In my neighborhood a number of parents have asked me about leveled reading and what program my wife and I use at home with our 7 year old daughter.
We use a site that the district where I work uses (Razkids). Razkids is an online guided reading program that includes ebooks, downloadables, as well as quizzes. Students are rewarded each time they either have a book read to them, they read it themselves as their own pace, as well as when they take a quiz.
These points can then be used the build their "rocket" as well as their "robot". My daughter honestly just likes accumulating points and is storing them for a rainy day.
Below you will see a 5 minute and 36 second YouTube video of what the site looks like from the student's point of view and then what it looks like from the parent's point of view.
As always, any questions please let me know!