42 U.S.C. § 1397cc — Coverage requirements for children’s health insurance

(a) Required scope of health insurance coverage Child health assistance for a targeted low-income child under the type of plan described in section 1397aa(a)(1) must consist of one of the following types of coverage. These choices must be consistent with subsection (c)(5), (6), (7), and (8). (1) Benchmark coverage. Health benefits coverage must provide benefits at least equivalent to the coverage in one of the benchmark benefit packages in subsection (b). (2) Benchmark-equivalent coverage. The coverage must meet all of these requirements: (A) Inclusion of basic services. It must include benefits for items and services in every basic-service category listed in subsection (c)(1). (B) Aggregate actuarial value equivalent to benchmark package. Its total actuarial value must be at least actuarially equivalent to that of one benchmark benefit package. (C) Substantial actuarial value for additional services included in benchmark package. For every additional-service category listed in subsection (c)(2) that is covered by the benchmark package used under subparagraph (B), the coverage must have an actuarial value at least 75 percent of the value of that category in that package. (3) Existing comprehensive State-based coverage. The coverage may be coverage under an existing comprehensive State-based program described in subsection (d)(1). (4) Secretary-approved coverage. The coverage may be any other health benefits coverage that the Secretary, after a State applies, decides provides appropriate coverage for the targeted low-income children the State proposes to cover. (b) Benchmark benefit packages The benchmark benefit packages are: (1) FEHBP-equivalent children’s health insurance coverage. The standard Blue Cross/Blue Shield preferred-provider-option service benefit plan described in and offered under section 8903(1) of title 5. (2) State employee coverage. A health benefits coverage plan offered and generally available to State employees in the State involved. (3) Coverage offered through HMO. The health insurance coverage plan that— (A) is offered by a health maintenance organization, as that term is defined in section 2791(b)(3) of the Public Health Service Act; and (B) among the plans offered by that health maintenance organization in the State involved, has the largest insured commercial, non-Medicaid enrollment of covered lives. (c) Categories of services; determination of actuarial value of coverage (1) Categories of basic services. For this section, the basic-service categories are: (A) Inpatient and outpatient hospital services. (B) Physicians’ surgical and medical services. (C) Laboratory and X-ray services. (D) Well-baby and well-child care, including immunizations appropriate for the child’s age. (E) Mental-health and substance-use-disorder services, as described in paragraph (5). (2) Categories of additional services. For this section, the additional-service categories are: (A) Prescription-drug coverage. (B) Vision services. (C) Hearing services. (3) Treatment of other categories. Nothing in this subsection prevents a State child health plan from covering benefits outside the categories in paragraph (1) or (2). (4) Determination of actuarial value. The actuarial value of the benchmark packages, the State child health plan’s coverage, and each additional-service category under the packages and the State plan must be stated in an actuarial opinion in an actuarial report. The report must be prepared— (A) by a person who is a member of the American Academy of Actuaries; (B) using generally accepted actuarial principles and methods; (C) using a standardized set of use and price factors; (D) using a standardized population that represents privately insured children of the ages of the children expected to be covered under the State plan; (E) applying the same principles and factors when comparing the value of different coverage or service categories; (F) without considering differences in coverage based on the delivery method or the cost-control or use-control method; and (G) considering the State’s ability to reduce benefits by considering the increase in the actuarial value of coverage under the State plan that results from the plan’s limits on cost sharing. The actuary who prepares the opinion must choose and state in the memorandum the standardized set of factors and the population used under subparagraphs (C) and (D). (5) Mental health and substance use disorder services. No matter which type of coverage a State chooses under subsection (a), child health assistance under that coverage for targeted low-income children must— (A) cover mental-health services, including behavioral-health treatment, needed to prevent, diagnose, and treat a broad range of mental-health symptoms and disorders, including substance-use disorders; and (B) be delivered in a culturally and linguistically appropriate way. If the State chooses under section 1397ll to provide pregnancy-related assistance under the coverage, that assistance for targeted low-income pregnant women, as defined