H.R. 976 would amend the Internal Revenue Code of 1986 to provide tax relief for small businesses.

== Detailed Summary ==

<summary>
Small Business Tax ReliefChildren's Health Insurance Program Reauthorization Act of 2007 - Amends Internal Revenue Code provisions relating to small business to: (1) extend through 2008Makes the work opportunity tax credit: (2) qualify certain individuals between age 18 and 40 living in an empowerment zone, enterprise community, or renewal community for the work opportunity tax credit and expand the eligibility for, and amount of, such credit for certain disabled veterans; (3) increase to $125,000 (adjusted for inflation) the expensing allowance for small business assets and extend such increased allowance through 2010; (4) allow employers to claim a business tax credit for social security taxes paid with respect to employee cash tips without regard to any increase in the federal minimum wage rate; (5) allow a full credit against alternative minimum tax liability for the work opportunity tax credit and the employer credit for social security taxes paid with respect to employee cash tips; (6) treat certain businesses jointly ownedamendments made by married couples as sole proprietorships for tax purposes; (7) deny preferential tax ratesthis Act effective on capital gains and dividend income to certain dependentsOctober 1, 2007, regardless of taxpayers; and (8) grant the Internal Revenue Service with an additional four monthswhether final regulations have been promulgated to notify taxpayers of tax deficiencies before the suspension period for interest and penalties on underpayments takes effect.carry them out.

AmendsAllows certain state plans under titles XIX (Medicaid) or XXI (State Children's Health Insurance Program) (CHIP) (also known as SCHIP) of the Social Security Act (SSA) that require state legislation to meet additional requirements imposed by this Act additional time to make required plan changes.

Sets forth a contingent effective date for CHIP funding for FY2008.

<b>Title I: Financing - Subtitle A: Funding </b>- (Sec. 101) Amends SSA title XXI to reauthorize the CHIP program through FY2012 at increased levels.

(Sec. 102) Provides for the determination of allotments for the 50 states, the District of Columbia, and the commonwealths and territories for FY2008-FY2012.

(Sec. 103) Establishes in the Treasury the Child Enrollment Contingency Fund for payments to a state to eliminate its shortfall (the amount by which its available federal CHIP allotments are not adequate to cover its CHIP expenditures.)

(Sec. 104) Directs the Secretary of Health and Human Services to make a performance bonus payment to states to offset additional Medicaid and CHIP child enrollment costs resulting from enrollment and retention efforts. Makes appropriations for FY2008 for such payments. Requires certain funds transfers to cover FY2009-FY2012.

(Sec. 105) Reduces the availability of allotments for FY2008 and each ensuing fiscal year from three to two years.

(Sec. 106) Directs the Secretary to provide for redistribution of unused allotments for FY2005 and subsequent fiscal years to address state funding shortfalls.

(Sec. 107) Provides qualifying states the option to receive the enhanced portion of the CHIP matching rate for Medicaid (SSA title XIX) coverage of certain children.

(Sec. 108) Makes a one-time appropriation of additional funds to the Secretary of Health and Human Services for FY2012.

(Sec. 109) Revises funding requirements for the territories under CHIP and SSA title XIX (Medicaid) for FY2008-FY2012.

Removes federal matching payments for data reporting systems from the overall limit on payments to Puerto Rico, the Virgin Islands, Guam, the Northern Mariana Islands, and American Samoa.

Directs the Comptroller General to report to the appropriate congressional committees on federal funding under Medicaid and CHIP for such territories.

<b>Subtitle B: Focus on Low-Income Children and Pregnant Women</b> - (Sec. 111) Gives states the option to cover targeted low-income pregnant women under CHIP through a state plan amendment if certain conditions are met, including that the state has established an income eligibility level of at least 185% of the federal poverty line for pregnant women under Medicaid. Sets the minimum income eligibility level for children under age 19 at 200% of the poverty line applicable to a family of the size involved. Provides for automatic enrollment for children born to women receiving pregnancy-related assistance.

