1.Short title; table of
contents
(a)This Act may be cited as the Kids Come First Act of 2007
.
(b)The table of contents of this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings.
TITLE I—EXPANDED COVERAGE OF CHILDREN UNDER MEDICAID AND
SCHIP
Sec. 101. State option to receive 100 percent FMAP for medical
assistance for children in poverty in exchange for expanded coverage of
children in working poor families under Medicaid or SCHIP.
Sec. 102. Elimination of cap on SCHIP funding for States that
expand eligibility for children.
TITLE II—STATE OPTIONS FOR INCREMENTAL CHILD COVERAGE
EXPANSIONS
Sec. 201. State option to provide wrap-around SCHIP coverage to
children who have other health coverage.
Sec. 202. State option to enroll low-income children of State
employees in SCHIP.
Sec. 203. Optional coverage of legal immigrant children under
Medicaid and SCHIP.
Sec. 204. State option for passive renewal of eligibility for
children under Medicaid and SCHIP.
TITLE III—TAX INCENTIVES FOR HEALTH INSURANCE COVERAGE OF
CHILDREN
Sec. 301. Refundable credit for health insurance coverage of
children.
Sec. 302. Forfeiture of personal exemption for any child not
covered by health insurance.
TITLE IV—MISCELLANEOUS
Sec. 401. Requirement for group market health insurers to offer
dependent coverage option for workers with children.
Sec. 402. Effective date.
TITLE V—REVENUE PROVISION
Sec. 501. Partial repeal of rate reduction in the highest
income tax bracket.
2.Congress makes the following
findings:
(1)Need for
universal coverage
(A)Currently, there
are 9,000,000 children under the age of 19 that are uninsured. One out of every
8 children are uninsured while 1 in 5 Hispanic children and 1 in 7 African
American children are uninsured. Three-quarters, approximately 6,800,000, of
these children are eligible but not enrolled in the Medicaid program or the
State Children’s Health Insurance Program (SCHIP). Long-range studies found
that 1 in 3 children went without health insurance for all or part of 2002 and
2003.
(B)Low-income
children are 3 times as likely as children in higher income families to be
uninsured. It is estimated that 65 percent of uninsured children have at least
1 parent working full time over the course of the year.
(C)It is estimated
that 50 percent of all legal immigrant children in families with income that is
less than 200 percent of the Federal poverty line are uninsured. In States
without programs to cover immigrant children, 57 percent of noncitizen children
are uninsured.
(D)Children in the
Southern and Western parts of the United States were nearly 1.7 times more
likely to be uninsured than children in the Northeast. In the Northeast, 9.4
percent of children are uninsured while in the Midwest, 8.3 percent are
uninsured. The South’s rate of uninsured children is 14.3 percent while the
West has an uninsured rate of 13 percent.
(E)Children’s health
care needs are neglected in the United States. One out of every 5 children has
problems accessing needed care and one-quarter of young children in the United
States are not fully up to date on their basic immunizations. One-third of
children with chronic asthma do not get a prescription for the necessary
medications to manage the disease and 1 out of every 4 children do not receive
annual dental exams.
(F)Children without
health insurance are twice as likely as insured children to not receive any
medical care in a given year. According to the Centers for Disease Control and
Prevention, nearly 1/2 of all uninsured children have not
had a well-child visit in the past year. One in 6 uninsured children had a
delayed or unmet medical need in the past year. Minority children are less
likely to receive proven treatments such as prescription medications to treat
chronic disease.
(G)There are
7,600,000 young adults between the ages of 19 and 20. In the United States,
approximately 28 percent, or 2,100,000 individuals, of this group are
uninsured.
(H)Chronic illness
and disability among children are on the rise. Children most at risk for
chronic illness and disability are children who are most likely to be poor and
uninsured.
(2)Role of the
medicaid and state children’s health insurance programs
(A)The Medicaid
program and SCHIP serve as a crucial health safety net for 30,000,000 children.
During the recent economic downturn and the highest number of uninsured
individuals ever recorded in the United States, the Medicaid program and SCHIP
offset losses in employer-sponsored coverage. While the number of children
living in low-income families increased between 2000 and 2005, the number of
uninsured children fell due to the Medicaid program and SCHIP.
(B)28,000,000
children are enrolled today in the Medicaid program, accounting for
1/2 of all enrollees and only 18 percent of total program
costs.
(C)The Medicaid
program and SCHIP do more than just fill in the gaps. Gains in public coverage
have reduced the percentage of low-income uninsured children by
1/3 from 1997 to 2005. In addition, a study found that
publicly-insured children are more likely to obtain medical care, preventive
care, and dental care than similar low-income privately-insured
children.
(D)Publicly funded
programs such as the Medicaid program and SCHIP actually improve children’s
health. Children who are currently insured by public programs are in better
health than they were a year ago. Expansion of coverage for children and
pregnant women under the Medicaid program and SCHIP reduces rates of avoidable
hospitalizations by 22 percent and has been proven to reduce childhood deaths,
infant mortality rates, and the incidence of low birth weight.
(E)Studies have
found that children enrolled in public insurance programs experienced a
68-percent improvement in measures of school performance.
(F)Despite the
success of expansions in general under the Medicaid program and SCHIP, due to
current budget constraints, many States have stopped doing aggressive outreach
and have raised premiums and cost-sharing requirements on families under these
programs. In addition, 8 States stopped enrollment in SCHIP for a period of
time between April 2003 and July 2004. As a result, SCHIP enrollment fell by
200,000 children for the first time in the program’s history.
(G)It is estimated
that nearly 50 percent of children covered through SCHIP do not remain in the
program due to reenrollment barriers. A recent study found that between 10 and
40 percent of these children are lost
in the system. Difficult
renewal policies and reenrollment barriers make seamless coverage in SCHIP
unattainable. Studies indicate that as many as 67 percent of children who were
eligible but not enrolled for SCHIP had applied for coverage but were denied
due to procedural issues.
(H)While the
Medicaid program and SCHIP expansions to date have done much to offset what
otherwise would have been a significant loss of coverage among children because
of declining access to employer coverage, the shortcomings of previous
expansions, such as the failure to enroll all eligible children and caps on
enrollment in SCHIP because of under-funding, also are clear.
