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5 Program Options. As mentioned above, the law allows States to expand coverage for children through a separate child health insurance program, through a Medicaid expansion program, or through a combination of these programs. These options are described further below: • Option to Create a Separate Program- States may elect to establish a separate child health program that are in compliance with title XXI and applicable rules. These states must establish enrollment systems that are coordinated with Medicaid and other sources of health coverage for children and also must screen children during the application process to determine if they are eligible for Medicaid and, if they are, enroll these children promptly in Medicaid. • Option to Expand Medicaid- States may elect to expand coverage through Medicaid. This option for states would be available for children who do not qualify for Medicaid under State rules in effect as of March 31, 1997. Under this option, current Medicaid rules would apply.

Medicaid Expansion- CHIP SPA Requirements In order to expedite the SPA process, states choosing to expand coverage only through an expansion of Medicaid eligibility would be required to complete sections: • 1 (General Description) • 2 (General Background)

They will also be required to complete the appropriate program sections, including: • 4 (Eligibility Standards and Methodology) • 5 (Outreach) • 9 (Strategic Objectives and Performance Goals and Plan Administration including the budget) • 10 (Annual Reports and Evaluations).

Medicaid Expansion- Medicaid SPA Requirements States expanding through Medicaid-only will also be required to submit a Medicaid State Plan Amendment to modify their Title XIX State plans. These states may complete the first check-off and indicate that the description of the requirements for these sections are incorporated by reference through their State Medicaid plans for sections: • 3 (Methods of Delivery and Utilization Controls) • 4 (Eligibility Standards and Methodology) • 6 (Coverage Requirements for Children’s Health Insurance) • 7 (Quality and Appropriateness of Care) • 8 (Cost Sharing and Payment) • 11 (Program Integrity) • 12 (Applicant and Enrollee Protections)

• Combination of Options- CHIP allows states to elect to use a combination of the Medicaid program and a separate child health program to increase health coverage for children. For example, a State may cover optional targeted-low income children in families with incomes of up to 133 percent of poverty through Medicaid and a targeted group of children above that level through a separate child