(Sec. 112) Provides for phase-out of CHIP coverage for nonpregnant childless adults, leaving states an option to apply for a Medicaid waiver to continue coverage for such adults. Prescribes terms and conditions for coverage of parents of targeted low-income children.

Directs the Comptroller General to study and report to Congress on whether: (1) the coverage of a parent, a caretaker relative, or a legal guardian of a targeted low-income child under a state CHIP health plan increases the enrollment of, or the quality of care for, children; and (2) such parents, relatives, and legal guardians who enroll in such a plan are more likely to enroll their children in such a plan or in a state Medicaid plan.

(Sec. 113) Eliminates counting Medicaid child presumptive eligibility costs against CHIP allotment.

(Sec. 114) Places a limitation on the matching rate (federal medical assistance percentage, or FMAP) for states that propose to cover children with effective family income exceeding 300% of the federal poverty line.

(Sec. 115) Allows a state to cover: (1) certain individuals and thereby receive federal financial participation for medical assistance for them under Medicaid; or (2) receive such federal financial participation for children made eligible as a result of an income or resource eligibility level expansion.

(Sec. 116) Directs the Comptroller General to report to the appropriate congressional committees and the Secretary on the best practices by states in addressing the issue of CHIP crowd-out (the substitution for a child of CHIP health benefits coverage for coverage other than under CHIP or Medicaid).

Directs the Secretary to arrange with the Institute of Medicine for a report to the appropriate congressional committees on: (1) the most accurate, reliable, and timely way to measure, on a state-by-state basis, the rate of public and private health benefits coverage among low-income children with family income that does not exceed 200% of the poverty line, and CHIP crowd-out; and (2) the least burdensome way to gather the necessary data to conduct such measurements. Makes appropriations for such report.

Directs the Secretary to publish in the Federal Register, and post on the public Department of Health and Human Services (HHS) website: (1) recommendations regarding best practices for states to use to address CHIP crowd-out; and (2) uniform standards for data collection by states to measure and report health benefits coverage for children with family income below 200% of the poverty line, and on CHIP crowd-out, including for children with family income that exceeds 200% of the poverty line.

Requires each state that submits a plan amendment (or waiver request) to provide for CHIP eligibility for higher income children (with effective family income exceeding 300% of the poverty line) to include with such plan amendment or request a description of how the state will: (1) address CHIP crowd-out for such children; and (2) incorporate recommended best practices.

Requires the Secretary to review each state plan amendment or waiver request submitted and determine whether: (1) it incorporates recommended best practices; and (2) the state meets the required enrollment targets.

Prohibits payments for higher income children to any state failing to meet the coverage target rate for low-income children.

Authorizes a state to elect to limit CHIP eligibility to a targeted low-income child on the basis of the existence of a valid medical support order on the child's behalf, but only if the state does not deny such eligibility on that basis if the child asserts that the order is not being complied with for any one of specified reasons (unless none of them applies).

Specifies such reasons for noncompliance with a medical support order as: (1) failure of the noncustodial parent to comply with the order; (2) failure of an employer, group health plan, or health insurance issuer to comply with such order; or (3) residence of the child in a geographic area in which CHIP benefits are generally unavailable.

<b>Title II: Outreach and Enrollment - Subtitle A: Outreach and Enrollment Activities</b> - (Sec. 201) Amends SSA title XXI to direct the Secretary to award grants during FY2008-FY2012 for outreach and enrollment efforts to increase the enrollment and participation of eligible children under CHIP and Medicaid.

Makes necessary appropriations.

Directs the Secretary to develop and implement a national enrollment campaign to improve the enrollment of underserved child populations in CHIP and Medicaid programs.

Allows payments under CHIP and Medicaid for translation or interpretation services in connection with the enrollment of, retention of, and use of services by, individuals for whom English is not their primary language.

(Sec. 202) Amends SSA title XI to provide for increased outreach and enrollment of Indians in CHIP and Medicaid.

Waives the 10% cap on CHIP payments for outreach with respect to any expenditures for outreach activities to families of Indian children likely to be eligible for child health assistance under the state Medicaid plan or related waivers.