<enum>I</enum><header>EXPANDED COVERAGE
OF CHILDREN UNDER MEDICAID AND SCHIP</header>
<section id="ID16EE785E84D0456F926FF1DBE7B7D43C"><enum>101.</enum><header>State option
to receive 100 percent FMAP for medical assistance for children in poverty in
exchange for expanded coverage of children in working poor families under
Medicaid or SCHIP</header>
<subsection id="ID0C412E74D7F14C9DB858BBEB467B4833"><enum>(a)</enum><header>State
Option</header><text>Title XIX of the <act-name parsable-cite="SSA">Social
Security Act</act-name> (42 U.S.C. 1396 et seq.) is amended by redesignating
section 1939 as section 1940, and by inserting after section 1938 the
following:</text>
<quoted-block act-name="Social Security Act" id="IDCA5B11CC2FF04DF090D8721593B6A457" style="traditional">
<section id="ID5D9FFBDECE4F4D198BCA357716F8922A"><enum>1939.</enum><header>State option for increased FMAP for medical assistance for
children in poverty in exchange for expanded coverage of children in working
poor families under this title <enum-in-header>OR</enum-in-header> title
<enum-in-header>XXI</enum-in-header></header><subsection commented="no" display-inline="yes-display-inline" id="ID73FFF18B8632480FB5CFCCD07F3F75B0"><enum>(a)</enum><header>100 Percent
FMAP</header>
<paragraph id="ID42636FDAF692492E8CC48891174B1934"><enum>(1)</enum><header>In
general</header><text>Notwithstanding any other provision of this title, in the
case of a State that, through an amendment to each of its State plans under
this title and title XXI (or to a waiver of either such plan), agrees to
satisfy the conditions described in subsections (b), (c), and (d), the Federal
medical assistance percentage shall be 100 percent with respect to the total
amount expended by the State for providing medical assistance under this title
for each fiscal year quarter beginning on or after the date described in
subsection (e) for children whose family income does not exceed 100 percent of
the poverty line.</text>
</paragraph><paragraph id="ID515C4A62FC7E46EA8AAD1B95C01ECB17"><enum>(2)</enum><header>Limitation on
scope of application of increase</header><text>The increase in the Federal
medical assistance percentage for a State under this section shall apply only
with respect to the total amount expended for providing medical assistance
under this title for a fiscal year quarter for children described in paragraph
(1) and shall not apply with respect to—</text>
<subparagraph id="IDCB039F0090C34F5B9C4A0197F8460239"><enum>(A)</enum><text>any other
payments made under this title, including disproportionate share hospital
payments described in section 1923;</text>
</subparagraph><subparagraph id="IDBF136BE4B6C24FA89C1A47F418C7BF17"><enum>(B)</enum><text>payments under
title IV or XXI; or</text>
</subparagraph><subparagraph id="IDD9FFEFCA122346C5BE4661FEC09853E8"><enum>(C)</enum><text>any payments made
under this title or title XXI that are based on the enhanced FMAP described in
section 2105(b).</text>
</subparagraph></paragraph></subsection><subsection id="IDC968CDCF1C994022B01A17EECBC4BAD4"><enum>(b)</enum><header>Eligibility
Expansions</header><text>The condition described in this subsection is that the
State agrees to do the following:</text>
<paragraph id="IDED436DC6B4004AA3A529877D463CD9D1"><enum>(1)</enum><header>Coverage under
medicaid or schip for children in families whose income does not exceed 300
percent of the poverty line</header>
<subparagraph id="IDF0246B10D34D4932BCAA77EE682F04D0"><enum>(A)</enum><header>In
general</header><text>The State agrees to provide medical assistance under this
title or child health assistance under title XXI to children whose family
income exceeds the medicaid applicable income level (as defined in section
2110(b)(4) but by substituting <quote>January 1, 2007</quote> for <quote>March
31, 1997</quote>), but does not exceed 300 percent of the poverty line.</text>
</subparagraph><subparagraph id="ID8A5C9B20D3A04EFC8CE33E7C02290C88"><enum>(B)</enum><header>State option to
expand coverage through subsidized purchase of family coverage</header><text>A
State may elect to carry out subparagraph (A) through the provision of
assistance for the purchase of dependent coverage under a group health plan or
health insurance coverage if—</text>
<clause id="ID9C9845CA049442A19273086B87DEE566"><enum>(i)</enum><text>the dependent
coverage is consistent with the benefit standards under this title or title
XXI, as approved by the Secretary; and</text>
</clause><clause id="ID437455F9717647A598F5F66D291A6DEE"><enum>(ii)</enum><text>the State
provides <quote>wrap-around</quote> coverage under this title or title
XXI.</text>
</clause></subparagraph><subparagraph id="ID67111FEB59E741C5844196218608F86F"><enum>(C)</enum><header>Deemed
satisfaction for certain states</header><text>A State that, as of January 1,
2007, provides medical assistance under this title or child health assistance
under title XXI to children whose family income is 300 percent of the poverty
line shall be deemed to satisfy this paragraph.</text>
</subparagraph></paragraph><paragraph id="ID408362FC14E64EC3BC0E2D6010F216FB"><enum>(2)</enum><header>Coverage for
children under age 21</header><text>The State agrees to define a child for
purposes of this title and title XXI as an individual who has not attained 21
years of age.</text>
</paragraph><paragraph id="ID1CDF58F54B7D479F9593F2767476C677"><enum>(3)</enum><header>Opportunity for
higher income children to purchase schip coverage</header><text>The State
agrees to permit any child whose family income exceeds 300 percent of the
poverty line to purchase full or <quote>wrap-around</quote> coverage under
title XXI at the full cost of providing such coverage, as determined by the
State.</text>
</paragraph><paragraph id="ID1EAFAB3B75F1412A873E3254F079BA5B"><enum>(4)</enum><header>Coverage for
legal immigrant children</header><text>The State agrees to—</text>
<subparagraph id="ID1DA7108304FB42819736D2524C00CBC0"><enum>(A)</enum><text>provide medical
assistance under this title and child health assistance under title XXI for
alien children who are lawfully residing in the United States (including
battered aliens described in section 431(c) of the Personal Responsibility and
Work Opportunity Reconciliation Act of 1996) and who are otherwise eligible for
such assistance in accordance with section 1903(v)(4) and 2107(e)(1)(F);
and</text>
</subparagraph><subparagraph id="ID25393398EF7A4F079B75D3DB882558C6"><enum>(B)</enum><text>not establish or
enforce barriers that deter applications by such aliens, including through the
application of the removal of the barriers described in subsection (c).</text>
</subparagraph></paragraph></subsection><subsection id="IDF2F6898D27B4404994393CE4437F1947"><enum>(c)</enum><header>Removal of
Enrollment and Access Barriers</header><text>The condition described in this
subsection is that the State agrees to do the following:</text>
<paragraph id="ID7C5C5F48657C474F9016D91C3B999A69"><enum>(1)</enum><header>Presumptive
eligibility for children</header><text>The State agrees to—</text>
<subparagraph id="ID9E054C2CFAB3429EBC4209A7871E28C0"><enum>(A)</enum><text>provide
presumptive eligibility for children under this title and title XXI in
accordance with section 1920A; and</text>
</subparagraph><subparagraph id="ID98073B0E95FD413E9EEEA1AE65559F5B"><enum>(B)</enum><text>treat any items
or services that are provided to an uncovered child (as defined in section
2110(c)(8)) who is determined ineligible for medical assistance under this
title as child health assistance for purposes of paying a provider of such
items or services, so long as such items or services would be considered child
health assistance for a targeted low-income child under title XXI.</text>
</subparagraph></paragraph><paragraph id="ID0E46189A332D44C8912A2A632C1D8269"><enum>(2)</enum><header>Adoption of
