By Jim McLean and Dave Ranney
KHI News Service
Gov. Kathleen Sebelius reads to children at Topeka”s Lowman Hill Elementary School before conducting a news conference at which she called on Congress and President Bush to resolve their differences on legislation to renew the State Children”s Health Insurance Program. (Thad Allton/KHI)
TOPEKA, Sept. 10
A congressional deadline for renewing a health insurance program that covers approximately 6.6 million children nationally and 35,000 in Kansas is fast approaching. But a three-way political dispute among Democrats, Republicans and the White House is threatening to stall the renewal legislation, which polls show most voters want passed.
The
State Children”s Health Insurance Program
, or SCHIP, is scheduled to expire Sept. 30 if a reauthorization bill isn”t signed into law. Both the House and the Senate passed bills earlier this summer. But they have made little progress resolving differences between the two measures, which are considerable. Topping the list of differences is cost. The House bill would increase SCHIP spending approximately $50 billion over five years; the Senate bill, $35 billion.
The bills also differ significantly in how they would pay for the expansion. Both would raise the federal excise tax on a pack of cigarettes. The Senate bill would raise the 39 cent tax by 61 cents. The House bill would increase the tax by 45 cents. But to offset the proposed increase in SCHIP spending, the House bill would reduce some Medicare reimbursement rates.
In particular, Kansas Republicans are opposed to proposed reductions in subsidies paid to private insurance companies that provide private health plans to Medicare recipients; so-called Medicare Advantage plans.
President Bush has threatened to veto any SCHIP reauthorization bill that exceeds his proposed $5 billion expansion over the program over five years. But critics of the Bush proposal
including many Republicans
say $5 billion wouldn”t be sufficient to maintain coverage for children already enrolled in the program.
“It takes $15 billion to preserve the status quo,” said Kansas Gov. Kathleen Sebelius. “He (the president) has proposed only a third of that in the budget.”
Sebelius is one of several governors in recent weeks to publicly call on Congress and the president to resolve their differences and pass an SCHIP bill.
“What we don”t want to have happen is for Congress to walk away from this issue,” Sebelius said. “That”s just not acceptable. So, we are calling on Congress to step up and resolve this issue and get a consensus bill and, on the president, to hopefully back away from his veto promise.”
Crowd out a concern
The president and some congressional Republicans are concerned that any significant SCHIP expansion would potentially move people off private insurance into coverage subsidized by taxpayers.
“Dragging people out of private health insurance to put them into a government-run program is “Hillary care” come back,” House Republican leader John Boehner of Ohio said in July. “Republicans will fight these proposals.”
But Andrew Dick, a senior health economist at the RAND Corporation, said it isn”t that simple.
“If you just look at the number of kids insured prior to SCHIP and after, it looks like there”s crowd out,” Dick said. “But what you don”t know is the reason they left; it doesn”t mean they (parents) didn”t want their employer”s insurance. It may be their employer dropped its health insurance or they got fired or there was a change in circumstances and they couldn”t afford the premiums anymore. It”s not that there isn”t crowd out, it”s that there are many, many reasons that people lose their insurance.”
In fact, Dick said, a study he helped conduct in New York five years ago found that most new enrollees in the SCHIP program had been previously uninsured.
95 percent rule
In a move to limit states” ability to expand SCHIP eligibility, the Bush administration recently imposed a new rule. On Aug. 17, the Centers for Medicare and Medicaid Services (CMS) sent state officials a letter imposing new limitations on state attempts to expand SCHIP on their own.
Before states can allow children in families earning 250 percent of the
federal poverty level
$42,925 for a family of three
to enroll in the program, they must first sign up 95 percent of children below 200 percent of FPL.
“SCHIP was created for children in low-income working families,” said Dennis Smith, director of the federal Centers for Medicare ‘ Medicaid Services. “We want to make sure those kids are covered before we go to the higher-income kids.”
Friday, citing its earlier letter, CMS rejected the state of New York”s effort to expand its SCHIP program up to 400 percent of poverty.
The RAND Corporation”s Dick said the new 95 percent rule would effectively prevent states from expanding SCHIP.
“For a lot of reasons, verifying such a number is almost impossible,” he said. “There is always going to be a group of people
not a large group, but still a group
that will resist being insured. And we”re nowhere near 95 percent.”
A 2003 report by the Kansas Health Institute indicated that the vast majority of uninsured children in Kansas, 71 percent, are eligible for either Medicaid or SCHIP, but not enrolled in either. In Kansas, SCHIP, known as
HealthWave
,
is limited to children in households earning 200 percent or less of poverty. The program is designed to cover children in families that earn too much for Medicaid, but not enough to afford private health insurance.
Child advocates here and around the country have been critical of the administration”s new rule.
“I think the administration doctrine is clearly designed to make it impossible for states to cover more kids,” said Gary Brunk, executive director of
Kansas Action for Children
and chairman of a statewide coalition advocating for SCHIP expansion. “That 95 percent requirement is really an impossible barrier to overcome.”
Brunk said he is hopeful Congress will reverse that policy in its final version of the reauthorization bill.
Negotiations in limbo
U.S. House Speaker Nancy Pelosi addresses a labor rally last week at which she touted the House’s version of the SCHIP reauthorization bill. (Photo courtesy Speaker’s office)
Differences among Democrats and Republicans, the House and Senate and Congress and the White House have for now stalled conference committee negotiations on the two SCHIP bills. The House version is
HR 3162
. The Senate”s is
HR 976
.
Senate Minority Leader Mitch McConnell, R-KY., last week objected to the forming of the conference committee, saying he first wanted assurances the final bill would more closely resemble the Senate measure in scope and spending.
While the leadership spars, key members of the Kansas congressional delegation said they were eager to see the issue resolved.
“We can renew and expand SCHIP if we can get the politics
the Republican-Democrat, House-Senate, president-Congress politics
out of the debate,” said 1st Dist. Congressman Jerry Moran, a Hays Republican.
Moran, whose district covers the western two-thirds of the state, voted against the House”s $50 billion plan, he said, because it expanded SCHIP too much and funded it, in part, with reductions in Medicare reimbursements. But, Moran said, he could support something closer to the Senate”s $35 billion expansion, including the proposed 61 cent increase in the cigarette tax.
“I want to see the benefit we get for that, but it”s a concept I could support,” he said.
Second
Dist. Congresswoman Nancy Boyda, a Topeka Democrat, voted for the House bill. But she has indicated she”s open to compromise.
“There is a legitimate debate about which version (of the bill) is better, but I haven”t heard anyone in Kansas question the importance of passing the legislation,” Boyda said.
A poll done in August by the Robert Wood Johnson Foundation showed that Americans overwhelmingly support SCHIP. Nearly nine out of 10 voters surveyed, 86 percent, said they supported its reauthorization, with 63 percent saying they supported expanding the program by $35 billion over five years.
-Jim McLean and Dave Ranney are staff writers for KHI News Service, which specializes in coverage of health issues facing Kansans. They can be reached at 785-233-5443.