(Sec. 203) Authorizes a state plan under the Medicaid and CHIP programs to rely on findings from an Express Lane agency to conduct simplified eligibility determinations.

Amends SSA title XIX to authorize a federal or state agency or private entity in possession of the sources of data directly relevant for Medicaid eligibility determination (including eligibility files maintained by an Express Lane agency) to convey such information to the state Medicaid agency, if such conveyance meets specified requirements. Prescribes civil and criminal penalties for improper disclosure of such information.

Directs the Secretary to enter into agreements necessary to permit a state that elects the Express Lane option to receive data directly relevant to determining eligibility and the correct amount of benefits under CHIP or Medicaid from: (1) the National Directory of New Hires; and (2) data regarding enrollment in insurance that may help to facilitate outreach and enrollment under the state Medicaid and CHIP plans and such other programs as the Secretary may specify.

<b>Subtitle B: Reducing Barriers to Enrollment</b> - (Sec. 211) Gives states the option, as an alternative to the current documentation requirement, to verify a declaration of U.S. citizenship or nationality for purposes of Medicaid or CHIP eligibility through verification of a name and Social Security number with the Commissioner of Social Security.

Applies such documentation requirements to CHIP.

(Sec. 212) Requires state child health insurance plans to describe procedures used to reduce administrative barriers to enrollment of children and eligible pregnant women under Medicaid or CHIP.

(Sec. 213) Requires the Secretary, in order to assure continuity of coverage, to develop a model process for the coordination of the enrollment, retention, and coverage under Medicaid and CHIP of children who frequently change their state of residency or otherwise are temporarily located outside of their state of residency.

<b>Title III: Reducing Barriers to Providing Premium Assistance - Subtitle A: Additional State Option for Providing Premium Assistance</b> - (Sec. 301) Gives states the option to provide a premium assistance subsidy for qualified employer-sponsored coverage to all targeted low-income children eligible for CHIP who have access to such coverage, if the child (or the child's parent) voluntarily elects to receive such a subsidy. Allows employers to opt-out of being paid the subsidy directly, in which event the state shall pay the employee.

Amends SSA title XIX to allow a state to elect to offer a similar voluntary premium assistance subsidy for qualified employer-sponsored coverage to all individuals under age 19 entitled to Medicaid.

Directs the Comptroller General of the United States to study and report to Congress on cost and coverage issues relating to any state premium assistance programs for which federal Medicaid and CHIP matching payments are made.

(Sec. 302) Requires state CHIP plans to describe procedures in place to provide outreach, education, and enrollment assistance for families of children likely to be eligible for premium assistance subsidies under CHIP.

Waives the 10% cap on CHIP payments for outreach activities to families of children likely to be eligible for premium assistance payments under the state child health plan or related waivers.

<b>Subtitle B: Coordinating Premium Assistance With Private Coverage</b> - (Sec. 311) Amends the Internal Revenue Code to require a group health plan to permit an employee who is eligible, but not enrolled, for coverage under the plan to enroll if either of the following conditions are met: (1) the employee or dependent covered under Medicaid or CHIP has coverage terminated as a result of loss of eligibility, and the employee requests coverage under the group health plan within 60 days after such termination; or (2) the employee or dependent becomes eligible for Medicaid or CHIP assistance if the employee requests coverage within 60 days after the eligibility determination date.

Directs the Secretary and the Secretary of Labor jointly to establish a Medicaid, CHIP, and Employer-Sponsored Coverage Coordination Working Group to: (1) develop the model coverage disclosure form; and (2) identify impediments to the effective coordination of coverage available to families.

<b>Title IV: Strengthening Quality of Care And Health Outcomes of Children</b> - (Sec. 401) Amends SSA title XI to direct the Secretary to identify and publish for general comment an initial, recommended core set of child health quality measures for use by state Medicaid and CHIP programs, health insurance issuers and managed care entities that contract with such programs, and item and service providers. Directs the Secretary to identify existing quality of care measures for children that are: (1) in use under public and privately sponsored health care arrangements; or (2) part of reporting systems that measure both the presence and duration of health insurance coverage over time.

