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HR 3162 EPCS

H Calendar No. 338

110th CONGRESS

1st Session

H. R. 3162

IN THE SENATE OF THE UNITED STATES

September 4, 2007

Received; read twice and placed on the calendar


AN ACT

To amend titles XVIII, XIX, and XXI of the Social Security Act to extend and improve the children's health insurance program, to improve beneficiary protections under the Medicare, Medicaid, and the CHIP 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; TABLE OF CONTENTS.

    (a) Short Title- This Act may be cited as the `Children's Health and Medicare Protection Act of 2007'.

    (b) Table of Contents- The table of contents of this Act is as follows:

      Sec. 1. Short title; table of contents.

TITLE I--CHILDREN'S HEALTH INSURANCE PROGRAM

      Sec. 100. Purpose.

Subtitle A--Funding

      Sec. 101. Establishment of new base CHIP allotments.

      Sec. 102. 2-year initial availability of CHIP allotments.

      Sec. 103. Redistribution of unused allotments to address State funding shortfalls.

      Sec. 104. Extension of option for qualifying States.

Subtitle B--Improving Enrollment and Retention of Eligible Children

      Sec. 111. CHIP performance bonus payment to offset additional enrollment costs resulting from enrollment and retention efforts.

      Sec. 112. State option to rely on findings from an express lane agency to conduct simplified eligibility determinations.

      Sec. 113. Application of medicaid outreach procedures to all children and pregnant women.

      Sec. 114. Encouraging culturally appropriate enrollment and retention practices.

      Sec. 115. Continuous coverage under CHIP.

Subtitle C--Coverage

      Sec. 121. Ensuring child-centered coverage.

      Sec. 122. Improving benchmark coverage options.

      Sec. 123. Premium grace period.

Subtitle D--Populations

      Sec. 131. Optional coverage of children up to age 21 under CHIP.

      Sec. 132. Optional coverage of legal immigrants under the Medicaid program and CHIP.

      Sec. 133. State option to expand or add coverage of certain pregnant women under CHIP.

      Sec. 134. Limitation on waiver authority to cover adults.

      Sec. 135. No Federal funding for illegal aliens.

      Sec. 136. Auditing requirement to enforce citizenship restrictions on eligibility for Medicaid and CHIP benefits.

Subtitle E--Access

      Sec. 141. Children's Access, Payment, and Equality Commission.

      Sec. 142. Model of Interstate coordinated enrollment and coverage process.

      Sec. 143. Medicaid citizenship documentation requirements.

      Sec. 144. Access to dental care for children.

      Sec. 145. Prohibiting initiation of new health opportunity account demonstration programs.

Subtitle F--Quality and Program Integrity

      Sec. 151. Pediatric health quality measurement program.

      Sec. 152. Application of certain managed care quality safeguards to CHIP.

      Sec. 153. Updated Federal evaluation of CHIP.

      Sec. 154. Access to records for IG and GAO audits and evaluations.

      Sec. 155. References to title XXI.

      Sec. 156. Reliance on law; exception for State legislation.

TITLE II--MEDICARE BENEFICIARY IMPROVEMENTS

Subtitle A--Improvements in Benefits

      Sec. 201. Coverage and waiver of cost-sharing for preventive services.

      Sec. 202. Waiver of deductible for colorectal cancer screening tests regardless of coding, subsequent diagnosis, or ancillary tissue removal.

      Sec. 203. Parity for mental health coinsurance.

Subtitle B--Improving, Clarifying, and Simplifying Financial Assistance for Low Income Medicare Beneficiaries

      Sec. 211. Improving assets tests for Medicare Savings Program and low-income subsidy program.

      Sec. 212. Making QI program permanent and expanding eligibility.

      Sec. 213. Eliminating barriers to enrollment.

      Sec. 214. Eliminating application of estate recovery.

      Sec. 215. Elimination of part D cost-sharing for certain non-institutionalized full-benefit dual eligible individuals.

      Sec. 216. Exemptions from income and resources for determination of eligibility for low-income subsidy.

      Sec. 217. Cost-sharing protections for low-income subsidy-eligible individuals.

      Sec. 218. Intelligent assignment in enrollment.

Subtitle C--Part D Beneficiary Improvements

      Sec. 221. Including costs incurred by AIDS drug assistance programs and Indian Health Service in providing prescription drugs toward the annual out of pocket threshold under Part D.

      Sec. 222. Permitting mid-year changes in enrollment for formulary changes adversely impact an enrollee.

      Sec. 223. Removal of exclusion of benzodiazepines from required coverage under the Medicare prescription drug program.

      Sec. 224. Permitting updating drug compendia under part D using part B update process.

      Sec. 225. Codification of special protections for six protected drug classifications.

      Sec. 226. Elimination of Medicare part D late enrollment penalties paid by low-income subsidy-eligible individuals.

      Sec. 227. Special enrollment period for subsidy eligible individuals.

Subtitle D--Reducing Health Disparities

      Sec. 231. Medicare data on race, ethnicity, and primary language.

      Sec. 232. Ensuring effective communication in Medicare.

      Sec. 233. Demonstration to promote access for Medicare beneficiaries with limited English proficiency by providing reimbursement for culturally and linguistically appropriate services.

      Sec. 234. Demonstration to improve care to previously uninsured.

      Sec. 235. Office of the Inspector General report on compliance with and enforcement of national standards on culturally and linguistically appropriate services (CLAS) in medicare.

      Sec. 236. IOM report on impact of language access services.

      Sec. 237. Definitions.

TITLE III--PHYSICIANS' SERVICE PAYMENT REFORM

      Sec. 301. Establishment of separate target growth rates for service categories.

      Sec. 302. Improving accuracy of relative values under the Medicare physician fee schedule.

      Sec. 303. Feedback mechanism on practice patterns.

      Sec. 304. Payments for efficient areas.

      Sec. 305. Recommendations on refining the physician fee schedule.

      Sec. 306. Improved and expanded medical home demonstration project.

      Sec. 307. Repeal of Physician Assistance and Quality Initiative Fund.

      Sec. 308. Adjustment to Medicare payment localities.

      Sec. 309. Payment for imaging services.

      Sec. 310. Reducing frequency of meetings of the Practicing Physicians Advisory Council.

TITLE IV--MEDICARE ADVANTAGE REFORMS

Subtitle A--Payment Reform

      Sec. 401. Equalizing payments between Medicare Advantage plans and fee-for-service Medicare.

Subtitle B--Beneficiary Protections

      Sec. 411. NAIC development of marketing, advertising, and related protections.

      Sec. 412. Limitation on out-of-pocket costs for individual health services.

      Sec. 413. MA plan enrollment modifications.

      Sec. 414. Information for beneficiaries on MA plan administrative costs.

Subtitle C--Quality and Other Provisions

      Sec. 421. Requiring all MA plans to meet equal standards.

      Sec. 422. Development of new quality reporting measures on racial disparities.

      Sec. 423. Strengthening audit authority.

      Sec. 424. Improving risk adjustment for MA payments.

      Sec. 425. Eliminating special treatment of private fee-for-service plans.

      Sec. 426. Renaming of Medicare Advantage program.

Subtitle D--Extension of Authorities

      Sec. 431. Extension and revision of authority for special needs plans (SNPs).

      Sec. 432. Extension and revision of authority for Medicare reasonable cost contracts.

TITLE V--PROVISIONS RELATING TO MEDICARE PART A

      Sec. 501. Inpatient hospital payment updates.

      Sec. 502. Payment for inpatient rehabilitation facility (IRF) services.

      Sec. 503. Long-term care hospitals.

      Sec. 504. Increasing the DSH adjustment cap.

      Sec. 505. PPS-exempt cancer hospitals.

      Sec. 506. Skilled nursing facility payment update.

      Sec. 507. Revocation of unique deeming authority of the Joint Commission for the Accreditation of Healthcare Organizations.

      Sec. 508. Treatment of Medicare hospital reclassifications.

      Sec. 509. Medicare critical access hospital designations.

TITLE VI--OTHER PROVISIONS RELATING TO MEDICARE PART B

Subtitle A--Payment and Coverage Improvements

      Sec. 601. Payment for therapy services.

      Sec. 602. Medicare separate definition of outpatient speech-language pathology services.

      Sec. 603. Increased reimbursement rate for certified nurse-midwives.

      Sec. 604. Adjustment in outpatient hospital fee schedule increase factor.

      Sec. 605. Exception to 60-day limit on Medicare substitute billing arrangements in case of physicians ordered to active duty in the Armed Forces.

      Sec. 606. Excluding clinical social worker services from coverage under the medicare skilled nursing facility prospective payment system and consolidated payment.

      Sec. 607. Coverage of marriage and family therapist services and mental health counselor services.

      Sec. 608. Rental and purchase of power-driven wheelchairs.

      Sec. 609. Rental and purchase of oxygen equipment.

      Sec. 610. Adjustment for Medicare mental health services.

