“Targeted low-income child” defined

Subject to paragraph (2), the term “targeted low-income child” means a child—

(A) who has been determined eligible by the State for child health assistance under the State plan;

(B) (i) who is a low-income child, or (ii) is a child— (I) whose family income (as determined under the State child health plan) exceeds the medicaid applicable income level (as defined in paragraph (4)), but does not exceed 50 percentage points above the medicaid applicable income level; (II) whose family income (as so determined) does not exceed the medicaid applicable income level (as defined in paragraph (4) but determined as if “ June 1, 1997 ” were substituted for “ March 31, 1997 ”); or (III) who resides in a State that does not have a medicaid applicable income level (as defined in paragraph (4)); and

(C) who is not found to be eligible for medical assistance under subchapter XIX or, subject to paragraph (5), covered under a group health plan or under health insurance coverage (as such terms are defined in section 300gg–91 of this title ).

The term “medicaid applicable income level” means, with respect to a child, the effective income level (expressed as a percent of the poverty line) that has been specified under the State plan under subchapter XIX (including under a waiver authorized by the Secretary or under section 1396a(r)(2) of this title ), as of March 31, 1997 , for the child to be eligible for medical assistance under section 1396a( l )(2) or 1396d(n)(2) of this title (as selected by a State) for the age of such child.

(A) In general Subject to subparagraphs (B) and (C), in the case of any child who is enrolled in a group health plan or health insurance coverage offered through an employer who would, but for the application of paragraph (1)(C), satisfy the requirements for being a targeted low-income child under a State child health plan that is implemented under this subchapter, a State may waive the application of such paragraph to the child in order to provide— (i) dental coverage consistent with the requirements of subsection (c)(6) of section 1397cc of this title ; or (ii) cost-sharing protection for dental coverage consistent with such requirements and the requirements of subsection (e)(3)(B) of such section.

(B) Limitation A State may limit the application of a waiver of paragraph (1)(C) to children whose family income does not exceed a level specified by the State, so long as the level so specified does not exceed the maximum income level otherwise established for other children under the State child health plan.

(C) Conditions A State may not offer dental-only supplemental coverage under this paragraph unless the State satisfies the following conditions: (i) Income eligibility The State child health plan under this subchapter— (I) has the highest income eligibility standard permitted under this subchapter (or a waiver) as of January 1, 2009 ; (II) does not limit the acceptance of applications for children or impose any numerical limitation, waiting list, or similar limitation on the eligibility of such children for child health assistance under such State plan; and (III) provides benefits to all children in the State who apply for and meet eligibility standards. (ii) No more favorable treatment The State child health plan may not provide more favorable dental coverage or cost-sharing protection for dental coverage to children provided dental-only supplemental coverage under this paragraph than the dental coverage and cost-sharing protection for dental coverage provided to targeted low-income children who are eligible for the full range of child health assistance provided under the State child health plan.

(A) In general A child shall not be considered to be described in paragraph (2)(B) if— (i) the public agency that employs a member of the child’s family to which such paragraph applies satisfies subparagraph (B); or (ii) subparagraph (C) applies to such child.

(B) Maintenance of effort with respect to agency contribution for family coverage For purposes of subparagraph (A)(i), a public agency satisfies this subparagraph if the amount of annual agency expenditures made on behalf of employees enrolled in health coverage paid for by the agency that includes dependent coverage for the most recent State fiscal year is not less than the amount of such expenditures made by the agency for the 1997 State fiscal year, increased by the percentage increase in the medical care expenditure category of the Consumer Price Index for All-Urban Consumers (all items: U.S. City Average) for such preceding fiscal year.

(C) Hardship exception For purposes of subparagraph (A)(ii), this subparagraph applies to a child if the State determines that the annual aggregate amount of premiums and cost-sharing imposed for coverage of the family of the child would exceed 5 percent of such family’s income for the year involved.

In the case of a child who is an inmate of a public institution, during the 30 days prior to the release of the child from such institution the child shall not be considered to be described in paragraph (2)(A) with respect to the screenings, diagnostic services, referrals, and case management services otherwise covered under the State child health plan (or waiver of such plan) that the State is required to provide under section 1397bb(d)(2) of this title . At the option of the State, a child who is an inmate of a public institution shall not be considered to be described in paragraph (2)(A) during the period that the child is an inmate of such institution pending disposition of charges.