Directs the Secretary to establish a pediatric quality measures program to improve and strengthen such initial core child health care quality measures.

Directs the Secretary to award: (1) grants and contracts for the development, testing, and validation of new, emerging, and innovative evidence-based measures for children's health care services; and (2) up to 10 grants to states and child health providers for demonstration projects to evaluate promising ideas for improving the quality of children's health care and the use of health information technology. Specifies funding.

Directs the Secretary to conduct a childhood obesity demonstration project. Authorizes appropriations for FY2008-FY2012.

Directs the Secretary to establish a program to encourage the development and dissemination of a model electronic health record format for children enrolled in a state Medicaid or CHIP plan.

Requires the Institute of Medicine to study and report to Congress on pediatric health and health care quality measures.

Makes FY2008-FY2012 appropriations for this section.

Increases the matching rate for collecting and reporting on child health measures.

(Sec. 402) Specifies the information each state must cover in its annual CHIP report to the Secretary, including eligibility criteria, enrollment, and retention data.

Requires the Comptroller General to study and report to the appropriate congressional committees on children's access to primary and specialty services under Medicaid and CHIP.

(Sec. 403) Requires a state child health plan to provide for application of certain managed care quality safeguards to CHIP coverage, state agencies, enrollment brokers, managed care entities, and managed care organizations in the same manner such safeguards are applied under the Medicaid program.

<b>Title V: Improving Access to Benefits</b> - (Sec. 501) Requires the child health assistance provided to a targeted low-income child to include coverage of dental services necessary to prevent disease and promote oral health, restore oral structures to health and function, and treat emergency conditions.

Requires the Secretary to develop, through entities that fund or provide perinatal care services to targeted low-income children under CHIP, a program to deliver oral health educational materials that inform new parents about risks for, and prevention of, early childhood caries and the need for a dental visit within their newborn's first year of life.

Directs the Comptroller General to study and report to Congress on children's access to dental services in underserved areas and to oral health care.

(Sec. 502) Provides for the parity of mental health services in CHIP plans with all covered medical and surgical benefits.

(Sec. 503) Applies the prospective payment system (PPS) to services provided by federally-qualified health centers (FQHCs) and rural health clinics.

(Sec. 504) Requires a state child health plan to afford individuals enrolled under it a grace period of at least 30 days from beginning of a new coverage period to make premium payments before the individual's coverage under the plan may be terminated.

(Sec. 505) Authorizes appropriations for FY 2008-FY 2012 to fund demonstration projects in up to 10 states over three years for voluntary incentive programs to promote children's receipt of relevant screenings and improvements in healthy eating and physical activity with the aim of reducing the incidence of type 2 diabetes.

(Sec. 506) Provides that nothing in SSA title XXI shall be construed as limiting a state's ability to provide child health assistance for covered items and services that are furnished through school-based health centers.

<b>Title VI: Program Integrity and Other Miscellaneous Provisions - Subtitle A: Program Integrity and Data Collection </b>- (Sec. 601) Applies a minimum FMAP of 90% to expenditures related to administration of payment error rate measurement (PERM) requirements applicable to CHIP.

Waives the 10% cap on CHIP administrative costs for all expenditures related to the administration of PERM requirements.

Prohibits the Secretary from calculating or publishing any national or state-specific error rate based on the application of PERM requirements to CHIP until after a final rule implementing such requirements is in effect for all states. Specifies requirements for any calculation of a national error rate or a state specific error rate after such a final rule is in effect for all states.

Requires the final rule implementing the PERM requirements to include: (1) clearly defined criteria for errors for both states and providers; (2) a clearly defined process for appealing error determinations by review contractors or specified agency and personnel; and (3) clearly defined responsibilities and deadlines for states in implementing any corrective action plans.

Directs the Secretary to review the Medicaid Eligibility Quality Control (MEQC) requirements with PERM requirements and coordinate consistent implementation of both sets of requirements, while reducing redundancies.