12-month continuous enrollment</header><text>The State agrees to provide that
eligibility for assistance under this title and title XXI shall not be
regularly redetermined more often than once every year for children.</text>
</paragraph><paragraph id="ID6709A3F32F86430EB41061B2866CCC0D"><enum>(3)</enum><header>Acceptance of
self-declaration of income</header><text>The State agrees to permit the family
of a child applying for medical assistance under this title or child health
assistance under title XXI to declare and certify by signature under penalty of
perjury family income for purposes of collecting financial eligibility
information.</text>
</paragraph><paragraph id="ID1C3CE42D6688454FA10EA46FCE40A929"><enum>(4)</enum><header>Adoption of
acceptance of eligibility determinations for other assistance
programs</header><text>The State agrees to accept determinations (made within a
reasonable period, as found by the State, before its use for this purpose) of
an individual’s family or household income made by a Federal or State agency
(or a public or private entity making such determination on behalf of such
agency), including the agencies administering the
<act-name parsable-cite="FSA77">Food Stamp Act of 1977</act-name>, the Richard
B. Russell <act-name parsable-cite="NSLA">National School Lunch Act</act-name>,
and the <act-name parsable-cite="CNA66">Child Nutrition Act of 1966</act-name>,
notwithstanding any differences in budget unit, disregard, deeming, or other
methodology, but only if—</text>
<subparagraph id="IDCDE77E997E31416A81AB2AC090148711"><enum>(A)</enum><text>such agency has
fiscal liabilities or responsibilities affected or potentially affected by such
determinations; and</text>
</subparagraph><subparagraph id="IDDD8D0489B8BF42F8AC416397C70A69C1"><enum>(B)</enum><text>any information
furnished by such agency pursuant to this subparagraph is used solely for
purposes of determining eligibility for medical assistance under this title or
for child health assistance under title XXI.</text>
</subparagraph></paragraph><paragraph id="IDFC701B74E9C7472C9E493640515EA6AF"><enum>(5)</enum><header>No assets
test</header><text>The State agrees to not (or demonstrates that it does not)
apply any assets or resources test for eligibility under this title or title
XXI with respect to children.</text>
</paragraph><paragraph id="ID4403C5522C8D434D877CFA7949A14C1C"><enum>(6)</enum><header>Eligibility
determinations and redeterminations</header>
<subparagraph id="ID23D18F68CADE4DAAA98F300571FE47F7"><enum>(A)</enum><header>In
general</header><text>The State agrees for purposes of initial eligibility
determinations and redeterminations of children under this title and title XXI
not to require a face-to-face interview and to permit applications and renewals
by mail, telephone, and the Internet.</text>
</subparagraph><subparagraph id="IDA204741A67E84C84BBB41E8D8C9E0302"><enum>(B)</enum><header>Nonduplication
of information</header>
<clause id="ID81CEF8B39A1E4C3AAE06B09B2EFFF1B9"><enum>(i)</enum><header>In
general</header><text>For purposes of redeterminations of eligibility for
currently or previously enrolled children under this title and title XXI, the
State agrees to use all information in its possession (including information
available to the State under other Federal or State programs) to determine
eligibility or redetermine continued eligibility before seeking similar
information from parents.</text>
</clause><clause id="ID4C63F78FA7B74F8FAA57D7B61F685C33"><enum>(ii)</enum><header>Rule of
construction</header><text>Nothing in clause (i) shall be construed as limiting
any obligation of a State to provide notice and a fair hearing before denying,
terminating, or reducing a child’s coverage based on such information in the
possession of the State.</text>
</clause></subparagraph></paragraph><paragraph id="IDEFAE5E057FD74F06B86B0D2CE4687052"><enum>(7)</enum><header>No waiting list
for children under schip</header><text>The State agrees to not impose any
numerical limitation, waiting list, waiting period, or similar limitation on
the eligibility of children for child health assistance under title XXI or to
establish or enforce other barriers to the enrollment of eligible children
based on the date of their application for coverage.</text>
</paragraph><paragraph id="ID4464F1634A8F4931AE2E8E0B845E6538"><enum>(8)</enum><header>Adequate
provider payment rates</header><text>The State agrees to—</text>
<subparagraph id="IDC2640D0668914DA786266BA89AC37F75"><enum>(A)</enum><text>establish payment
rates for children’s health care providers under this title that are no less
than the average of payment rates for similar services for such providers
provided under the benchmark benefit packages described in section
2103(b);</text>
</subparagraph><subparagraph id="IDF0C1B2D305DE4D2EA1C8946B296C1000"><enum>(B)</enum><text>establish such
rates in amounts that are sufficient to ensure that children enrolled under
this title or title XXI have adequate access to comprehensive care, in
accordance with the requirements of section 1902(a)(30)(A); and</text>
</subparagraph><subparagraph id="ID259A9C329685406BACDD7EB07CDE3F21"><enum>(C)</enum><text>include
provisions in its contracts with providers under this title guaranteeing
compliance with these requirements.</text>
</subparagraph></paragraph></subsection><subsection id="ID0F270AD3905C4056A14D667C4EDF4560"><enum>(d)</enum><header>Maintenance of
Medicaid Eligibility Levels for Children</header>
<paragraph id="ID0E72A29F02E244B281DEAF84D560D076"><enum>(1)</enum><header>In
general</header><text>The condition described in this subsection is that the
State agrees to maintain eligibility income, resources, and methodologies
applied under this title (including under a waiver of such title or under
section 1115) with respect to children that are no more restrictive than the
eligibility income, resources, and methodologies applied with respect to
children under this title (including under such a waiver) as of January 1,
2007.</text>
</paragraph><paragraph id="IDAF429BC099DC4BB59DA788B794EB9370"><enum>(2)</enum><header>Rule of
construction</header><text>Nothing in this section shall be construed as
implying that a State does not have to comply with the minimum income levels
required for children under section 1902(l)(2).</text>
</paragraph></subsection><subsection id="ID7DE12F48CE214D5FBD9CD539797577DB"><enum>(e)</enum><header>Date
Described</header><text>The date described in this subsection is the date on
which, with respect to a State, a plan amendment that satisfies the
requirements of subsections (b), (c), and (d) is approved by the
Secretary.</text>
</subsection><subsection id="IDB738651ABCB44068A50654C6F0AD35B5"><enum>(f)</enum><header>Definition of
Poverty Line</header><text>In this section, the term <term>poverty line</term>
has the meaning given that term in section
2110(c)(5).</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDBB8740769D5C4547997BF2A8B972106F"><enum>(b)</enum><header>Conforming
Amendments</header>
<paragraph id="IDA5867B0BC74E4BA59936DF3B18AF2608"><enum>(1)</enum><text>The third
sentence of section 1905(b) of the <act-name parsable-cite="SSA">Social
Security Act</act-name> (42 U.S.C. 1396d(b)) is amended by inserting before the
period the following: <quote>, and with respect to amounts expended for medical
assistance for children on or after the date described in subsection (e) of
section 1939, in the case of a State that has, in accordance with such section,
an approved plan amendment under this title and title XXI</quote>.</text>
</paragraph><paragraph id="ID8236EA1E1D954887A9D45035F3EDBF64"><enum>(2)</enum><text>Section
1903(f)(4) of the <act-name parsable-cite="SSA">Social Security Act</act-name>
(42 U.S.C. 1396b(f)(4)) is amended—</text>
<subparagraph id="ID947CCCF50E4C4F8D830B31C5896B8347"><enum>(A)</enum><text>in subparagraph