in section 1397ll(d), must also meet subparagraphs (A) and (B). (6) Dental benefits. (A) In general. Child health assistance for a targeted low-income child must cover dental services needed to prevent disease, promote oral health, restore oral structures to health and function, and treat emergency conditions. (B) Permitting use of dental benchmark plans by certain States. A State may meet subparagraph (A) through dental coverage equivalent to a benchmark dental benefit package described in subparagraph (C). (C) Benchmark dental benefit packages. The packages are: (i) FEHBP children’s dental coverage. A dental benefits plan under title 5, chapter 89A, that employees seeking dependent coverage selected most often, among plans providing that dependent coverage, in either of the previous two plan years. (ii) State employee dependent dental coverage. A dental benefits plan offered and generally available to State employees in the State involved that employees seeking dependent coverage selected most often, among plans providing that dependent coverage, in either of the previous two plan years. (iii) Coverage offered through commercial dental plan. A dental benefits plan offered in the State involved that has the largest insured commercial, non-Medicaid enrollment of dependent covered lives among such plans. (7) Mental health services parity. (A) In general. A State child health plan must ensure that the financial requirements and treatment limits for mental-health and substance-use-disorder services described in paragraph (5) comply with section 2726(a) of the Public Health Service Act in the same way those requirements and limits apply to a group health plan under that section. For requirements under section 2726(a)(8) of that Act, the plan is treated as complying if it complies with section 457.496 of title 42, Code of Federal Regulations, or any replacement regulation. (B) Deemed compliance. If a State plan covers an individual described in section 1396d(a)(4)(B) who is covered under the State plan under section 1396a(a)(10)(A), and it covers for that individual the services described in section 1396d(a)(4)(B), concerning early and periodic screening, diagnostic, and treatment services defined in section 1396d(r), provided according to section 1396a(a)(43), the plan is treated as satisfying subparagraph (A). (8) Construction on prohibited coverage. This section does not require health benefits coverage under the plan to cover an item or service for which payment is prohibited under this subchapter, even if a benchmark package covers that item or service. (9) Availability of coverage for items and services furnished through school-based health centers. Nothing in this subchapter limits a State’s ability to provide child health assistance for covered items and services furnished through school-based health centers, as defined in section 1397jj(c)(9). (10) Certain in vitro diagnostic products for COVID-19 testing. Child health assistance for a targeted low-income child must cover every in vitro diagnostic product described in section 1396d(a)(3)(B) that is administered during any part of the emergency period described in that section beginning on or after March 18, 2020, and must cover administration of the product. (11) Required coverage of COVID-19 vaccines and treatment. No matter which type of coverage a State chooses under subsection (a), child health assistance for a targeted low-income child must cover the following during the period beginning March 11, 2021, and ending on the last day of the first calendar quarter that begins one year after the last day of the emergency period described in section 1320b-5(g)(1)(B): (A) A COVID-19 vaccine and giving the vaccine. (B) COVID-19 testing and treatment, including specialized equipment and therapies, including preventive therapies. For an individual diagnosed with or presumed to have COVID-19, this also includes, during the time the individual has or is presumed to have COVID-19, treatment of a condition that may seriously complicate COVID-19 treatment, if the State child health plan or a waiver of that plan otherwise covers it. If a State chooses under section 1397ll to provide pregnancy-related assistance, the same coverage must be provided for a targeted low-income pregnant woman, as those terms are defined for that section. (12) Required coverage of approved, recommended adult vaccines and their administration. No matter which type of coverage a State chooses under subsection (a), if the State child health plan or a waiver provides child health assistance or pregnancy-related assistance to an individual age 19 or older, that assistance must cover the vaccines described in section 1396d(a)(13)(B) and their administration. (d) Description of existing comprehensive State-based coverage (1) In general. A program described here is a child health coverage program that— (A) covers a range of benefits; (B) is administered or overseen by the State and receives State funds; (C) is offered in New York, Florida, or Pennsylvania; and (D) was offered on August 5, 1997. (2) Modifications. A State