Prescribes requirements for a state option to substitute data resulting from the application of the PERM requirements to the state for data obtained from the application of MEQC requirements to the state, and vice versa, for specified purposes.

Directs the Secretary to establish state-specific sample sizes for application of the PERM requirements with respect to state child health plans beginning with FY2009.

(Sec. 602) Appropriates increased amounts for FY2008 for data collection regarding low-income children without health insurance coverage.

Requires the Secretary of Commerce, among other things, to make appropriate adjustments to the Current Population Survey (CPA) to: (1) develop more accurate state-specific estimates of the number of children enrolled under Medicaid; and (2) include health insurance survey information in the American Community Survey (ACS) related to children.

Authorizes the Secretary to transition to the use of all, or some combination of, ACS estimates, instead of the CPS, if the Secretary of Commerce so recommends.

(Sec. 603) Directs the Secretary, directly or through contracts or interagency agreements, to conduct an independent subsequent evaluation of ten states with approved child health plans. Makes FY2009 appropriations for such evaluation.

(Sec. 604) Revises requirements for audits of state CHIP programs. Declares that the Comptroller General (as well as the Secretary and the Office of Inspector General), for evaluation and audit purposes, shall have access to any books, accounts, and other documents related to the expenditure of federal CHIP funds that are in state or local government, grantee, or contractor possession, custody, or control.

(Sec. 605) Declares that nothing in this Act allows federal payment for individuals who are not legal residents.

<b>Subtitle B: Miscellaneous Health Provisions</b> - (Sec. 611) Amends the Deficit Reduction Act of 2005 to make a technical amendment to the requirement to provide early and periodic screening, diagnostic, and treatment (EPSDT) services for all children in benchmark benefit packages.

(Sec. 612) Amends the Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999 to repeal the requirement that the Secretary refer to CHIP as SCHIP or the state children's health insurance program.

(Sec. 613) Prohibits the Secretary from approving any new health opportunity account demonstration programs.

(Sec. 614) Amends the Consolidated Omnibus Budget Reconciliation Act of 1985, as added by the Omnibus Budget Reconciliation Act of 1990 and as amended by the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000, to exempt Medicaid health insuring organizations operated by public entities in Ventura and Merced Counties, California, from the requirement that they be Medicaid managed care organizations meeting certain criteria.

Declares that such exemption shall not apply with respect to any period for which the number of Medicaid beneficiaries enrolled with such health insuring organizations exceeds 16% (currently 14%) of the number of such beneficiaries in California.

Directs the Comptroller General to report to Congress on the extent to which state payment rates for Medicaid managed care organizations are actuarially sound.

(Sec. 615) Provides that, only for purposes of computing the FMAP for a state for a fiscal year, beginning with FY 2006, and applying it under Medicaid, any significantly disproportionate employer pension or insurance fund contribution shall be disregarded in computing the state's per capita income, but shall not be disregarded in computing the per capita income for the continental United States (and Alaska) and Hawaii.

Prohibits any state from having its FMAP reduced as a result of the application of this section.

Directs the Secretary to report to Congress on: (1) the problems presented by the current treatment of pension and insurance fund contributions in the use of Bureau of Economic Affairs calculations for the FMAP and for Medicaid; and (2) possible alternative methodologies to mitigate such problems.

(Sec. 616) Prohibits the Secretary, before May 28, 2008, from taking any action to restrict Medicaid coverage or payment for rehabilitation services, or school-based administration, transportation, or medical services, if such restrictions are more restrictive in any aspect than those applied as of July 1, 2007.

(Sec. 617) Deems the Medicaid disproportionate share hospital (DSH) allotments for Tennessee for each fiscal year, beginning with FY2008, to be $30 million. Continues the Medicaid DSH allotment for Hawaii for such fiscal year at the current $10 million. Provides for the treatment of Hawaii as a low-DSH state.