(C), by adding <quote>or</quote> after <quote>section 1611(b)(1),</quote>;
and</text>
</subparagraph><subparagraph id="ID88BB9F22E6144137AFCB517E0CCC3612"><enum>(B)</enum><text>by inserting
after subparagraph (C), the following:</text>
<quoted-block id="ID8CB455A83E094AD0A16E4D423F2C7FD1" style="OLC">
<subparagraph id="ID2A76DBFA2B6B485CB0466BA848B247FB" indent="up1"><enum>(D)</enum><text>who would not receive such medical
assistance but for State electing the option under section 1939 and satisfying
the conditions described in subsections (b), (c), and (d) of such
section,</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></subsection></section><section id="IDCF805FC309514D768690EB8CCB843D6B"><enum>102.</enum><header>Elimination of
cap on SCHIP funding for States that expand eligibility for children</header>
<subsection id="ID016A42EC8E2F464F8C4BF4E7FE79DDCD"><enum>(a)</enum><header>In
General</header><text>Section 2105 of the <act-name parsable-cite="SSA">Social
Security Act</act-name> (42 U.S.C. 1397dd) is amended by adding at the end the
following:</text>
<quoted-block act-name="Social Security Act" id="ID9408CB66ECC24EDF8C25F44B4618D58A" style="OLC">
<subsection id="IDCA908E97E3EF489284FDE8852ACA8328"><enum>(h)</enum><header>Guaranteed
Funding for Child Health Assistance for Coverage Expansion States</header>
<paragraph id="IDC081A7A35F2446F2B12143336CBABA4D"><enum>(1)</enum><header>In
general</header><text>Only in the case of a State that has, in accordance with
section 1939, an approved plan amendment under this title and title XIX, any
payment cap that would otherwise apply to the State under this title as a
result of having expended all allotments available for expenditure by the State
with respect to a fiscal year shall not apply with respect to amounts expended
by the State on or after the date described in section 1939(e).</text>
</paragraph><paragraph id="ID07850CE0DB2D44219503F6A91FBF6D26"><enum>(2)</enum><header>Appropriation</header><text>There
is appropriated, out of any money in the Treasury not otherwise appropriated,
such sums as may be necessary for the purpose of paying a State described in
paragraph (1) for each quarter beginning on or after the date described in
section 1939(e), an amount equal to the enhanced FMAP of expenditures described
in paragraph (1) and incurred during such
quarter.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID19B2B0E44A7F4ACD8F49EF307837C356"><enum>(b)</enum><header>Conforming
Amendments</header><text>Section 2104 of the <act-name parsable-cite="SSA">Social Security Act</act-name> (42 U.S.C. 1397dd) is
amended—</text>
<paragraph id="ID2EDFC91EEC8D43DAA739D6D2BA265106"><enum>(1)</enum><text>in subsection
(a), by inserting <quote>and section 2105(h)</quote> after <quote>subsection
(d)</quote>;</text>
</paragraph><paragraph id="ID1E05201DD5044DA6B838DC5E9F3766E1"><enum>(2)</enum><text>in subsection
(b)(1), by striking <quote>and subsection (d)</quote> and inserting <quote>,
subsection (d), and section 2105(h)</quote>; and</text>
</paragraph><paragraph id="ID2A689BD93AAA47158E738A7DAC0D17FE"><enum>(3)</enum><text>in subsection
(c)(1), by inserting <quote>and section 2105(h)</quote> after <quote>subsection
(d)</quote>.</text>
</paragraph></subsection></section><enum>II</enum><header>STATE OPTIONS
FOR INCREMENTAL CHILD COVERAGE EXPANSIONS</header>
<section id="IDE208DAE83CE2488D95DE0E7B55300418"><enum>201.</enum><header>State option
to provide wrap-around SCHIP coverage to children who have other health
coverage</header>
<subsection id="ID80E441227D8046399B47EC039B2B64E8"><enum>(a)</enum><header>In
General</header><text>Section 2110(b) of the <act-name parsable-cite="SSA">Social Security Act</act-name> (42 U.S.C. 1397jj(b)) is
amended—</text>
<paragraph id="IDE9CAF463EC4D49C1BA721FAD9C68E193"><enum>(1)</enum><text>in paragraph
(1)(C), by inserting <quote>, subject to paragraph (5),</quote> after
<quote>under title XIX or</quote>; and</text>
</paragraph><paragraph id="ID5AD1987979254FFD9559FC4667CB2CBC"><enum>(2)</enum><text>by adding at the
end the following new paragraph:</text>
<quoted-block id="IDAE057BA02A9E48BE8EAF1B582D56F2EF" style="OLC">
<paragraph id="ID36E776DD7E3C41B7A4E1E88F7A709F41"><enum>(5)</enum><header>State option to
provide wrap-around coverage</header>
<subparagraph id="ID424B814295F441A4980129D97F3C4ACB"><enum>(A)</enum><header>In
general</header><text>A State may waive the requirement of paragraph (1)(C)
that a targeted low-income child may not be covered under a group health plan
or under health insurance coverage in order to provide—</text>
<clause id="ID5ECFFB21F03A4C3A97B7D39DC87ACD70"><enum>(i)</enum><text>items or services
that are not covered, or are only partially covered, under such plan or
coverage; or</text>
</clause><clause id="ID89EAD83D524B4247A9F96EA033B81743"><enum>(ii)</enum><text>cost-sharing
protection.</text>
</clause></subparagraph><subparagraph id="ID42DE41D3D81A42A8AC4953BD07C17D4E"><enum>(B)</enum><header>Eligibility</header><text>In
waiving such requirement, a State may limit the application of the waiver to
children whose family income does not exceed a level specified by the State, so
long as the level so specified does not exceed the maximum income level
otherwise established for other children under the State child health
plan.</text>
</subparagraph><subparagraph id="ID2B5F47AF3C5547BD8EE76FF727F1FDCD"><enum>(C)</enum><header>Continued
application of duty to prevent substitution of existing
coverage</header><text>Nothing in this paragraph shall be construed as
modifying the application of section 2102(b)(3)(C) to a
State.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="IDD9CD1A420C734D23AA76D98A13E61F59"><enum>(b)</enum><header>Application of
Enhanced Match under Medicaid</header><text>Section 1905 of such Act (42 U.S.C.
1396d) is amended—</text>
<paragraph id="ID9C94A27073CB4578A137F9CBF325E3E5"><enum>(1)</enum><text>in subsection
(b), in the fourth sentence, by striking <quote>subsection (u)(3)</quote> and
inserting <quote>, (u)(3), or (u)(4)</quote>; and</text>
</paragraph><paragraph id="IDEAA128A210804BC4AC356633B98E8B21"><enum>(2)</enum><text>in subsection
(u), by redesignating paragraph (4) as paragraph (5) and by inserting after
paragraph (3) the following:</text>
<quoted-block id="IDC314BE1D76DC46A68B35A2C684D9043B" style="OLC">
<paragraph id="ID2CA525AD4118442283C99F6C001873C9" indent="up1"><enum>(4)</enum><text>For purposes of subsection (b), the
expenditures described in this paragraph are expenditures for items and
services for children described in section
2110(b)(5).</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="ID4B9CEDEA22224148A057FC66DB7EFB85"><enum>(c)</enum><header>Application of
Secondary Payor Provisions</header><text>Section 2107(e)(1) of such Act (42
U.S.C. 1397gg(e)(1)) is amended—</text>
<paragraph id="IDD40818725C20482997F568F72195DFCF"><enum>(1)</enum><text>by redesignating
subparagraphs (B) through (D) as subparagraphs (C) through (E), respectively;
and</text>
</paragraph><paragraph id="ID9A39E84E5E85491181AE3A65336E8371"><enum>(2)</enum><text>by inserting
after subparagraph (A) the following new subparagraph:</text>
<quoted-block id="ID567792EDA54F478AADC7F8818F27331B" style="OLC">
<subparagraph id="ID053F59A6BCA14391B28D643E21B97B01"><enum>(B)</enum><text>Section
1902(a)(25) (relating to coordination of benefits and secondary payor
provisions) with respect to children covered under a waiver described in
section
2110(b)(5).</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection></section><section id="ID3EDCA220C9154E7FB54F0718E286AF27"><enum>202.</enum><header>State option
to enroll low-income children of State employees in SCHIP</header><text display-inline="no-display-inline">Section 2110(b)(2) of the
<act-name parsable-cite="SSA">Social Security Act</act-name> (42 U.S.C.
