S. 2152 (McConnell)

Reauthorization of SCHIP and State Allotments
Appropriates $7 billion in funds for FY 2008, and increasing annual amounts are specified up to $8.8 billion in FY 2012.

Changes formula for state allotments to reflect actual and projected spending and the proportion of all uninsured children residing in the state and increases funding to territories. Allotments available to states for two years.

Coverage Expansions
Limits SCHIP coverage to "targeted low-income" children (those in families with incomes up to 200% of the FPL, or 50 percentage points above the Medicaid eligibility level in effect in 1997). Provides for the Medicaid matching rate rather than the enhanced SCHIP matching rate for children and pregnant women with higher incomes who are enrolled in state SCHIP coverage as of the date of enactment. Medicaid matching rate also provided for nonpregnant adults and parents covered under a Section 1115 waiver on the date of enactment. No coverage may be extended to individuals not covered on the date of enactment or for those who no longer satisfy eligibility levels specified by the state waiver. Prohibits the Secretary from approving, extending or renewing a state waiver, or experimental, pilot, or demonstration project that would use federal funds to provide coverage to any adults other than pregnant women.

Requires states to determine eligibility solely on the basis of a family's gross income (i.e., income disregards used by some states would no longer be allowed), and prohibits the Secretary from waiving this requirement. Requires the Secretary to issue interim final regulations within 90 days of enactment defining gross income for this purpose. The new definition would be applied when children currently enrolled are subject to an eligibility redetermination.

States may elect to continue coverage of enrolled children who lose eligibility solely as a result of the application of the new gross income requirement, but Medicaid matching rates would apply, and coverage could continue as long as the family income requirements in effect on September 30, 2007 were met.

Clarifies that pregnant women may be covered only under a section 1115 waiver or under existing regulations that provide states the option to provide prenatal care to mothers of eligible unborn children. Codifies the existing regulatory option for coverage of unborn children by defining a child for the purposes of eligibility to include, at state option, an unborn child; defines an unborn child; provides that states choosing this option may elect to provide 60 days postpartum care to the mother of the eligible unborn child; and gives states flexibility to define services to benefit the mother or unborn child consistent with the health of both.

Provides states the option to offer a premium assistance subsidy if the employer coverage is substantially equivalent to a SCHIP benchmark plan and the employer makes a contribution that is not less for employees receiving premium assistance than it is for other employees. Plans must also meet a cost effectiveness test by demonstrating that the marginal premium cost to purchase family coverage through the employer is less than the cost of SCHIP for the eligible child or children in the family, or that the marginal premium cost between individual coverage and purchasing family coverage through the employer is not greater than 175% of the cost to the state for providing SCHIP to a child. High deductible health plans are qualified for premium assistance.

States may require that children eligible for SCHIP accept coverage through a premium assistance subsidy.

States would no longer be required to provide supplemental benefits or cost sharing protection to children receiving a premium subsidy if the employer plan benefits are less generous than SCHIP.

States must impose a waiting period of at least 6 months from the time an individual is enrolled in a private health insurance plan to the provision of premium assistance. Enrollment in premium assistance shall not be counted as private plan enrollment for the purposes of waiting periods applied to SCHIP or Medicaid enrollment.

State laws must require employer plans to permit enrollment of children with premium assistance subsidies outside of annual open enrollment periods. Previously approved premium assistance programs are grandfathered.

Other changes to SCHIP or Medicaid coverage for children
None.

Outreach and enrollment
Appropriates $100 million each for FY 2008 and FY 2009, $75 million each for FY 2010 and FY 2011, and $50 million for FY 2012 for grants to increase participation of children eligible for Medicaid or SCHIP, with 10% set aside for a national enrollment campaign and 10% set aside for enrollment of children who are Native Americans. Grant funds awarded are available for two fiscal years and may not supplant nonfederal funds that are otherwise available for these activities.

Other provisions
None.

Financing
Appropriates $100 million each for FY 2008 and FY 2009, $75 million each for FY 2010 and FY 2011, and $50 million for FY 2012 for grants to increase participation of children eligible for Medicaid or SCHIP, with 10% set aside for a national enrollment campaign and 10% set aside for enrollment of children who are Native Americans. Grant funds awarded are available for two fiscal years and may not supplant nonfederal funds that are otherwise available for these activities.

Effective Date
Generally, October 1, 2007.