Prevent Prematurity and Improve Child Health Act of 2007

Prevent Prematurity and Improve Child Health Act of 2007 - Amends titles XIX (Medicaid) and XXI (State Children's Health Insurance Program) (SCHIP) of the Social Security Act (SSA) to give states new options to cover: (1) low-income pregnant women; and (2) low-income legal immigrant pregnant women and children under Medicaid and SCHIP.

Extends coverage under Medicaid of prescription drugs and counseling services to tobacco cessation medications to help pregnant women enrolled in the program quit using tobacco. Requires coverage of tobacco cessation counseling services for pregnant women, and exempts such services from cost-sharing charges.

Gives states the option under Medicaid to: (1) provide family planning services and supplies to individuals with incomes that do not exceed a state's income eligibility level for medical assistance; and (2) extend the postpartum period for provision of family planning services and supplies.

Gives states the option to provide supplemental SCHIP coverage to children who have other health coverage.

Directs the Secretary of Health and Human Services to: (1) establish a demonstration program to provide payments to states for telemedicine services for the treatment of applicable individuals; (2) develop and disseminate a national set of core pediatric and perinatal quality measures; and (3) collect data regarding the extent to which states use pediatric and perinatal inpatient and outpatient quality measures on an ongoing basis.