      Sec. 611. Extension of brachytherapy special rule.

      Sec. 612. Payment for part B drugs.

Subtitle B--Extension of Medicare Rural Access Protections

      Sec. 621. 2-year extension of floor on medicare work geographic adjustment.

      Sec. 622. 2-year extension of special treatment of certain physician pathology services under Medicare.

      Sec. 623. 2-year extension of medicare reasonable costs payments for certain clinical diagnostic laboratory tests furnished to hospital patients in certain rural areas.

      Sec. 624. 2-year extension of Medicare incentive payment program for physician scarcity areas.

      Sec. 625. 2-year extension of medicare increase payments for ground ambulance services in rural areas.

      Sec. 626. Extending hold harmless for small rural hospitals under the HOPD prospective payment system.

Subtitle C--End Stage Renal Disease Program

      Sec. 631. Chronic kidney disease demonstration projects.

      Sec. 632. Medicare coverage of kidney disease patient education services.

      Sec. 633. Required training for patient care dialysis technicians.

      Sec. 634. MedPAC report on treatment modalities for patients with kidney failure.

      Sec. 635. Adjustment for erythropoietin stimulating agents (ESAs).

      Sec. 636. Site neutral composite rate.

      Sec. 637. Development of ESRD bundling system and quality incentive payments.

      Sec. 638. MedPAC report on ESRD bundling system.

      Sec. 639. OIG study and report on erythropoietin.

Subtitle D--Miscellaneous

      Sec. 651. Limitation on exception to the prohibition on certain physician referrals for hospitals.

TITLE VII--PROVISIONS RELATING TO MEDICARE PARTS A AND B

      Sec. 701. Home health payment update for 2008.

      Sec. 702. 2-year extension of temporary Medicare payment increase for home health services furnished in a rural area.

      Sec. 703. Extension of Medicare secondary payer for beneficiaries with end stage renal disease for large group plans.

      Sec. 704. Plan for Medicare payment adjustments for never events.

      Sec. 705. Reinstatement of residency slots.

      Sec. 706. Studies relating to home health.

      Sec. 707. Rural home health quality demonstration projects.

TITLE VIII--MEDICAID

Subtitle A--Protecting Existing Coverage

      Sec. 801. Modernizing transitional Medicaid.

      Sec. 802. Family planning services.

      Sec. 803. Authority to continue providing adult day health services approved under a State Medicaid plan.

      Sec. 804. State option to protect community spouses of individuals with disabilities.

      Sec. 805. County medicaid health insuring organizatios.

Subtitle B--Payments

      Sec. 811. Payments for Puerto Rico and territories.

      Sec. 812. Medicaid drug rebate.

      Sec. 813. Adjustment in computation of Medicaid FMAP to disregard an extraordinary employer pension contribution.

      Sec. 814. Moratorium on certain payment restrictions.

      Sec. 815. Tennessee DSH.

      Sec. 816. Clarification treatment of regional medical center.

      Sec. 817. Extension of SSI web-based asset demonstration project to the Medicaid program.

Subtitle C--Miscellaneous

      Sec. 821. Demonstration project for employer buy-in.

      Sec. 822. Diabetes grants.

      Sec. 823. Technical correction.

TITLE IX--MISCELLANEOUS

      Sec. 901. Medicare Payment Advisory Commission status.

      Sec. 902. Repeal of trigger provision.

      Sec. 903. Repeal of comparative cost adjustment (CCA) program.

      Sec. 904. Comparative effectiveness research.

      Sec. 905. Implementation of Health information technology (IT) under Medicare.

      Sec. 906. Development, reporting, and use of health care measures.

      Sec. 907. Improvements to the Medigap program.

      Sec. 908. Implementation funding.

      Sec. 909. Access to data on prescription drug plans and medicare advantage plans.

      Sec. 910. Abstinence education.

TITLE X--REVENUES

      Sec. 1001. Increase in rate of excise taxes on tobacco products and cigarette papers and tubes.

      Sec. 1002. Exemption for emergency medical services transportation.

TITLE I--CHILDREN'S HEALTH INSURANCE PROGRAM

SEC. 100. PURPOSE.

    It is the purpose of this title to provide dependable and stable funding for children's health insurance under titles XXI and XIX of the Social Security Act in order to enroll all six million uninsured children who are eligible, but not enrolled, for coverage today through such titles.

Subtitle A--Funding

SEC. 101. ESTABLISHMENT OF NEW BASE CHIP ALLOTMENTS.

    Section 2104 of the Social Security Act (42 U.S.C. 1397dd) is amended--

      (1) in subsection (a)--

        (A) in paragraph (9), by striking `and' at the end;

        (B) in paragraph (10), by striking the period at the end and inserting `; and'; and

        (C) by adding at the end the following new paragraph:

      `(11) for fiscal year 2008 and each succeeding fiscal year, the sum of the State allotments provided under subsection (i) for such fiscal year.'; and

      (2) in subsections (b)(1) and (c)(1), by striking `subsection (d)' and inserting `subsections (d) and (i)'; and

      (3) by adding at the end the following new subsection:

    `(i) Allotments for States and Territories Beginning With Fiscal Year 2008-

      `(1) GENERAL ALLOTMENT COMPUTATION- Subject to the succeeding provisions of this subsection, the Secretary shall compute a State allotment for each State for each fiscal year as follows:

        `(A) FOR FISCAL YEAR 2008- For fiscal year 2008, the allotment of a State is equal to the greater of--

          `(i) the State projection (in its submission on forms CMS--21B and CMS--37 for May 2007) of Federal payments to the State under this title for such fiscal year, except that, in the case of a State that has enacted legislation to modify its State child health plan during 2007, the State may substitute its projection in its submission on forms CMS--21B and CMS--37 for August 2007, instead of such forms for May 2007; or

          `(ii) the allotment of the State under this section for fiscal year 2007 multiplied by the allotment increase factor under paragraph (2) for fiscal year 2008.

        `(B) INFLATION UPDATE FOR FISCAL YEAR 2009 AND EACH SECOND SUCCEEDING FISCAL YEAR- For fiscal year 2009 and each second succeeding fiscal year, the allotment of a State is equal to the amount of the State allotment under this paragraph for the previous fiscal year multiplied by the allotment increase factor under paragraph (2) for the fiscal year involved.

        `(C) REBASING IN FISCAL YEAR 2010 AND EACH SECOND SUCCEEDING FISCAL YEAR- For fiscal year 2010 and each second succeeding fiscal year, the allotment of a State is equal to the Federal payments to the State that are attributable to (and countable towards) the total amount of allotments available under this section to the State (including allotments made available under paragraph (3) as well as amounts redistributed to the State) in the previous fiscal year multiplied by the allotment increase factor under paragraph (2) for the fiscal year involved.

        `(D) SPECIAL RULES FOR TERRITORIES- Notwithstanding the previous subparagraphs, the allotment for a State that is not one of the 50 States or the District of Columbia for fiscal year 2008 and for a succeeding fiscal year is equal to the Federal payments provided to the State under this title for the previous fiscal year multiplied by the allotment increase factor under paragraph (2) for the fiscal year involved (but determined by applying under paragraph (2)(B) as if the reference to `in the State' were a reference to `in the United States').

      `(2) ALLOTMENT INCREASE FACTOR- The allotment increase factor under this paragraph for a fiscal year is equal to the product of the following:

        `(A) PER CAPITA HEALTH CARE GROWTH FACTOR- 1 plus the percentage increase in the projected per capita amount of National Health Expenditures from the calendar year in which the previous fiscal year ends to the calendar year in which the fiscal year involved ends, as most recently published by the Secretary before the beginning of the fiscal year.

        `(B) CHILD POPULATION GROWTH FACTOR- 1 plus the percentage increase (if any) in the population of children under 19 years of age in the State from July 1 in the previous fiscal year to July 1 in 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, plus 1 percentage point.

      `(3) PERFORMANCE-BASED SHORTFALL ADJUSTMENT-

        `(A) IN GENERAL- If a State's expenditures under this title in a fiscal year (beginning with fiscal year 2008) exceed the total amount of allotments available under this section to the State in the fiscal year (determined without regard to any redistribution it receives under subsection (f) that is available for expenditure during such fiscal year, but including any carryover from a previous fiscal year) and if the average monthly unduplicated number of children enrolled under the State plan under this title (including children receiving health care coverage through funds under this title pursuant to a waiver under section 1115) during such fiscal year exceeds its target average number of such enrollees (as determined under subparagraph (B)) for that fiscal year, the allotment under this section for the State for the subsequent fiscal year (or, pursuant to subparagraph (F), for the fiscal year involved) shall be increased by the product of--

          `(i) the amount by which such average monthly caseload exceeds such target number of enrollees; and

          `(ii) the projected per capita expenditures under the State child health plan (as determined under subparagraph (C) for the original fiscal year involved), multiplied by the enhanced FMAP (as defined in section 2105(b)) for the State and fiscal year involved.