1397jj(b)(2)) is amended—</text>
<paragraph id="ID2EB7414EB6BB46189C329229533A8121"><enum>(1)</enum><text>by redesignating
subparagraphs (A) and (B) as clauses (i) and (ii), respectively and realigning
the left margins of such clauses appropriately;</text>
</paragraph><paragraph id="IDAFF5B241B8DE450DBF47E9031D225536"><enum>(2)</enum><text>by striking
<quote>Such term</quote> and inserting the following:</text>
<quoted-block id="ID169A2B0360FE4F98BC321A34DF59EFB5" style="OLC">
<subparagraph id="ID8FC746455F9043579C33DE9527B0DB99"><enum>(A)</enum><header>In
general</header><text>Such term</text>
</subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID5A77E496495E41608E7E2E3B73A6CBA3"><enum>(3)</enum><text>by adding at the
end the following:</text>
<quoted-block id="IDA806D1DB94104D59A8B0B9FD6E24C957" style="OLC">
<subparagraph id="IDF217DF839F69416D922BE79E47C85F1C"><enum>(B)</enum><header>State option to
enroll low-income children of state employees</header><text>At the option of a
State, subparagraph (A)(ii) shall not apply to any low-income child who would
otherwise be eligible for child health assistance under this title but for such
subparagraph.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="ID52CE746A669E47F6B04E0CA242D4E906"><enum>203.</enum><header>Optional
coverage of legal immigrant children under Medicaid and SCHIP</header>
<subsection id="IDF55B832CF7524D14A463DD0E4502CA7E"><enum>(a)</enum><header>Medicaid
program</header><text>Section 1903(v) of the <act-name parsable-cite="SSA">Social Security Act</act-name> (42 U.S.C. 1396b(v)) is
amended—</text>
<paragraph id="ID74585A3CB10A43A1A989D26719B3C1AD"><enum>(1)</enum><text>in paragraph (1),
by striking <quote>paragraph (2)</quote> and inserting <quote>paragraphs (2)
and (4)</quote>; and</text>
</paragraph><paragraph id="ID49052FD04F4F4323A85C341A899BF269"><enum>(2)</enum><text>by adding at the
end the following:</text>
<quoted-block id="IDBCB7B90DF62B45319C1773D5C171C281" style="OLC">
<paragraph id="ID20E98F92826B4B07AB96E56E75E02569" indent="up1"><enum>(4)</enum><subparagraph commented="no" display-inline="yes-display-inline" id="IDC6ABD1C0F16C41C0AA0E3E63C50082C2"><enum>(A)</enum><text>A State may elect (in a
plan amendment under this title) to provide medical assistance under this title
for aliens—</text>
<clause id="idB65D65C40C2B46C3A2BD874A87D3C59E" indent="up1"><enum>(i)</enum><text>who are lawfully residing in the
United States (including battered aliens described in section 431(c) of the
Personal Responsibility and Work Opportunity Reconciliation Act of 1996);
and</text>
</clause><clause id="id4ED78D1A4FE244B1A4C2BCA7716F531F" indent="up1"><enum>(ii)</enum><text>who are otherwise eligible for such
assistance, within the eligibility category of children (as defined under such
plan), including optional targeted low-income children described in section
1905(u)(2)(B).</text>
</clause></subparagraph><subparagraph id="ID6B290811E7CD4CC18D9241680487FB6D" indent="up1"><enum>(B)</enum><clause commented="no" display-inline="yes-display-inline" id="IDB5AA5651C802476ABD66E785FE74C22F"><enum>(i)</enum><text>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.</text>
</clause><clause id="ID98EE3059BEEE458F9B67AEEF884410CE" indent="up1"><enum>(ii)</enum><text>The provisions of sections 401(a),
402(b), 403, and 421 of the Personal Responsibility and Work Opportunity
Reconciliation Act of 1996 shall not apply to a State that makes an election
under subparagraph
(A).</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="ID8D5096F2D195495487ECAA586CDAD281"><enum>(b)</enum><header>Title
<enum-in-header>XXI</enum-in-header></header><text>Section 2107(e)(1) of the
<act-name parsable-cite="SSA">Social Security Act</act-name> (42 U.S.C.
