenditures made on behalf of each employee 
                enrolled in health coverage paid for by the agency that 
                includes dependent coverage for the most recent State 
                fiscal year is not less than the amount of such 
                expenditures made by the agency for the 1997 State 
                fiscal year, increased by the percentage increase in 
                the medical care expenditure category of the Consumer 
                Price Index for All-Urban Consumers (all items: U.S. 
                City Average) for such preceding fiscal year.
                    ``(C) Hardship exception.--For purposes of 
                subparagraph (A)(ii), this subparagraph applies to a 
                child if the State determines, on a case-by-case basis, 
                that the annual aggregate amount of premiums and cost-
                sharing imposed for coverage of the family of the child 
                would exceed 5 percent of such family's income for the 
                year involved.''.

SEC. 703. IMPROVING DATA COLLECTION.

    (a) Increased Appropriation.--Section 2109(b)(2) (42 U.S.C. 
1397ii(b)(2)) is amended by striking ``$10,000,000 for fiscal year 
2000'' and inserting ``$20,000,000 for fiscal year 2008''.
    (b) Use of Additional Funds.--Section 2109(b) (42 U.S.C. 
1397ii(b)), as amended by subsection (a), is amended--
            (1) by redesignating paragraph (2) as paragraph (3); and
            (2) by inserting after paragraph (1), the following new 
        paragraph:
            ``(2) Additional requirements.--In addition to making the 
        adjustments required to produce the data described in paragraph 
        (1), with respect to data collection occurring for fiscal years 
        beginning with fiscal year 2008, in appropriate consultation 
        with the Secretary of Health and Human Services, the Secretary 
        of Commerce shall do the following:
                    ``(A) Make appropriate adjustments to the Current 
                Population Survey to develop more accurate State-
                specific estimates of the number of children enrolled 
                in health coverage under title XIX or this title.
                    ``(B) Make appropriate adjustments to the Current 
                Population Survey to improve the survey estimates used 
                to compile the State-specific and national number of 
                low-income children without health insurance for 
                purposes of sections 1905(y)(2)(A)(i), 
                2106(b)(3)(B)(iii)(I), and 2104(i)(3)(D)(i).
                    ``(C) Assist in the incorporation of health 
                insurance survey information in the American Community 
                Survey related to children.
                    ``(D) Assess whether American Community Survey 
                estimates, once such survey data are first available, 
                produce more reliable estimates than the Current 
                Population Survey for purposes of section 
                2104(i)(3)(D)(i).
                    ``(E) Recommend to the Secretary of Health and 
                Human Services whether American Community Survey 
                estimates should be used for purposes of 
                2104(i)(3)(D)(i).
                    ``(F) Continue making the adjustments described in 
                the last sentence of paragraph (1) with respect to 
                expansion of the sample size used in State sampling 
                units, the number of sampling units in a State, and 
                using an appropriate verification element.''.

SEC. 704. MORATORIUM ON APPLICATION OF PERM REQUIREMENTS RELATED TO 
              ELIGIBILITY REVIEWS DURING PERIOD OF INDEPENDENT STUDY 
              AND REPORT.

    (a) Moratorium.--Notwithstanding parts 431 and 457 of title 42, 
Code of Federal Regulations, or any other provision of law, except as 
provided in paragraph (2), during the period that begins on the date of 
enactment of this Act and ends on the final effective date for the 
regulations required under subsection (c), the Secretary shall not 
apply the payment error rate measurement (PERM) requirements related to 
eligibility reviews imposed under such parts with respect to Medicaid 
or CHIP.
    (b) Study and Report.--
            (1) Institute of medicine study.--The Secretary shall enter 
        into a contract with the Institute of Medicine of the National 
        Academy of Sciences (in this section referred to as the 
        ``Institute'') to conduct an independent study of the payment 
        error rate measurement (PERM) requirements related to 
        eligibility reviews imposed under parts 431 and 457 of title 
        42, Code of Federal Regulations with respect to Medicaid and 
        CHIP and established in accordance with the Improper Payments 
        Information Act of 2002 (Public Law 107-300). Such study shall 
        examine and develop recommendations for modifying such 
        requirements in order to--
                    (A) minimize the administrative cost burden on 
                States under Medicaid and CHIP;
                    (B) avoid inadvertent error findings with respect 
                to such programs despite compliance with Federal and 
                State policies and procedures in effect as of the date 
                of the submission of the claim or action that led to 
                such finding;
                    (C) maintain State flexibility to manage such 
                programs; and
                    (D) ensure that such requirements do not interfere 
                with State efforts to simplify application and renewal 
                procedures that increase enrollment in Medicaid and 
                CHIP and do not reduce beneficiary participation in 
                such programs.
            (2) Support.--The Secretary shall provide the Institute 
        with any relevant data available to the Secretary during the 
        period in which the study required under paragraph (1) is 
        conducted.
            (3) Report.--Not later than the date that is 18 months 
        after the date of enactment of this Act, the Institute shall 
        submit to the Secretary and Congress a report on the results of 
        the study conducted under this subsection.
    (c) Regulations.--Not later than 6 months after the date on which 
the report required under subsection (b)(3) has been submitted to the 
Secretary, the Secretary, after taking into consideration the 
recommendations contained in the report, shall promulgate such 
regulations revising the PERM requirements as the Secretary determines 
are appropriate.
    (d) Appropriations.--Out of any funds in the Treasury not otherwise 
appropriated, there is appropriated for fiscal year 2008 such sums as 
may be necessary for the purpose of carrying out this section, not to 
exceed $1,000,000. Funds appropriated under this subsection shall 
remain available until expended.

SEC. 705. ELIMINATION OF CONFUSING PROGRAM REFERENCES.

    Section 704 of the Medicare, Medicaid, and SCHIP Balanced Budget 
Refinement Act of 1999, as enacted into law by division B of Public Law 
106-113 (113 Stat. 1501A-402) is repealed.

                       TITLE VIII--EFFECTIVE DATE

SEC. 801. EFFECTIVE DATE.

    (a) In General.--Unless otherwise provided, subject to subsection 
(b), the amendments made by this Act shall take effect on October 1, 
2007, and shall apply to child health assistance and medical assistance 
provided on or after that date without regard to whether or not final 
regulations to carry out such amendments have been promulgated by such 
date.
    (b) Exception for State Legislation.--In the case of a State plan 
under title XIX or XXI of the Social Security Act, which the Secretary 
determines requires State legislation in order for the plan to meet the 
additional requirements imposed by an amendment made by this Act, the 
State plan shall not be regarded as failing to comply with the 
requirements of such Act solely on the basis of its failure to meet 
these additional requirements before the first day of the first 
calendar quarter beginning after the close of the first regular session 
of the State legislature that begins after the date of enactment of 
this Act. For purposes of the preceding sentence, in the case of a 
State that has a 2-year legislative session, each year of the session 
shall be considered to be a separate regular session of the State 
legislature.
                                 <all>