        `(B) TARGET AVERAGE NUMBER OF CHILD ENROLLEES- In this subsection, the target average number of child enrollees for a State--

          `(i) for fiscal year 2008 is equal to the monthly average unduplicated number of children enrolled in the State child health plan under this title (including such children receiving health care coverage through funds under this title pursuant to a waiver under section 1115) during fiscal year 2007 increased by the population growth for children in that State for the year ending on June 30, 2006 (as estimated by the Bureau of the Census) plus 1 percentage point; or

          `(ii) for a subsequent fiscal year is equal to the target average number of child enrollees for the State for the previous fiscal year increased by the population growth for children in that State for the year ending on June 30 before the beginning of the fiscal year (as estimated by the Bureau of the Census) plus 1 percentage point.

        `(C) PROJECTED PER CAPITA EXPENDITURES- For purposes of subparagraph (A)(ii), the projected per capita expenditures under a State child health plan--

          `(i) for fiscal year 2008 is equal to the average per capita expenditures (including both State and Federal financial participation) under such plan for the targeted low-income children counted in the average monthly caseload for purposes of this paragraph during fiscal year 2007, increased by the annual percentage increase in the per capita amount of National Health Expenditures (as estimated by the Secretary) for 2008; or

          `(ii) for a subsequent fiscal year is equal to the projected per capita expenditures under such plan for the previous fiscal year (as determined under clause (i) or this clause) increased by the annual percentage increase in the per capita amount of National Health Expenditures (as estimated by the Secretary) for the year in which such subsequent fiscal year ends.

        `(D) AVAILABILITY- Notwithstanding subsection (e), an increase in allotment under this paragraph shall only be available for expenditure during the fiscal year in which it is provided.

        `(E) NO REDISTRIBUTION OF PERFORMANCE-BASED SHORTFALL ADJUSTMENT- In no case shall any increase in allotment under this paragraph for a State be subject to redistribution to other States.

        `(F) INTERIM ALLOTMENT ADJUSTMENT- The Secretary shall develop a process to administer the performance-based shortfall adjustment in a manner so it is applied to (and before the end of) the fiscal year (rather than the subsequent fiscal year) involved for a State that the Secretary estimates will be in shortfall and will exceed its enrollment target for that fiscal year.

        `(G) PERIODIC AUDITING- The Comptroller General of the United States shall periodically audit the accuracy of data used in the computation of allotment adjustments under this paragraph. Based on such audits, the Comptroller General shall make such recommendations to the Congress and the Secretary as the Comptroller General deems appropriate.

      `(4) CONTINUED REPORTING- For purposes of paragraph (3) and subsection (f), the State shall submit to the Secretary the State's projected Federal expenditures, even if the amount of such expenditures exceeds the total amount of allotments available to the State in such fiscal year.'.

SEC. 102. 2-YEAR INITIAL AVAILABILITY OF CHIP ALLOTMENTS.

    Section 2104(e) of the Social Security Act (42 U.S.C. 1397dd(e)) is amended to read as follows:

    `(e) Availability of Amounts Allotted-

      `(1) IN GENERAL- Except as provided in paragraph (2) and subsection (i)(3)(D), amounts allotted to a State pursuant to this section--

        `(A) for each of fiscal years 1998 through 2007, shall remain available for expenditure by the State through the end of the second succeeding fiscal year; and

        `(B) for fiscal year 2008 and each fiscal year thereafter, shall remain available for expenditure by the State through the end of the succeeding fiscal year.

      `(2) AVAILABILITY OF AMOUNTS REDISTRIBUTED- Amounts redistributed to a State under subsection (f) shall be available for expenditure by the State through the end of the fiscal year in which they are redistributed, except that funds so redistributed to a State that are not expended by the end of such fiscal year shall remain available after the end of such fiscal year and shall be available in the following fiscal year for subsequent redistribution under such subsection.'.

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

    Section 2104(f) of the Social Security Act (42 U.S.C. 1397dd(f)) is amended--

      (1) by striking `The Secretary' and inserting the following:

      `(1) IN GENERAL- The Secretary';

      (2) by striking `States that have fully expended the amount of their allotments under this section.' and inserting `States that the Secretary determines with respect to the fiscal year for which unused allotments are available for redistribution under this subsection, are shortfall States described in paragraph (2) for such fiscal year, but not to exceed the amount of the shortfall described in paragraph (2)(A) for each such State (as may be adjusted under paragraph (2)(C)). The amount of allotments not expended or redistributed under the previous sentence shall remain available for redistribution in the succeeding fiscal year.'; and

      (3) by adding at the end the following new paragraph:

      `(2) SHORTFALL STATES DESCRIBED-

        `(A) IN GENERAL- For purposes of paragraph (1), with respect to a fiscal year, a shortfall State described in this subparagraph is a State with a State child health plan approved under this title for which the Secretary estimates on the basis of the most recent data available to the Secretary, that the projected expenditures under such plan for the State for the fiscal year will exceed the sum of--

          `(i) the amount of the State's allotments for any preceding fiscal years that remains available for expenditure and that will not be expended by the end of the immediately preceding fiscal year;

          `(ii) the amount (if any) of the performance based adjustment under subsection (i)(3)(A); and

          `(iii) the amount of the State's allotment for the fiscal year.

        `(B) PRORATION RULE- If the amounts available for redistribution under paragraph (1) for a fiscal year are less than the total amounts of the estimated shortfalls determined for the year under subparagraph (A), the amount to be redistributed under such paragraph for each shortfall State shall be reduced proportionally.

        `(C) RETROSPECTIVE ADJUSTMENT- The Secretary may adjust the estimates and determinations made under paragraph (1) and this paragraph with respect to a fiscal year as necessary on the basis of the amounts reported by States not later than November 30 of the succeeding fiscal year, as approved by the Secretary.'.

SEC. 104. EXTENSION OF OPTION FOR QUALIFYING STATES.

    Section 2105(g)(1)(A) of the Social Security Act (42 U.S.C. 1397ee(g)(1)(A)) is amended by inserting after `or 2007' the following: `or 100 percent of any allotment under section 2104 for any subsequent fiscal year'.

Subtitle B--Improving Enrollment and Retention of Eligible Children

SEC. 111. CHIP PERFORMANCE BONUS PAYMENT TO OFFSET ADDITIONAL ENROLLMENT COSTS RESULTING FROM ENROLLMENT AND RETENTION EFFORTS.

    (a) In General- Section 2105(a) of the Social Security Act (42 U.S.C. 1397ee(a)) is amended by adding at the end the following new paragraphs:

      `(3) PERFORMANCE BONUS PAYMENT TO OFFSET ADDITIONAL MEDICAID AND CHIP CHILD ENROLLMENT COSTS RESULTING FROM ENROLLMENT AND RETENTION EFFORTS-

        `(A) IN GENERAL- In addition to the payments made under paragraph (1), for each fiscal year (beginning with fiscal year 2008 and ending with fiscal year 2013) the Secretary shall pay to each State that meets the condition under paragraph (4) for the fiscal year, an amount equal to the amount described in subparagraph (B) for the State and fiscal year. The payment under this paragraph shall be made, to a State for a fiscal year, as a single payment not later than the last day of the first calendar quarter of the following fiscal year.

        `(B) AMOUNT- The amount described in this subparagraph for a State for a fiscal year is equal to the sum of the following amounts:

          `(i) FOR ABOVE BASELINE MEDICAID CHILD ENROLLMENT COSTS-

            `(I) FIRST TIER ABOVE BASELINE MEDICAID ENROLLEES- An amount equal to the number of first tier above baseline child enrollees (as determined under subparagraph (C)(i)) under title XIX for the State and fiscal year multiplied by 35 percent of the projected per capita State Medicaid expenditures (as determined under subparagraph (D)(i)) for the State and fiscal year under title XIX.

            `(II) SECOND TIER ABOVE BASELINE MEDICAID ENROLLEES- An amount equal to the number of second tier above baseline child enrollees (as determined under subparagraph (C)(ii)) under title XIX for the State and fiscal year multiplied by 90 percent of the projected per capita State Medicaid expenditures (as determined under subparagraph (D)(i)) for the State and fiscal year under title XIX.

          `(ii) FOR ABOVE BASELINE CHIP ENROLLMENT COSTS-

            `(I) FIRST TIER ABOVE BASELINE CHIP ENROLLEES- An amount equal to the number of first tier above baseline child enrollees under this title (as determined under subparagraph (C)(i)) for the State and fiscal year multiplied by 5 percent of the projected per capita State CHIP expenditures (as determined under subparagraph (D)(ii)) for the State and fiscal year under this title.

            `(II) SECOND TIER ABOVE BASELINE CHIP ENROLLEES- An amount equal to the number of second tier above baseline child enrollees under this title (as determined under subparagraph (C)(ii)) for the State and fiscal year multiplied by 75 percent of the projected per capita State CHIP expenditures (as determined under subparagraph (D)(ii)) for the State and fiscal year under this title.