1397gg(e)(1)), as amended by section 201(c), is amended redesignating
subparagraph (E) as subparagraph (F) and by inserting after subparagraph (D)
the following:</text>
<quoted-block act-name="Social Security Act" id="IDEA76943CBB1442779BFEFA977A226996" style="OLC">
<subparagraph id="ID3D52EAE04F6C4341B6E1D3B22DCEBBE5"><enum>(E)</enum><text>Section
1903(v)(4) (relating to optional coverage of permanent resident alien
children), but only if the State has elected to apply such section to that
category of children under title
XIX.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="IDE7C44C2175404986A5585FEE97D341B2"><enum>204.</enum><header>State option
for passive renewal of eligibility for children under Medicaid and
SCHIP</header>
<subsection id="ID44F17F763FCD40128CF3067D3DCDD600"><enum>(a)</enum><header>In
General</header><text>Section 1902(l) of the <act-name parsable-cite="SSA">Social Security Act</act-name> (42 U.S.C. 1396a(l)) is
amended by adding at the end the following:</text>
<quoted-block act-name="Social Security Act" id="ID382F7F33D45B456E8671D38650E9A2ED" style="OLC">
<paragraph id="IDAAB0AE31B6964352A4767FC09189D134" indent="up1"><enum>(5)</enum><text>Notwithstanding any other provision
of this title, a State may provide that an individual who has not attained 21
years of age who has been determined eligible for medical assistance under this
title shall remain eligible for medical assistance until such time as the State
has information demonstrating that the individual is no longer so
eligible.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="IDC8E34A5AAD144972B75EE6D4E13AAFE7"><enum>(b)</enum><header>Application
under Title <enum-in-header>XXI</enum-in-header></header><text>Section
2107(e)(1) of the <act-name parsable-cite="SSA">Social Security Act</act-name>
(42 U.S.C. 1397gg(e)), as amended by section 201(c) and 203(b), is
amended—</text>
<paragraph id="ID1ADBC2B7F6794AE398B5654B9A3B3E74"><enum>(1)</enum><text>by redesignating
subparagraphs (C) through (F) as subparagraphs (D) through (G), respectively;
and</text>
</paragraph><paragraph id="ID27B1528D0F3242E4B8050D8285D3FE50"><enum>(2)</enum><text>by inserting
after subparagraph (B), the following:</text>
<quoted-block id="ID8B59DA76B7AD4626A8817F764A2D5B6F" style="OLC">
<subparagraph id="ID374FC0FBDAEB40FD990DE42A8FDDB2FA"><enum>(C)</enum><text>Section
1902(l)(5) (relating to passive renewal of eligibility for
children).</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection></section><enum>III</enum><header>TAX INCENTIVES
FOR HEALTH INSURANCE COVERAGE OF CHILDREN</header>
<section id="IDD5B208A300614E2EAB31F8066C4A3D3B"><enum>301.</enum><header>Refundable
credit for health insurance coverage of children</header>
<subsection id="ID71F6BC0E98BA4558BC5C688F3BA4DC78"><enum>(a)</enum><header>In
General</header><text>Subpart C of part IV of subchapter A of chapter 1 of the
Internal Revenue Code of 1986 (relating to refundable credits) is amended by
redesignating section 36 as section 37 and by inserting after section 35 the
following new section:</text>
<quoted-block id="ID4FF3CD795102413E83B68B8F79C5A6B7" style="OLC">
<section id="ID80E8946FF65F475E908F84A231FF8636"><enum>36.</enum><header>Health
insurance coverage of children</header>
<subsection id="IDAB26B0A5028B43248FD963C33117CFD7"><enum>(a)</enum><header>In
General</header><text>In the case of an individual, there shall be allowed as a
credit against the tax imposed by this subtitle an amount equal to so much of
the amount paid during the taxable year, not compensated for by insurance or
otherwise, for qualified health insurance for each dependent child of the
taxpayer, as exceeds 5 percent of the adjusted gross income of such taxpayer
for such taxable year.</text>
</subsection><subsection id="ID46BC85BD361E4F14825B072ED92B08EB"><enum>(b)</enum><header>Dependent
Child</header><text>For purposes of this section, the term <term>dependent
child</term> means any child (as defined in section 152(f)(1)) who has not
attained the age of 19 as of the close of the calendar year in which the
taxable year of the taxpayer begins and with respect to whom a deduction under
section 151 is allowable to the taxpayer.</text>
</subsection><subsection id="ID8B1DE42E4CA74CD8A79843CF1C21624F"><enum>(c)</enum><header>Qualified
Health Insurance</header><text>For purposes of this section—</text>
<paragraph id="ID9EB0BAC185D443A8840F0806753BE0EB"><enum>(1)</enum><header>In
general</header><text>The term <term>qualified health insurance</term> means
insurance, either employer-provided or made available under title XIX or XXI of
the <act-name parsable-cite="SSA">Social Security Act</act-name>, which
constitutes medical care as defined in section 213(d) without regard to—</text>
<subparagraph id="ID1BAE42488BBC48FFB85C3339B3D57421"><enum>(A)</enum><text>paragraph (1)(C)
thereof, and</text>
</subparagraph><subparagraph id="ID1D2535030AF244E8B041B67B6EA2F8A2"><enum>(B)</enum><text>so much of
paragraph (1)(D) thereof as relates to qualified long-term care insurance
contracts.</text>
</subparagraph></paragraph><paragraph id="ID6BE3536C2E4B41DB930DD0CA095E0A05"><enum>(2)</enum><header>Exclusion of
certain other contracts</header><text>Such term shall not include insurance if
a substantial portion of its benefits are excepted benefits (as defined in
section 9832(c)).</text>
</paragraph></subsection><subsection id="ID7285D520BDA4443AAB430338C6585BC3"><enum>(d)</enum><header>Medical Savings
Account and Health Savings Account Contributions</header>
<paragraph id="ID41703D54481548BF9D9A195E6FD82051"><enum>(1)</enum><header>In
general</header><text>If a deduction would (but for paragraph (2)) be allowed
under section 220 or 223 to the taxpayer for a payment for the taxable year to
the medical savings account or health savings account of an individual,
subsection (a) shall be applied by treating such payment as a payment for
qualified health insurance for such individual.</text>
</paragraph><paragraph id="ID8D0E7015378941C9B1B319E21E95BB72"><enum>(2)</enum><header>Denial of
double benefit</header><text>No deduction shall be allowed under section 220 or
223 for that portion of the payments otherwise allowable as a deduction under
section 220 or 223 for the taxable year which is equal to the amount of credit
allowed for such taxable year by reason of this subsection.</text>
</paragraph></subsection><subsection id="IDACDCB4633D564E2F856CAC0614935FA5"><enum>(e)</enum><header>Special
Rules</header>
<paragraph id="IDFF868021D7D744198DB9D9A0B53D3453"><enum>(1)</enum><header>Determination
of insurance costs</header><text>The Secretary shall provide rules for the
allocation of the cost of any qualified health insurance for family coverage to
the coverage of any dependent child under such insurance.</text>
</paragraph><paragraph id="IDD4D28342FB5948A7A580F9162F920AA6"><enum>(2)</enum><header>Coordination
with deduction for health insurance costs of self-employed
individuals</header><text>In the case of a taxpayer who is eligible to deduct
any amount under section 162(l) for the taxable year, this section shall apply
only if the taxpayer elects not to claim any amount as a deduction under such
section for such year.</text>
</paragraph><paragraph id="ID488EC8C3846D40C18BAC2532AFA2A018"><enum>(3)</enum><header>Coordination
with medical expense and high deductible health plan
deductions</header><text>The amount which would (but for this paragraph) be
taken into account by the taxpayer under section 213 or 223 for the taxable
year shall be reduced by the credit (if any) allowed by this section to the
taxpayer for such year.</text>
</paragraph><paragraph id="IDB6AE4E667992468CBC0D77EE283B8324"><enum>(4)</enum><header>Denial of
credit to dependents</header><text>No credit shall be allowed under this
section to any individual with respect to whom a deduction under section 151 is
allowable to another taxpayer for a taxable year beginning in the calendar year
