This Congressional hearing records the testimony of administration and public witnesses on H.R. 9434 and S. 1392 and includes the texts of the legislation. H.R. 9434 is an act to amend the social security act to increase the dollar limitation and federal medical assistance percentages applicable to the medicaid programs of Puerto Rico, the Virgin Islands, and Guam. S. 1392 is the Child Health Assessment Act, which provides for the strengthening and improvement of the early and periodic screening, diagnosis and treatment program and broadens medicaid eligibility. Discussions focus on the populations to be covered, in terms of age and condition and cost efficiency of programs. The 65-page final report of the American Association of Psychiatric Services for Children to HEW on developmental review in the early and periodic screening, diagnosis and treatment program is included in the publication. In contrast to simple screening procedures, periodic review of the ways in which development is occurring and the forms it takes is advocated. Also included is a Research Digest Series report titled "Uncertainties of Federal Child Health Policies: Impact in Two States", which reviews two federally supported child health care programs from the original statement of Congressional intent to its questionable delivery at the local level. (RH)