        `(C) NUMBER OF FIRST AND SECOND TIER ABOVE BASELINE CHILD ENROLLEES; BASELINE NUMBER OF CHILD ENROLLEES- For purposes of this paragraph:

          `(i) FIRST TIER ABOVE BASELINE CHILD ENROLLEES- The number of first tier above baseline child enrollees for a State for a fiscal year under this title or title XIX is equal to the number (if any, as determined by the Secretary) by which--

            `(I) the monthly average unduplicated number of qualifying children (as defined in subparagraph (E)) enrolled during the fiscal year under the State child health plan under this title or under the State plan under title XIX, respectively; exceeds

            `(II) the baseline number of enrollees described in clause (iii) for the State and fiscal year under this title or title XIX, respectively;

          but not to exceed 3 percent (in the case of title XIX) or 7.5 percent (in the case of this title) of the baseline number of enrollees described in subclause (II).

          `(ii) SECOND TIER ABOVE BASELINE CHILD ENROLLEES- The number of second tier above baseline child enrollees for a State for a fiscal year under this title or title XIX is equal to the number (if any, as determined by the Secretary) by which--

            `(I) the monthly average unduplicated number of qualifying children (as defined in subparagraph (E)) enrolled during the fiscal year under this title or under title XIX, respectively, as described in clause (i)(I); exceeds

            `(II) the sum of the baseline number of child enrollees described in clause (iii) for the State and fiscal year under this title or title XIX, respectively, as described in clause (i)(II), and the maximum number of first tier above baseline child enrollees for the State and fiscal year under this title or title XIX, respectively, as determined under clause (i).

          `(iii) BASELINE NUMBER OF CHILD ENROLLEES- The baseline number of child enrollees for a State under this title or title XIX--

            `(I) for fiscal year 2008 is equal to the monthly average unduplicated number of qualifying children enrolled in the State child health plan under this title or in the State plan under title XIX, respectively, during fiscal year 2007 increased by the population growth for children in that State for the year ending on June 30, 2006 (as estimated by the Bureau of the Census) plus 1 percentage point; or

            `(II) for a subsequent fiscal year is equal to the baseline number of child enrollees for the State for the previous fiscal year under this title or title XIX, respectively, increased by the population growth for children in that State for the year ending on June 30 before the beginning of the fiscal year (as estimated by the Bureau of the Census) plus 1 percentage point.

        `(D) PROJECTED PER CAPITA STATE EXPENDITURES- For purposes of subparagraph (B)--

          `(i) PROJECTED PER CAPITA STATE MEDICAID EXPENDITURES- The projected per capita State Medicaid expenditures for a State and fiscal year under title XIX is equal to the average per capita expenditures (including both State and Federal financial participation) for children under the State plan under such title, including under waivers but not including such children eligible for assistance by virtue of the receipt of benefits under title XVI, for the most recent fiscal year for which actual data are available (as determined by the Secretary), increased (for each subsequent fiscal year up to and including the fiscal year involved) by the annual percentage increase in per capita amount of National Health Expenditures (as estimated by the Secretary) for the calendar year in which the respective subsequent fiscal year ends and multiplied by a State matching percentage equal to 100 percent minus the Federal medical assistance percentage (as defined in section 1905(b)) for the fiscal year involved.

          `(ii) PROJECTED PER CAPITA STATE CHIP EXPENDITURES- The projected per capita State CHIP expenditures for a State and fiscal year under this title is equal to the average per capita expenditures (including both State and Federal financial participation) for children under the State child health plan under this title, including under waivers, for the most recent fiscal year for which actual data are available (as determined by the Secretary), increased (for each subsequent fiscal year up to and including the fiscal year involved) by the annual percentage increase in per capita amount of National Health Expenditures (as estimated by the Secretary) for the calendar year in which the respective subsequent fiscal year ends and multiplied by a State matching percentage equal to 100 percent minus the enhanced FMAP (as defined in section 2105(b)) for the fiscal year involved.

        `(E) QUALIFYING CHILDREN DEFINED- For purposes of this subsection, the term `qualifying children' means, with respect to this title or title XIX, children who meet the eligibility criteria (including income, categorical eligibility, age, and immigration status criteria) in effect as of July 1, 2007, for enrollment under this title or title XIX, respectively, taking into account criteria applied as of such date under this title or title XIX, respectively, pursuant to a waiver under section 1115.

      `(4) ENROLLMENT AND RETENTION PROVISIONS FOR CHILDREN- For purposes of paragraph (3)(A), a State meets the condition of this paragraph for a fiscal year if it is implementing at least 4 of the following enrollment and retention provisions (treating each subparagraph as a separate enrollment and retention provision) throughout the entire fiscal year:

        `(A) CONTINUOUS ELIGIBILITY- The State has elected the option of continuous eligibility for a full 12 months for all children described in section 1902(e)(12) under title XIX under 19 years of age, as well as applying such policy under its State child health plan under this title.

        `(B) LIBERALIZATION OF ASSET REQUIREMENTS- The State meets the requirement specified in either of the following clauses:

          `(i) ELIMINATION OF ASSET TEST- The State does not apply any asset or resource test for eligibility for children under title XIX or this title.

          `(ii) ADMINISTRATIVE VERIFICATION OF ASSETS- The State--

            `(I) permits a parent or caretaker relative who is applying on behalf of a child for medical assistance under title XIX or child health assistance under this title to declare and certify by signature under penalty of perjury information relating to family assets for purposes of determining and redetermining financial eligibility; and

            `(II) takes steps to verify assets through means other than by requiring documentation from parents and applicants except in individual cases of discrepancies or where otherwise justified.

        `(C) ELIMINATION OF IN-PERSON INTERVIEW REQUIREMENT- The State does not require an application of a child for medical assistance under title XIX (or for child health assistance under this title), including an application for renewal of such assistance, to be made in person nor does the State require a face-to-face interview, unless there are discrepancies or individual circumstances justifying an in-person application or face-to-face interview.

        `(D) USE OF JOINT APPLICATION FOR MEDICAID AND CHIP- The application form 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.

        `(E) AUTOMATIC RENEWAL (USE OF ADMINISTRATIVE RENEWAL)-

          `(i) IN GENERAL- The State provides, in the case of renewal of a child's eligibility for medical assistance under title XIX or child health assistance under this title, a pre-printed form completed by the State based on the information available to the State and notice to the parent or caretaker relative of the child that eligibility of the child will be renewed and continued based on such information unless the State is provided other information. Nothing in this clause shall be construed as preventing a State from verifying, through electronic and other means, the information so provided.

          `(ii) SATISFACTION THROUGH DEMONSTRATED USE OF EX PARTE PROCESS- A State shall be treated as satisfying the requirement of clause (i) if renewal of eligibility of children under title XIX or this title is determined without any requirement for an in-person interview, unless sufficient information is not in the State's possession and cannot be acquired from other sources (including other State agencies) without the participation of the applicant or the applicant's parent or caretaker relative.

        `(F) PRESUMPTIVE ELIGIBILITY FOR CHILDREN- The State is implementing section 1920A under title XIX as well as, pursuant to section 2107(e)(1), under this title.

        `(G) EXPRESS LANE- The State is implementing the option described in section 1902(e)(13) under title XIX as well as, pursuant to section 2107(e)(1), under this title.'.

    (b) GAO Study-

      (1) IN GENERAL- The Comptroller General of the United States shall conduct a study on the effectiveness of the performance bonus payment program under the amendment made by subsection (a) on the enrollment and retention of eligible children under the Medicaid and CHIP programs and in reducing the rate of uninsurance among such children.

      (2) REPORT- Not later than January 1, 2013, the Comptroller General shall submit a report to Congress on such study and shall include in such report such recommendations for extending or modifying such program as the Comptroller General determines appropriate.

SEC. 112. STATE OPTION TO RELY ON FINDINGS FROM AN EXPRESS LANE AGENCY TO CONDUCT SIMPLIFIED ELIGIBILITY DETERMINATIONS.

    (a) Medicaid- Section 1902(e) of the Social Security Act (42 U.S.C. 1396a(e)) is amended by adding at the end the following:

    `(13) Express Lane Option-

      `(A) IN GENERAL-

        `(i) OPTION TO USE A FINDING FROM AN EXPRESS LANE AGENCY- At the option of the State, the State plan may provide that in determining eligibility under this title for a child (as defined in subparagraph (F)), the State may rely on a finding made within a reasonable period (as determined by the State) from an Express Lane agency (as defined in subparagraph (E)) when it determines whether a child satisfies one or more components of eligibility for medical assistance under this title. The State may rely on a finding from an Express Lane agency notwithstanding sections 1902(a)(46)(B), 1903(x), and 1137(d) and any differences in budget unit, disregard, deeming or other methodology, if the following requirements are met:

          `(I) PROHIBITION ON DETERMINING CHILDREN INELIGIBLE FOR COVERAGE- If a finding from an Express Lane agency would result in a determination that a child does not satisfy an eligibility requirement for medical assistance under this title and for child health assistance under title XXI, the State shall determine eligibility for assistance using its regular procedures.