Prohibits the Secretary from imposing a limitation on the total amount of payments made to hospitals under QUEST section 1115 Demonstration Project except to the extent that it is necessary to ensure that a hospital does not receive payments in excess of certain amounts, or as necessary to ensure that such payments under the waiver and such payments pursuant to the allotment provided do not, in the aggregate in any year, exceed the amount that the Secretary determines is equal to the FMAP component attributable to the DSH payment adjustments for such year reflected in the budget neutrality provision of the QUEST Demonstration Project.

(Sec. 618) Provides that nothing in the prohibition on use of voluntary contributions, and the limitation on use of provider-specific taxes to obtain federal financial participation under Medicaid, shall be construed by the Secretary as prohibiting a state's use of funds as the nonfederal share of Medicaid expenditures where such funds are transferred from or certified by a publicly-owned regional medical center located in another state, so long as the Secretary determines that such use is proper and in the interest of the Medicaid program.

(Sec. 619) Requires the Secretary, beginning with FY2013, to provide for the application to Medicaid asset eligibility determinations of the automated, secure, web-based asset verification request and response process being applied under a specified demonstration project for determining eligibility for benefits under SSA title XVI (Supplemental Security Income) (SSI).

<b>Subtitle C: Other Provisions</b> - Support for Injured Servicemembers Act - (Sec. 621) Amends the Family and Medical Leave Act to provide for family leave for covered members of the armed forces, including related civilian federal civil service employees who give care to such servicemembers.

(Sec. 622) Military Family Job Protection Act - Prohibits a family member of a recovering servicemember from being denied retention in employment, promotion, or any benefit of employment by an employer on the basis of the family member's absence from employment for up to 52 workweeks in order to care for the servicemember.

(Sec. 623) Establishes a task force to conduct a nationwide campaign of education and outreach for small business concerns regarding the availability of coverage for children through private insurance options, the Medicaid program, and CHIP.

(Sec. 624) Expresses the sense of the Senate that it: (1) recognizes the necessity to improve affordability and access to health insurance for all Americans; (2) acknowledges the value of building upon the existing private health insurance market; and (3) affirms its intent to enact legislation this year that, with appropriate consumer protections, improves access to affordable and meaningful health insurance coverage for employees of small business and individuals.<br>

<b>Title VII: Revenue Provisions </b>- (Sec. 701) Amends the Internal Revenue Code to increase excise tax rates on cigars, cigarettes, cigarette papers and tubes, smokeless tobacco, pipe tobacco, and roll-your-own tobacco. Imposes a tax on floor stocks of tobacco products (other than certain cigars and cigarette papers and tubes), reduced by a $500 tax credit. Requires payment of such floor stock taxes on or before April 1, 2008. Extends the floor stock tax to articles located in a foreign trade zone on January 1, 2008.

(Sec. 702) Applies administrative tax law provisions relating to permits, inventory, reporting, and recordkeeping to manufacturers and importers of processed tobacco (i.e., any tobacco other than tobacco products).

Expands the authority of the Secretary of the Treasury to deny, suspend, or revoke permits for manufacturing or importing tobacco products.

Revises the definition of &quot;roll-your-own tobacco&quot; to include cigars or cigar wrappers.

Amends the Tariff Act of 1930 to apply limitation periods for assessment of tax under the Internal Revenue Code to alcohol and tobacco excise taxes.

Imposes an immediate excise tax on any tobacco products, cigarette paper, or tubes produced in the United States at any place other than the premises of a lawful manufacturer of such products.

(Sec. 703) Amends the Tax Increase Prevention and Reconciliation Act of 2005 to increasereduce the estimated tax ratepayment of income tax liability due in the third quarter of 2012 for corporations with assets of not less thanat least $1 billion in the third quarterfrom 114.75% to 113.75% of 2012.the payment otherwise due.
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== Status of the Legislation ==

<status>
Latest Major Action: 9/25/2007: Resolving differences --10/18/2007: Failed of passage in House actions.over veto. Status: On motion thatpassage, the House agree with amendmentsobjections of the President to the Senate Agreed tocontrary notwithstanding Failed by the Yeas and Nays: 265(2/3 required): 273 - 159, 1 Present156 (Roll no. 906).982).
</status>

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== Points in Favor ==

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== Points Against ==

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