may change such a program from time to time if it continues to meet subparagraph (1)(A) and does not reduce the program’s actuarial value below the lower of— (A) the program’s actuarial value on August 5, 1997; or (B) the actuarial value described in subsection (a)(2)(B), measured when the change is made. (e) Cost-sharing (1) Description; general conditions. (A) Description. A State child health plan must describe, consistently with this subsection, the amount, if any, of premiums, deductibles, coinsurance, and other cost sharing it imposes. Any such charges must be imposed under a public schedule. (B) Protection for lower-income children. The plan may vary premiums, deductibles, coinsurance, and other cost sharing based on the family income of targeted low-income children only in a way that does not favor children from higher-income families over children from lower-income families. (2) No cost sharing on benefits for preventive services, COVID-19 testing, a COVID-19 vaccine, COVID-19 treatment, or pregnancy-related assistance. The State plan may not impose deductibles, coinsurance, or other cost sharing for benefits involving: - Services in the well-baby and well-child category in subsection (c)(1)(D). - The in vitro diagnostic products in subsection (c)(10), and their administration. - The vaccines in subsection (c)(12), and their administration. - Services described in section 1396o(a)(2)(G). - Vaccines described in section 1396o(a)(2)(H) that are given during the period described there, and their administration. - Testing or treatment described in section 1396o(a)(2)(I) that is furnished during the period described there. - Pregnancy-related assistance. (3) Limitations on premiums and cost sharing. (A) Children in families with income below 150 percent of poverty line. For a targeted low-income child whose family income is at or below 150 percent of the poverty line, the State plan may not impose— (i) an enrollment fee, premium, or similar charge greater than the maximum monthly charge allowed under the standards for section 1396o(b)(1), for the individuals described there; or (ii) a deductible, cost sharing, or similar charge greater than a nominal amount, as determined consistently with the regulations referred to in section 1396o(a)(3), with a reasonable adjustment for inflation or other reasons that the Secretary determines to be reasonable. (B) Other children. For children not covered by subparagraph (A), and subject to paragraphs (1)(B) and (2), premiums, deductibles, cost sharing, and similar charges under the State plan may be set on an income-related sliding scale. But the total yearly cost sharing for all targeted low-income children in a family under this subchapter may not exceed 5 percent of that family’s income for the year. (C) Premium grace period. The State plan— (i) must give people enrolled in the plan at least 30 days from the start of a new coverage period to pay premiums before coverage may be ended; and (ii) must give the person notice no later than 7 days after the first day of that grace period. The notice must say— (I) that failing to pay within the grace period will end coverage under the State plan; and (II) that the person may challenge the proposed ending under the applicable Federal regulations. For clause (i), “new coverage period” means the month immediately after the last month for which the premium was paid. This section does not otherwise define that term. (4) Relation to Medicaid requirements. This subsection does not change the rules for enrollment fees, premiums, deductibles, cost sharing, or similar charges for targeted low-income children who receive child health assistance as coverage under a Medicaid program under section 1397aa(a)(2). (f) Application of certain requirements (1) Restriction on application of preexisting-condition exclusions. (A) In general. Subject to subparagraph (B), the State child health plan may not allow a preexisting-condition exclusion for covered benefits under the plan. (B) Group health plans and group health insurance coverage. If the State plan provides benefits through payment for, or a contract with, a group health plan or group health insurance coverage, it may allow a preexisting-condition exclusion only to the extent allowed by the applicable provisions of part 7 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 and title XXVII of the Public Health Service Act. (2) Compliance with other requirements. Coverage offered under this section must comply with subpart 2 of part A of title XXVII of the Public Health Service Act to the extent those requirements apply to a health-insurance issuer offering group health-insurance coverage. (3) Compliance with managed-care requirements. The State child health plan must apply subsections (a)(4), (a)(5), (b), (c), (d), (e), and (j) of section 1396u-2, concerning managed-care requirements, to coverage, State agencies, enrollment brokers, managed-care entities, and managed-care organizations under this subchapter in the same way those subsections apply to coverage and those entities and organizations under subchapter XIX.