          `(II) NOTICE REQUIREMENT- For any child who is found eligible for medical assistance under the State plan under this title or child health assistance under title XXI and who is subject to premiums based on an Express Lane agency's finding of such child's income level, the State shall provide notice that the child may qualify for lower premium payments if evaluated by the State using its regular policies and of the procedures for requesting such an evaluation.

          `(III) COMPLIANCE WITH SCREEN AND ENROLL REQUIREMENT- The State shall satisfy the requirements under (A) and (B) of section 2102(b)(3) (relating to screen and enroll) before enrolling a child in child health assistance under title XXI. At its option, the State may fulfill such requirements in accordance with either option provided under subparagraph (C) of this paragraph.

        `(ii) OPTION TO APPLY TO RENEWALS AND REDETERMINATIONS- The State may apply the provisions of this paragraph when conducting initial determinations of eligibility, redeterminations of eligibility, or both, as described in the State plan.

      `(B) RULES OF CONSTRUCTION- Nothing in this paragraph shall be construed--

        `(i) to limit or prohibit a State from taking any actions otherwise permitted under this title or title XXI in determining eligibility for or enrolling children into medical assistance under this title or child health assistance under title XXI; or

        `(ii) to modify the limitations in section 1902(a)(5) concerning the agencies that may make a determination of eligibility for medical assistance under this title.

      `(C) OPTIONS FOR SATISFYING THE SCREEN AND ENROLL REQUIREMENT-

        `(i) IN GENERAL- With respect to a child whose eligibility for medical assistance under this title or for child health assistance under title XXI has been evaluated by a State agency using an income finding from an Express Lane agency, a State may carry out its duties under subparagraphs (A) and (B) of section 2102(b)(3) (relating to screen and enroll) in accordance with either clause (ii) or clause (iii).

        `(ii) ESTABLISHING A SCREENING THRESHOLD-

          `(I) IN GENERAL- Under this clause, the State establishes a screening threshold set as a percentage of the Federal poverty level that exceeds the highest income threshold applicable under this title to the child by a minimum of 30 percentage points or, at State option, a higher number of percentage points that reflects the value (as determined by the State and described in the State plan) of any differences between income methodologies used by the program administered by the Express Lane agency and the methodologies used by the State in determining eligibility for medical assistance under this title.

          `(II) CHILDREN WITH INCOME NOT ABOVE THRESHOLD- If the income of a child does not exceed the screening threshold, the child is deemed to satisfy the income eligibility criteria for medical assistance under this title regardless of whether such child would otherwise satisfy such criteria.

          `(III) CHILDREN WITH INCOME ABOVE THRESHOLD- If the income of a child exceeds the screening threshold, the child shall be considered to have an income above the Medicaid applicable income level described in section 2110(b)(4) and to satisfy the requirement under section 2110(b)(1)(C) (relating to the requirement that CHIP matching funds be used only for children not eligible for Medicaid). If such a child is enrolled in child health assistance under title XXI, the State shall provide the parent, guardian, or custodial relative with the following:

            `(aa) Notice that the child may be eligible to receive medical assistance under the State plan under this title if evaluated for such assistance under the State's regular procedures and notice of the process through which a parent, guardian, or custodial relative can request that the State evaluate the child's eligibility for medical assistance under this title using such regular procedures.

            `(bb) A description of differences between the medical assistance provided under this title and child health assistance under title XXI, including differences in cost-sharing requirements and covered benefits.

        `(iii) TEMPORARY ENROLLMENT IN CHIP PENDING SCREEN AND ENROLL-

          `(I) IN GENERAL- Under this clause, a State enrolls a child in child health assistance under title XXI for a temporary period if the child appears eligible for such assistance based on an income finding by an Express Lane agency.

          `(II) DETERMINATION OF ELIGIBILITY- During such temporary enrollment period, the State shall determine the child's eligibility for child health assistance under title XXI or for medical assistance under this title in accordance with this clause.

          `(III) PROMPT FOLLOW UP- In making such a determination, the State shall take prompt action to determine whether the child should be enrolled in medical assistance under this title or child health assistance under title XXI pursuant to subparagraphs (A) and (B) of section 2102(b)(3) (relating to screen and enroll).

          `(IV) REQUIREMENT FOR SIMPLIFIED DETERMINATION- In making such a determination, the State shall use procedures that, to the maximum feasible extent, reduce the burden imposed on the individual of such determination. Such procedures may not require the child's parent, guardian, or custodial relative to provide or verify information that already has been provided to the State agency by an Express Lane agency or another source of information unless the State agency has reason to believe the information is erroneous.

          `(V) AVAILABILITY OF CHIP MATCHING FUNDS DURING TEMPORARY ENROLLMENT PERIOD- Medical assistance for items and services that are provided to a child enrolled in title XXI during a temporary enrollment period under this clause shall be treated as child health assistance under such title.

      `(D) OPTION FOR AUTOMATIC ENROLLMENT-

        `(i) IN GENERAL- At its option, a State may initiate an evaluation of an individual's eligibility for medical assistance under this title without an application and determine the individual's eligibility for such assistance using findings from one or more Express Lane agencies and information from sources other than a child, if the requirements of clauses (ii) and (iii) are met.

        `(ii) INDIVIDUAL CHOICE REQUIREMENT- The requirement of this clause is that the child is enrolled in medical assistance under this title or child health assistance under title XXI only if the child (or a parent, caretaker relative, or guardian on the behalf of the child) has affirmatively assented to such enrollment.

        `(iii) INFORMATION REQUIREMENT- The requirement of this clause is that the State informs the parent, guardian, or custodial relative of the child of the services that will be covered, appropriate methods for using such services, premium or other cost sharing charges (if any) that apply, medical support obligations (under section 1912(a)) created by enrollment (if applicable), and the actions the parent, guardian, or relative must take to maintain enrollment and renew coverage.

      `(E) EXPRESS LANE AGENCY DEFINED- In this paragraph, the term `express lane agency' means an agency that meets the following requirements:

        `(i) The agency determines eligibility for assistance under the Food Stamp Act of 1977, the Richard B. Russell National School Lunch Act, the Child Nutrition Act of 1966, or the Child Care and Development Block Grant Act of 1990.

        `(ii) The agency notifies the child (or a parent, caretaker relative, or guardian on the behalf of the child)--

          `(I) of the information which shall be disclosed;

          `(II) that the information will be used by the State solely for purposes of determining eligibility for and for providing medical assistance under this title or child health assistance under title XXI; and

          `(III) that the child, or parent, caretaker relative, or guardian, may elect to not have the information disclosed for such purposes.

        `(iii) The agency and the State agency are subject to an interagency agreement limiting the disclosure and use of such information to such purposes.

        `(iv) The agency is determined by the State agency to be capable of making the determinations described in this paragraph and is identified in the State plan under this title or title XXI.

      For purposes of this subparagraph, the term `State agency' refers to the agency determining eligibility for medical assistance under this title or child health assistance under title XXI.

      `(F) CHILD DEFINED- For purposes of this paragraph, the term `child' means an individual under 19 years of age, or, at the option of a State, such higher age, not to exceed 21 years of age, as the State may elect.'.

    (b) CHIP- Section 2107(e)(1) of such Act (42 U.S.C. 1397gg(e)(1)) is amended by redesignating subparagraphs (B), (C), and (D) as subparagraphs (E), (H), and (I), respectively, and by inserting after subparagraph (A) the following new subparagraph:

        `(C) Section 1902(e)(13) (relating to the State option to rely on findings from an Express Lane agency to help evaluate a child's eligibility for medical assistance).'.

    (c) Electronic Transmission of Information- Section 1902 of such Act (42 U.S.C. 1396a) is amended by adding at the end the following new subsection:

    `(dd) Electronic Transmission of Information- If the State agency determining eligibility for medical assistance under this title or child health assistance under title XXI verifies an element of eligibility based on information from an Express Lane Agency (as defined in subsection (e)(13)(F)), or from another public agency, then the applicant's signature under penalty of perjury shall not be required as to such element. 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). The requirements of subparagraphs (A) and (B) of section 1137(d)(2) may be met through evidence in digital or electronic form.'.

    (d) Authorization of Information Disclosure-

      (1) IN GENERAL- Title XIX of the Social Security Act is amended--

        (A) by redesignating section 1939 as section 1940; and

        (B) by inserting after section 1938 the following new section:

`SEC. 1939. AUTHORIZATION TO RECEIVE PERTINENT INFORMATION.

    `(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, to the extent such conveyance meets the requirements of subsection (b).

    `(b) Requirements for Conveyance- Data or information may be conveyed pursuant to subsection (a) 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 or attempting to enroll 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 private entity described in the subsection (a) that publishes, 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 publication or disclosure.