in which such individual’s taxable year begins.</text>
</paragraph><paragraph id="ID8C7BF8C94AD8450289EF15F114E3FE52"><enum>(5)</enum><header>Denial of
double benefit</header><text>No credit shall be allowed under subsection (a) if
the credit under section 35 is allowed and no credit shall be allowed under 35
if a credit is allowed under this section.</text>
</paragraph><paragraph id="ID5A8D16D137F34FA8AC9E622433694A17"><enum>(6)</enum><header>Election not to
claim credit</header><text>This section shall not apply to a taxpayer for any
taxable year if such taxpayer elects to have this section not apply for such
taxable
year.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID702FF7B53E8148B6932ECCA6D259F69F"><enum>(b)</enum><header>Information
Reporting</header>
<paragraph id="IDA9F2DAE6BE0A4663AF24861B0EB54311"><enum>(1)</enum><header>In
general</header><text>Subpart B of part III of subchapter A of chapter 61 of
the Internal Revenue Code of 1986 (relating to information concerning
transactions with other persons) is amended by inserting after section 6050V
the following new section:</text>
<quoted-block id="ID571CA47E160B4328B40A952114185606" style="OLC">
<section id="IDDE6FE6F19AC14717B679C58043F89F48"><enum>6050W.</enum><header>Returns
relating to payments for qualified health insurance</header>
<subsection id="IDD6C8DE1DFF9E43BAA910A77DCC6FAB40"><enum>(a)</enum><header>In
General</header><text>Any governmental unit or any person who, in connection
with a trade or business conducted by such person, receives payments during any
calendar year from any individual for coverage of a dependent child (as defined
in section 36(b)) of such individual under creditable health insurance, shall
make the return described in subsection (b) (at such time as the Secretary may
by regulations prescribe) with respect to each individual from whom such
payments were received.</text>
</subsection><subsection id="IDB3B06EA5F8934C9284F81294828F91D7"><enum>(b)</enum><header>Form and Manner
of Returns</header><text>A return is described in this subsection if such
return—</text>
<paragraph id="ID120FDEC670DF4B7EAAE225F50AF22784"><enum>(1)</enum><text>is in such form
as the Secretary may prescribe, and</text>
</paragraph><paragraph id="IDF2B57420632F400D9FBF85FB4B2CC403"><enum>(2)</enum><text>contains—</text>
<subparagraph id="IDD1287182358A485D8B12AE3BA6B2E812"><enum>(A)</enum><text>the name,
address, and TIN of the individual from whom payments described in subsection
(a) were received,</text>
</subparagraph><subparagraph id="ID1A5B1627198F4CBB80F398092EBAF8D4"><enum>(B)</enum><text>the name,
address, and TIN of each dependent child (as so defined) who was provided by
such person with coverage under creditable health insurance by reason of such
payments and the period of such coverage, and</text>
</subparagraph><subparagraph id="IDAFDD4142111E49EA8BF323AD9993A4B4"><enum>(C)</enum><text>such other
information as the Secretary may reasonably prescribe.</text>
</subparagraph></paragraph></subsection><subsection id="ID8234E807AD7A4CCEB7631D16961D2758"><enum>(c)</enum><header>Creditable
Health Insurance</header><text>For purposes of this section, the term
<term>creditable health insurance</term> means qualified health insurance (as
defined in section 36(c)).</text>
</subsection><subsection id="ID143A64D1D78E4D54BB9AFA087DEED5BE"><enum>(d)</enum><header>Statements To
Be Furnished to Individuals With Respect to Whom Information Is
Required</header><text>Every person required to make a return under subsection
(a) shall furnish to each individual whose name is required under subsection
(b)(2)(A) to be set forth in such return a written statement showing—</text>
<paragraph id="ID8535D21192CA476F83BCA5BD9D1EF465"><enum>(1)</enum><text>the name and
address of the person required to make such return and the phone number of the
information contact for such person,</text>
</paragraph><paragraph id="IDFB5C5422BA8B4A2F89D8D449A5C34869"><enum>(2)</enum><text>the aggregate
amount of payments described in subsection (a) received by the person required
to make such return from the individual to whom the statement is required to be
furnished, and</text>
</paragraph><paragraph id="IDB13178AA89F74BE69515B7F481B81D62"><enum>(3)</enum><text>the information
required under subsection (b)(2)(B) with respect to such payments.</text>
</paragraph><continuation-text continuation-text-level="subsection">The
written statement required under the preceding sentence shall be furnished on
or before January 31 of the year following the calendar year for which the
return under subsection (a) is required to be made.</continuation-text></subsection><subsection id="ID9622BFB8850944399505F70B63914937"><enum>(e)</enum><header>Returns Which
Would Be Required To Be Made by 2 or More Persons</header><text>Except to the
extent provided in regulations prescribed by the Secretary, in the case of any
amount received by any person on behalf of another person, only the person
first receiving such amount shall be required to make the return under
subsection
(a).</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID518379E00E1D444D9647D4A6523BFFC7"><enum>(2)</enum><header>Assessable
penalties</header>
<subparagraph id="IDBC1CD4BE672949FDAA119BD4CB82EB42"><enum>(A)</enum><text>Subparagraph (B)
of section 6724(d)(1) of such Code (relating to definitions) is amended by
striking <quote>and</quote> at the end of clause (xx) and by inserting at the
end the following new clause:</text>
<quoted-block id="ID05B33409993740D5B28F1FA268C465AD" style="OLC">
<clause id="IDD71E0F568FF041F68158F335DD143471"><enum>(xxi)</enum><text>section 6050W
(relating to returns relating to payments for qualified health insurance),
and</text>
</clause><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="ID3027E1E3E3744D3B84FC4072BB7D431D"><enum>(B)</enum><text>Paragraph (2) of
section 6724(d) of such Code is amended by striking <quote>or</quote> at the
end of the next to last subparagraph, by striking the period at the end of the
last subparagraph and inserting <quote>, or</quote>, and by adding at the end
the following new subparagraph:</text>
<quoted-block id="IDA81529E8802B46B8928B160045BBBA5E" style="OLC">
<subclause id="IDAC130ADA32C1456188EBCED9ED16F181" indent="up2"><enum>(DD)</enum><text>section 6050W(d) (relating to
returns relating to payments for qualified health
insurance).</text>
</subclause><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="ID3F3EB38DE6A74E06932DC8CE81B89BB4"><enum>(3)</enum><header>Clerical
amendment</header><text>The table of sections for subpart B of part III of
subchapter A of chapter 61 of such Code is amended by inserting after the item
relating to section 6050V the following new item:</text>
<quoted-block id="ID73F29BCDEFB748C28107D8D74E5B4167" style="OLC">
<toc regeneration="no-regeneration">
<toc-entry level="section">Sec. 6050W. Returns relating to payments
for qualified health
insurance</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="ID69CFCAE1A4634579BAC62BF347DB470C"><enum>(c)</enum><header>Conforming
Amendments</header>
<paragraph id="ID3A103382E8DB4553AB6BB74533B972D2"><enum>(1)</enum><text>Paragraph (2) of
section 1324(b) of title 31, United States Code, is amended by inserting before
the period <quote>, or from section 36 of such Code</quote>.</text>
</paragraph><paragraph id="ID19C618922E1C4020BAAB0609AF1D8665"><enum>(2)</enum><text>The table of
sections for subpart C of part IV of subchapter A of chapter 1 of the Internal
Revenue Code of 1986 is amended by striking the last item and inserting the
following new items:</text>
<quoted-block id="ID37A91ECEBAB94124A71555CA1169C270" style="OLC">
<toc regeneration="no-regeneration">
<toc-entry level="section">Sec. 36. Health insurance coverage of
children.</toc-entry>
<toc-entry level="section">Sec. 37. Overpayments of
tax</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="ID0F9A0F6B428840B8A22C568335C5164A"><enum>(d)</enum><header>Effective
