I have plugged it before, but I like to remind people of Bookadventure.com during the summer. It is a free site, sponsored by Sylvan Learning. It is very simple to use.
First, the parent sets up an account for their child. Then your child reads a book and you find it on the site. Then up pops a reading comprehension test for that book. If you don't answer enough questions correctly, they can review the book and retake the test.
Kids earn points as they do this. Then the points transfer into prizes. Prizes can be as simple as a bookmark you download and print off to a 6 month subscription to Highlights Magazine.