    `(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) of such Act (42 U.S.C. 1397gg(e)(1)), as amended by subsection (b), is amended by adding at the end the following new subparagraph:

        `(J) Section 1939 (relating to authorization to receive data potentially pertinent to eligibility determinations).'.

      (3) 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) of such Act (42 U.S.C. 1396a(a)(25)(I)(i)) is amended--

        (A) by inserting `(and, at State option, individuals who are potentially eligible or who apply)' after `with respect to individuals who are eligible'; and

        (B) by inserting `under this title (and, at State option, child health assistance under title XXI)' after `the State plan'.

    (e) Effective Date- The amendments made by this section are effective on January 1, 2008.

SEC. 113. APPLICATION OF MEDICAID OUTREACH PROCEDURES TO ALL CHILDREN AND PREGNANT WOMEN.

    (a) In General- Section 1902(a)(55) of the Social Security Act (42 U.S.C. 1396a(a)(55)) is amended--

      (1) in the matter before subparagraph (A), by striking `individuals for medical assistance under subsection (a)(10)(A)(i)(IV), (a)(10)(A)(i)(VI), (a)(10)(A)(i)(VII), or (a)(10)(A)(ii)(IX)' and inserting `children and pregnant women for medical assistance under any provision of this title'; and

      (2) in subparagraph (B), by inserting before the semicolon at the end the following: `, which need not be the same application form for all such individuals'.

    (b) Effective Date- The amendments made by subsection (a) take effect on January 1, 2008.

SEC. 114. ENCOURAGING CULTURALLY APPROPRIATE ENROLLMENT AND RETENTION PRACTICES.

    (a) Use of Medicaid Funds- Section 1903(a)(2) of the Social Security Act (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 retention under this title of children of families for whom English is not the primary language; plus'.

    (b) Use of Community Health Workers for Outreach Activities-

      (1) IN GENERAL- Section 2102(c)(1) of such Act (42 U.S.C. 1397bb(c)(1)) is amended by inserting `(through community health workers and others)' after `Outreach'.

      (2) IN FEDERAL EVALUATION- Section 2108(c)(3)(B) of such Act (42 U.S.C. 1397hh(c)(3)(B)) is amended by inserting `(such as through community health workers and others)' after `including practices'.

SEC. 115. CONTINUOUS COVERAGE UNDER CHIP.

    (a) In General- Section 2102(b) of the Social Security Act (42 U.S.C. 1397bb(b)) is amended by adding at the end the following new paragraph:

      `(5) 12-months CONTINUOUS ELIGIBILITY- In the case of a State child health plan that provides child health assistance under this title through a means other than described in section 2101(a)(2), the plan shall provide for implementation under this title of the 12-months continuous eligibility option described in section 1902(e)(12) for targeted low-income children whose family income is below 200 percent of the poverty line.'.

    (b) Effective Date- The amendment made by subsection (a) shall apply to determinations (and redeterminations) of eligibility made on or after January 1, 2008.

Subtitle C--Coverage

SEC. 121. ENSURING CHILD-CENTERED COVERAGE.

    (a) Additional Required Services-

      (1) CHILD-CENTERED COVERAGE- Section 2103 of the Social Security Act (42 U.S.C. 1397cc) is amended--

        (A) in subsection (a)--

          (i) in the matter before paragraph (1), by striking `subsection (c)(5)' and inserting `paragraphs (5) and (6) of subsection (c)'; and

          (ii) in paragraph (1), by inserting `at least' after `that is'; and

        (B) in subsection (c)--

          (i) by redesignating paragraph (5) as paragraph (6); and

          (ii) by inserting after paragraph (4), the following:

      `(5) DENTAL, FQHC, AND RHC SERVICES- The child health assistance provided to a targeted low-income child (whether through benchmark coverage or benchmark-equivalent coverage or otherwise) shall include coverage of the following:

        `(A) Dental services necessary to prevent disease and promote oral health, restore oral structures to health and function, and treat emergency conditions.

        `(B) Federally-qualified health center services (as defined in section 1905(l)(2)) and rural health clinic services (as defined in section 1905(l)(1)).

      Nothing in this section shall be construed as preventing a State child health plan from providing such services as part of benchmark coverage or in addition to the benefits provided through benchmark coverage.'.

      (2) REQUIRED PAYMENT FOR FQHC AND RHC SERVICES- Section 2107(e)(1) of such Act (42 U.S.C. 1397gg(e)(1)), as amended by sections 112(b) and 112(d)(2), is amended by inserting after subparagraph (C) the following new subparagraph:

        `(D) Section 1902(bb) (relating to payment for services provided by Federally-qualified health centers and rural health clinics).'.

      (3) MENTAL HEALTH PARITY- Section 2103(a)(2)(C) of such Act (42 U.S.C. 1397aa(a)(2)(C)) is amended by inserting `(or 100 percent in the case of the category of services described in subparagraph (B) of such subsection)' after `75 percent'.

      (4) EFFECTIVE DATE- The amendments made by this subsection and subsection (d) shall apply to health benefits coverage provided on or after October 1, 2008.

    (b) Clarification of Requirement to Provide EPSDT Services for All Children in Benchmark Benefit Packages Under Medicaid-

      (1) IN GENERAL- Section 1937(a)(1) of the Social Security Act (42 U.S.C. 1396u-7(a)(1)) is amended--

        (A) in subparagraph (A)--

          (i) in the matter before clause (i), by striking `Notwithstanding any other provision of this title' and inserting `Subject to subparagraph (E)'; and

          (ii) 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).';

        (B) 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

        (C) 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 1902(a)(43) whether provided through benchmark coverage, benchmark equivalent coverage, or otherwise.'.

      (2) EFFECTIVE DATE- The amendments made by paragraph (1) shall take effect as if included in the amendment made by section 6044(a) of the Deficit Reduction Act of 2005.

    (c) Clarification of Coverage of Services in School-Based Health Centers Included as Child Health Assistance-

      (1) IN GENERAL- Section 2110(a)(5) of such Act (42 U.S.C. 1397jj(a)(5)) is amended by inserting after `health center services' the following: `and school-based health center services for which coverage is otherwise provided under this title when furnished by a school-based health center that is authorized to furnish such services under State law'.

      (2) EFFECTIVE DATE- The amendment made by paragraph (1) shall apply to child health assistance furnished on or after the date of the enactment of this Act.

    (d) Assuring Access to Care-

      (1) STATE CHILD HEALTH PLAN REQUIREMENT- Section 2102(a)(7)(B) of such Act (42 U.S.C. 1397bb(c)(2)) is amended by inserting `and services described in section 2103(c)(5)' after `emergency services'.

      (2) REFERENCE TO EFFECTIVE DATE- For the effective date for the amendments made by this subsection, see subsection (a)(5).

SEC. 122. IMPROVING BENCHMARK COVERAGE OPTIONS.

    (a) Limitation on Secretary-Approved Coverage-

      (1) UNDER CHIP- Section 2103(a)(4) of the Social Security Act (42 U.S.C. 1397cc(a)(4)) is amended by inserting before the period at the end the following: `if the health benefits coverage is at least equivalent to the benefits coverage in a benchmark benefit package described in subsection (b)'.

      (2) UNDER MEDICAID- Section 1937(b)(1)(D) of the Social Security Act (42 U.S.C. 1396u-7(b)(1)(D)) is amended by inserting before the period at the end the following: `if the health benefits coverage is at least equivalent to the benefits coverage in benchmark coverage described in subparagraph (A), (B), or (C)'.

    (b) Requirement for Most Popular Family Coverage for State Employee Coverage Benchmark-

      (1) CHIP- Section 2103(b)(2) of such Act (42 U.S.C. 1397(b)(2)) is amended by inserting `and that has been selected most frequently by employees seeking dependent coverage, among such plans that provide such dependent coverage, in either of the previous 2 plan years' before the period at the end.

      (2) MEDICAID- Section 1937(b)(1)(B) of such Act is amended by inserting `and that has been selected most frequently, by employees seeking dependent coverage, among such plans that provide such dependent coverage, in either of the previous 2 plan years' before the period at the end.

    (c) Effective Date- The amendments made by this section shall apply to health benefits coverage provided on or after October 1, 2008.

SEC. 123. PREMIUM GRACE PERIOD.

    (a) In General- Section 2103(e)(3) of the Social Security Act (42 U.S.C. 1397cc(e)(3)) is amended by adding at the end the following new subparagraph:

        `(C) PREMIUM GRACE PERIOD- The State child health plan--

          `(i) shall afford individuals enrolled under the plan a grace period of at least 30 days from the beginning of a new coverage period to make premium payments before the individual's coverage under the plan may be terminated; and

          `(ii) shall provide to such an individual, not later than 7 days after the first day of such grace period, notice--

            `(I) that failure to make a premium payment within the grace period will result in termination of coverage under the State child health plan; and

            `(II) of the individual's right to challenge the proposed termination pursuant to the applicable Federal regulations.