Date</header><text>The amendments made by this section shall apply to taxable
years beginning after December 31, 2006.</text>
</subsection></section><section id="ID3833683C7605474FA9006EE214B261AE"><enum>302.</enum><header>Forfeiture of
personal exemption for any child not covered by health insurance</header>
<subsection id="ID8D7DA8CA46AA469DB294C0AECABADD5C"><enum>(a)</enum><header>In
General</header><text>Section 151(d) of the Internal Revenue Code of 1986
(relating to exemption amount) is amended by adding at the end the following
new paragraph:</text>
<quoted-block id="ID6F04423D41484E24AB7D32AC1DCFDB2D" style="OLC">
<paragraph id="ID567F887FA97545F882F856228263F980"><enum>(5)</enum><header>Reduction of
exemption amount for any child not covered by health insurance</header>
<subparagraph id="ID53065960D7AD40919FF2A2865151E00A"><enum>(A)</enum><header>In
general</header><text>Except as otherwise provided in this paragraph, the
exemption amount otherwise determined under this subsection for any dependent
child (as defined in section 36(b)) for any taxable year shall be reduced by
the same percentage as the percentage of such taxable year during which such
dependent child was not covered by qualified health insurance (as defined in
section 36(c)).</text>
</subparagraph><subparagraph id="ID697FFEDF3C124620BE6CEFCEDE1C292B"><enum>(B)</enum><header>Full reduction
if no proof of coverage is provided</header><text>For purposes of subparagraph
(A), in the case of any taxpayer who fails to attach to the return of tax for
any taxable year a copy of the statement furnished to such taxpayer under
section 6050W, the percentage reduction under such subparagraph shall be deemed
to be 100 percent.</text>
</subparagraph><subparagraph id="ID004D44CC0CE647AC8D08375FFB997EEC"><enum>(C)</enum><header>Nonapplication
of paragraph to taxpayers in lowest tax bracket</header><text>This paragraph
shall not apply to any taxpayer whose taxable income for the taxable year does
not exceed the initial bracket amount determined under section
1(i)(1)(B).</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID77DF561307E14A029FAD05F065A7EE80"><enum>(b)</enum><header>Effective
Date</header><text>The amendment made by this section shall apply to taxable
years beginning after December 31, 2006.</text>
</subsection></section><enum>IV</enum><header>MISCELLANEOUS</header>
<section id="ID6FA6C095E4F24B09978DA419B65C109F"><enum>401.</enum><header>Requirement
for group market health insurers to offer dependent coverage option for workers
with children</header>
<subsection id="IDBE1D3F17EB1C4D16BF8D39DA2BCD130E"><enum>(a)</enum><header>ERISA</header>
<paragraph id="ID79676631FDFD45DC88169F9E35502E57"><enum>(1)</enum><header>In
general</header><text>Subpart B of part 7 of subtitle B of title I of the
<act-name parsable-cite="ERISA">Employee Retirement Income Security Act of
1974</act-name> (29 U.S.C. 1185 et seq.) is amended by adding at the end the
following:</text>
<quoted-block act-name="Employee Retirement Income Security Act of 1974" id="IDC9820FD6727349D6979F78A31AB42D1B" style="OLC">
<section id="IDC949522F3B804886BB48953B810F2289"><enum>714.</enum><header>Requirement to
offer option to purchase dependent coverage for children</header>
<subsection id="ID77E3BFBEEC3640DF9916486F17676A4A"><enum>(a)</enum><header>Requirements
for Coverage</header><text>A group health plan, and a health insurance issuer
providing health insurance coverage in connection with a group health plan,
shall offer an individual who is enrolled in such coverage the option to
purchase dependent coverage for a child of the individual.</text>
</subsection><subsection id="ID5DBB075180214C47983BBBB7CEA022B5"><enum>(b)</enum><header>No Employer
Contribution Required</header><text>An employer shall not be required to
contribute to the cost of purchasing dependent coverage for a child by an
individual who is an employee of such employer.</text>
</subsection><subsection id="IDD84F9A874869483394DB734ECF10F21F"><enum>(c)</enum><header>Definition of
Child</header><text>In this section, the term <term>child</term> means an
individual who has not attained 21 years of
age.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID9AB3B838DB5A45B1A68FFE5552326767"><enum>(2)</enum><header>Clerical
amendment</header><text>The table of contents in section 1 of the
<act-name parsable-cite="ERISA">Employee Retirement Income Security Act of
1974</act-name> (29 U.S.C. 1001) is amended by inserting after the item
relating to section 713 the following:</text>
<quoted-block act-name="Employee Retirement Income Security Act of 1974" id="ID13F6CEF14F894834A88BEEA4C7804579" style="OLC">
<toc regeneration="no-regeneration">
<toc-entry level="section">Sec. 714. Requirement to offer option to
purchase dependent coverage for
children</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="ID3FC8E5AFFD3A46ADADF24B8CB71325D5"><enum>(b)</enum><header><act-name parsable-cite="PHSA">Public Health Service Act</act-name></header><text>Subpart
2 of part A of title XXVII of the <act-name parsable-cite="PHSA">Public Health
Service Act</act-name> (42 U.S.C. 300gg–4 et seq.) is amended by adding at the
end the following:</text>
<quoted-block act-name="Public Health Service Act" id="ID5E3690F344CA4B838742C5CF79A237C9" style="OLC">
<section id="IDD9B5CB23C1DF40E5BD7F6A1D2C401B01"><enum>2707.</enum><header>Requirement
to offer option to purchase dependent coverage for children</header>
<subsection id="ID02F2A2234CF245B8BD4A0F372C3D621C"><enum>(a)</enum><header>Requirements
for Coverage</header><text>A group health plan, and a health insurance issuer
providing health insurance coverage in connection with a group health plan,
shall offer an individual who is enrolled in such coverage the option to
purchase dependent coverage for a child of the individual.</text>
</subsection><subsection id="ID84F9DB543E514CCEA70E96D2DEDD31F1"><enum>(b)</enum><header>No Employer
Contribution Required</header><text>An employer shall not be required to
contribute to the cost of purchasing dependent coverage for a child by an
individual who is an employee of such employer.</text>
</subsection><subsection id="ID46A2017039464FD881AE1C8DEF5B7568"><enum>(c)</enum><header>Definition of
Child</header><text>In this section, the term <term>child</term> means an
individual who has not attained 21 years of
age.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID4267DBB587294A2D96FB3FEECAC478B3"><enum>(c)</enum><header>Effective
Date</header><text>The amendments made by this section shall apply with respect
to plan years beginning on or after January 1, 2007.</text>
</subsection></section><section id="ID3C18B4BAFC9040DC81F089BA06CA9A9E"><enum>402.</enum><header>Effective
date</header><text display-inline="no-display-inline">Unless otherwise
provided, the amendments made by this title 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.</text>
</section><enum>V</enum><header>REVENUE
PROVISION</header>
<section id="IDD9976B0FF36F4B9196E21C11B31642C1"><enum>501.</enum><header>Partial repeal
of rate reduction in the highest income tax bracket</header><text display-inline="no-display-inline">Section 1(i)(2) of the Internal Revenue Code
of 1986 is amended by adding at the end the following flush sentence:</text>
<paragraph id="LEXA-Repairid4EE392E5CDB7451A8E0C0F80E454496E"><enum></enum><continuation-text continuation-text-level="paragraph" indent="clause">“In the case of taxable years beginning during calendar
year 2007 and thereafter, the final item in the fourth column in the preceding
table shall be applied by substituting for <quote>35.0%</quote> a rate equal to
the lesser of 39.6% or the rate the Secretary determines is necessary to
provide sufficient revenues to offset the Federal outlays required to implement
the provisions of, and amendments made by, the Kids Come First Act of
2007.”.</continuation-text></paragraph></section>