        For purposes of clause (i), the term `new coverage period' means the month immediately following the last month for which the premium has been paid.'.

    (b) Effective Date- The amendment made by subsection (a) shall apply to new coverage periods beginning on or after January 1, 2009.

Subtitle D--Populations

SEC. 131. OPTIONAL COVERAGE OF CHILDREN UP TO AGE 21 UNDER CHIP.

    (a) In General- Section 2110(c)(1) of the Social Security Act (42 U.S.C. 1397jj(c)(1)) is amended by inserting `(or, at the option of the State, under 20 or 21 years of age)' after `19 years of age'.

    (b) Effective Date- The amendment made by subsection (a) shall take effect on January 1, 2008.

SEC. 132. OPTIONAL COVERAGE OF LEGAL IMMIGRANTS UNDER THE MEDICAID PROGRAM AND CHIP.

    (a) Medicaid Program- Section 1903(v) of the Social Security Act (42 U.S.C. 1396b(v)) is amended--

      (1) in paragraph (1), by striking `paragraph (2)' and inserting `paragraphs (2) and (4)'; and

      (2) by adding at the end the following new paragraph:

    `(4)(A) A State may elect (in a plan amendment under this title) to provide medical assistance under this title, notwithstanding sections 401(a), 402(b), 403, and 421 of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, for aliens who are lawfully residing in the United States (including battered aliens described in section 431(c) of such Act) and who are otherwise eligible for such assistance, within either or both of the following eligibility categories:

      `(i) PREGNANT WOMEN- Women during pregnancy (and during the 60-day period beginning on the last day of the pregnancy).

      `(ii) CHILDREN- Individuals under age 19 (or such higher age as the State has elected under section 1902(l)(1)(D)), 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 medical assistance to such category and the cost of such assistance shall not be considered as an unreimbursed cost.'.

    (b) CHIP- Section 2107(e)(1) of such Act (42 U.S.C. 1397gg(e)(1)), as amended by section 112(b), 112(d)(2),and 121(a)(2), is amended by inserting after subparagraph (E) the following new subparagraphs:

        `(F) Section 1903(v)(4)(A) (relating to optional coverage of certain categories of lawfully residing immigrants), insofar as it relates to the category of pregnant women described in clause (i) of such section, but only if the State has elected to apply such section with respect to such women under title XIX and the State has elected the option under section 2111 to provide assistance for pregnant women under this title.

        `(G) Section 1903(v)(4)(A) (relating to optional coverage of categories of lawfully residing immigrants), insofar as it relates to the category of children described in clause (ii) of such section, but only if the State has elected to apply such section with respect to such children under title XIX.'.

    (c) Effective Date- The amendments made by this section take effect on the date of the enactment of this Act.

SEC. 133. STATE OPTION TO EXPAND OR ADD COVERAGE OF CERTAIN PREGNANT WOMEN UNDER CHIP.

    (a) CHIP-

      (1) COVERAGE- Title XXI (42 U.S.C. 1397aa et seq.) of the Social Security Act 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 assistance for pregnant women for targeted low-income pregnant women in accordance with this section, but only if--

      `(1) the State has established an income eligibility level--

        `(A) for pregnant women, under any of clauses (i)(III), (i)(IV), or (ii)(IX) of section 1902(a)(10)(A), that is at least 185 percent (or such higher percent as the State has in effect for pregnant women under this title) of the poverty line applicable to a family of the size involved, but in no case a percent lower than the percent in effect under any such clause as of July 1, 2007; and

        `(B) for children under 19 years of age under this title (or title XIX) that is at least 200 percent of the poverty line applicable to a family of the size involved; and

      `(2) the State does not impose, with respect to the enrollment under the State child health plan of targeted low-income children during the quarter, any enrollment cap or other numerical limitation on enrollment, any waiting list, any procedures designed to delay the consideration of applications for enrollment, or similar limitation with respect to enrollment.

    `(b) Definitions- For purposes of this title:

      `(1) ASSISTANCE FOR PREGNANT WOMEN- The term `assistance for pregnant women' has the meaning given the term child health assistance in section 2110(a) as if any reference to targeted low-income children were a reference to targeted low-income pregnant women.

      `(2) TARGETED LOW-INCOME PREGNANT WOMAN- The term `targeted low-income pregnant woman' means a woman--

        `(A) during pregnancy and through the end of the month in which the 60-day period (beginning on the last day of her pregnancy) ends;

        `(B) whose family income exceeds 185 percent (or, if higher, the percent applied under subsection (a)(1)(A)) of the poverty level applicable to a family of the size involved, but does not exceed the income eligibility level established under the State child health plan under this title for a targeted low-income child; and

        `(C) who satisfies the requirements of paragraphs (1)(A), (1)(C), (2), and (3) of section 2110(b), applied as if any reference to a child was a reference to a pregnant woman.

    `(c) References to Terms and Special Rules- In the case of, and with respect to, a State providing for coverage of assistance for pregnant women 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 reference in this title to child health assistance (other than with respect to the provision of early and periodic screening, diagnostic, and treatment services) with respect to such women is deemed a reference to assistance for pregnant women.

      `(3) Any such reference (other than in section 2105(d)) to a child is deemed a reference to a woman during pregnancy and the period described in subsection (b)(2)(A).

      `(4) In applying section 2102(b)(3)(B), any reference to children found through screening to be eligible for medical assistance under the State medicaid plan under title XIX is deemed a reference to pregnant women.

      `(5) There shall be no exclusion of benefits for services described in subsection (b)(1) based on any preexisting condition and no waiting period (including any waiting period imposed to carry out section 2102(b)(3)(C)) shall apply.

      `(6) In applying section 2103(e)(3)(B) in the case of a pregnant woman provided coverage under this section, the limitation on total annual aggregate cost-sharing shall be applied to such pregnant woman.

      `(7) In applying section 2104(i)--

        `(A) in the case of a State which did not provide for coverage for pregnant women under this title (under a waiver or otherwise) during fiscal year 2007, the allotment amount otherwise computed for the first fiscal year in which the State elects to provide coverage under this section shall be increased by an amount (determined by the Secretary) equal to the enhanced FMAP of the expenditures under this title for such coverage, based upon projected enrollment and per capita costs of such enrollment; and

        `(B) in the case of a State which provided for coverage of pregnant women under this title for the previous fiscal year--

          `(i) in applying paragraph (2)(B) of such section, there shall also be taken into account (in an appropriate proportion) the percentage increase in births in the State for the relevant period; and

          `(ii) in applying paragraph (3), pregnant women (and per capita expenditures for such women) shall be accounted for separately from children, but shall be included in the total amount of any allotment adjustment under such paragraph.

    `(d) Automatic Enrollment for Children Born to Women Receiving Assistance for Pregnant Women- If a child is born to a targeted low-income pregnant woman who was receiving assistance for pregnant women 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 on the date of such birth, based on the mother's reported income as of the time of her enrollment under this section and applicable income eligibility levels under this title and title XIX, 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 assistance for pregnant women 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 AMENDMENT- Section 2107(e)(1)(I) of such Act (42 U.S.C. 1397gg(e)(1)(H)), as redesignated by section 112(b), is amended to read as follows:

        `(I) Sections 1920 and 1920A (relating to presumptive eligibility for pregnant women and children).'.

    (b) Amendments to Medicaid-

      (1) ELIGIBILITY OF A NEWBORN- Section 1902(e)(4) of the Social Security Act (42 U.S.C. 1396a(e)(4)) is amended in the first sentence by striking `so long as the child is a member of the woman's household and the woman remains (or would remain if pregnant) eligible for such assistance'.

      (2) APPLICATION OF QUALIFIED ENTITIES TO PRESUMPTIVE ELIGIBILITY FOR PREGNANT WOMEN UNDER MEDICAID- Section 1920(b) of the Social Security Act (42 U.S.C. 1396r-1(b)) is amended by adding after paragraph (2) the following flush sentence:

    `The term `qualified provider' also includes a qualified entity, as defined in section 1920A(b)(3).'.

SEC. 134. LIMITATION ON WAIVER AUTHORITY TO COVER ADULTS.

    Section 2102 of the Social Security Act (42 U.S.C. 1397bb) is amended by adding at the end the following new subsection:

    `(d) Limitation on Coverage of Adults- Notwithstanding any other provision of this title, the Secretary may not, through the exercise of any waiver authority on or after January 1, 2008, provide for Federal financial participation to a State under this title for health care services for individuals who are not targeted low-income children or pregnant women unless the Secretary determines that no eligible targeted low-income child in the State would be denied coverage under this title for health care services because of such eligibility. In making such determination, the Secretary must receive assurances that--

      `(1) there is no waiting list under this title in the State for targeted low-income children to receive child health assistance under this title; and

      `(2) the State has in place an outreach program to reach all targeted low-income children in families with incomes less than 200 percent of the poverty line.'.

SEC. 135. NO FEDERAL FUNDING FOR ILLEGAL ALIENS.

    Nothing in this Act allows Federal payment for individuals who are not legal residents.

SEC. 136. AUDITING REQUIREMENT TO ENFORCE CITIZENSHIP RESTRICTIONS ON ELIGIBILITY FOR MEDICAID AND CHIP BENEFITS.

    Section 1903(x) of the Social Security Act (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)) is amended by adding at the end the following new paragraph:

    `(4)(A) Each State shall audit a statistically-based sample of cases of individuals whose eligibility for medical assistance (or child health assistance) is determined under section 1902(a)(46)(B) or under subsection (v)(4)(A) in order to demonstrate to the satisfaction of the Secretary that Federal funds under this title or title XXI are not unlawfully spent for benefits for individuals who are not legal residents. In conducting such audits, a State may rely on case reviews regularly conducted pursuant to its Medicaid Quality Control or Payment Error Rate Measurement (PERM) eligibility reviews under subsection (u) and the provisions of subsection (e) of section 1137 shall apply under this paragraph in the same manner as they apply under subsection (b) of such section.

    `(B) The State shall remit to the Secretary the Federal share of any unlawful expenditures for benefits, for aliens who are not legal residents, which are identified under an audit conducted under subparagraph (A).'.

Subtitle E--Access

SEC. 141. CHILDREN'S ACCESS, PAYMENT, AND EQUALITY COMMISSION.

    Title XIX of the Social Security Act is amended by inserting before section 1901 the following new section:

`CHILDREN'S ACCESS, PAYMENT, AND EQUALITY COMMISSION

    `Sec. 1900. (a) Establishment- There is hereby established as an agency of Congress the Children's Access, Payment, and Equality Commission (in this section referred to as the `Commission').

    `(b) Duties-

      `(1) REVIEW OF PAYMENT POLICIES AND ANNUAL REPORTS- The Commission shall--

        `(A) review Federal and State payment 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'), including topics described in paragraph (2);

        `(B) review access to, and affordability of, coverage and services for enrollees under Medicaid and CHIP;

        `(C) make recommendations to Congress concerning such policies;

        `(D) by not later than March 1 of each year, submit to Congress a report containing the results of such reviews and its recommendations concerning such policies; and

        `(E) by not later than June 1 of each year, submit to Congress a report 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, the Commission shall review the following:

        `(A) The factors affecting expenditures for services in different sectors (such as physician, hospital and other sectors), payment methodologies, and their relationship to access and quality of care for Medicaid and CHIP beneficiaries.

        `(B) The impact of Federal and State Medicaid and CHIP payment policies on access to services (including dental services) for children (including children with disabilities) and other Medicaid and CHIP populations.

        `(C) The impact of Federal and State Medicaid and CHIP policies on reducing health disparities, including geographic disparities and disparities among minority populations.

        `(D) The overall financial stability of the health care safety net, including Federally-qualified health centers, rural health centers, school-based clinics, disproportionate share hospitals, public hospitals, providers and grantees under section 2612(a)(5) of the Public Health Service Act (popularly known as the Ryan White CARE Act), and other providers that have a patient base which includes a disproportionate number of uninsured or low-income individuals and the impact of CHIP and Medicaid policies on such stability.

        `(E) The relation (if any) between payment rates for providers and improvement in care for children as measured under the children's health quality measurement program established under section 151 of the Children's Health and Medicare Protection Act of 2007.

        `(F) The affordability, cost effectiveness, and accessibility of services needed by special populations under Medicaid and CHIP as compared with private-sector coverage.

        `(G) The extent to which the operation of Medicaid and CHIP ensures access, comparable to access under employer-sponsored or other private health insurance coverage (or in the case of federally-qualified health center services (as defined in section 1905(l)(2)) and rural health clinic services (as defined in section 1905(l)(1)), access comparable to the access to such services under title XIX), for targeted low-income children.

        `(H) The effect of demonstrations under section 1115, benchmark coverage under section 1937, and other coverage under section 1938, on access to care, affordability of coverage, provider ability to achieve children's health quality performance measures, and access to safety net services.

      `(3) 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 payment policies under Medicaid or CHIP, the Secretary shall transmit a copy of the report to the Commission. The Commission 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 the Commission deems appropriate.

      `(4) AGENDA AND ADDITIONAL REVIEWS- The Commission shall consult periodically with the Chairmen and Ranking Minority Members of the appropriate committees of Congress regarding the Commission's agenda and progress towards achieving the agenda. The Commission 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 the Commission deems appropriate.

      `(5) AVAILABILITY OF REPORTS- The Commission shall transmit to the Secretary a copy of each report submitted under this subsection and shall make such reports available to the public.

      `(6) APPROPRIATE COMMITTEE OF CONGRESS- For purposes of this section, the term `appropriate committees of Congress' means the Committees on Energy and Commerce of the House of Representatives and the Committee on Finance of the Senate.

      `(7) VOTING AND REPORTING REQUIREMENTS- With respect to each recommendation contained in a report submitted under paragraph (1), each member of the Commission shall vote on the recommendation, and the Commission shall include, by member, the results of that vote in the report containing the recommendation.

      `(8) EXAMINATION OF BUDGET CONSEQUENCES- Before making any recommendations, the Commission shall examine the budget consequences of such recommendations, directly or through consultation with appropriate expert entities.

    `(c) Application of Provisions- The following provisions of section 1805 shall apply to the Commission in the same manner as they apply to the Medicare Payment Advisory Commission:

      `(1) Subsection (c) (relating to membership), except that the membership of the Commission shall also include representatives of children, pregnant women, individuals with disabilities, seniors, low-income families, and other groups of CHIP and Medicaid beneficiaries.

      `(2) Subsection (d) (relating to staff and consultants).

      `(3) Subsection (e) (relating to powers).

    `(d) Authorization of Appropriations-

      `(1) REQUEST FOR APPROPRIATIONS- The Commission shall submit requests for appropriations in the same manner as the Comptroller General submits requests for appropriations, but amounts appropriated for the Commission shall be separate from amounts appropriated for the Comptroller General.

      `(2) AUTHORIZATION- There are authorized to be appropriated such sums as may be necessary to carry out the provisions of this section.'.

SEC. 142. MODEL OF INTERSTATE COORDINATED ENROLLMENT AND COVERAGE PROCESS.

    (a) In General- In order to assure continuity of coverage of low-income children under the Medicaid program and the State Children's Health Insurance Program (CHIP), not later than 18 months after the date of the enactment of this Act, the Comptroller General of the United States, in consultation with State Medicaid and CHIP directors and organizations representing program beneficiaries, shall develop a model process for the coordination of the enrollment, retention, and coverage under such programs of children who, because of migration of families, emergency evacuations, educational needs, or otherwise, frequently change their State of residency or otherwise are temporarily located outside of the State of their residency.

    (b) Report to Congress- After development of such model process, the Comptroller General shall submit to Congress a report describing additional steps or authority needed to make further improvements to coordinate the enrollment, retention, and coverage under CHIP and Medicaid of children described in subsection (a).

SEC. 143. MEDICAID CITIZENSHIP DOCUMENTATION REQUIREMENTS.

    (a) State Option to Require Children to Present Satisfactory Documentary Evidence of Proof of Citizenship or Nationality for Purposes of Eligibility for Medicaid; Requirement for Auditing-

      (1) IN GENERAL- Section 1902 of the Social Security Act (42 U.S.C. 1396a) is amended--

        (A) in subsection (a)(46)--

          (i) by inserting `(A)' after `(46)'; and

          (ii) by adding at the end the following new subparagraphs:

      `(B) at the option of the State, require that, with respect to a child under 21 years of age (other than an individual described in section 1903(x)(2)) 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 documentation specified in section 1903(x)(3)); and

      `(C) comply with the auditing requirements of section 1903(x)(4);'; and

        (B) in subsection (b)(3), by inserting `or any citizenship documentation requirement for a child under 21 years of age that is more restrictive than what a State may provide under section 1903(x)' before the period at the end.

      (2) ELIMINATION OF DENIAL OF PAYMENTS FOR CHILDREN- Section 1903(i)(22) of such Act (42 U.S.C. 1396b(i)(22)) is amended by inserting `(other than a child under the age of 21)' after `for an individual'.

    (b) Clarification of Rules for Children Born in the United States to Mothers Eligible for Medicaid- Section 1903(x)(2) of such Act (42 U.S.C. 1396b(x)(2)) is amended--

      (1) in subparagraph (C), by striking `or' at the end;

      (2) by redesignating subparagraph (D) as subparagraph (E); and

      (3) 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'.

    (c) Documentation for Native Americans - Section 1903(x)(3)(B) of such Act is amended--

      (1) by redesignating clause (v) as clause (vi); and

      (2) by inserting after clause (iv) the following new clause:

      `(v) For an individual who is