Children's Health Insurance Program
The statutory authorization for the State Children’s Health Insurance Program (SCHIP) expired on September 30 of this year. Between September 25 and 27, the House and Senate debated a bipartisan, bicameral SCHIP compromise that increased program spending by approximately $35B over five years. This $35B package was funded by a $.61 increase in the Federal tobacco tax. Despite a veto threat by President Bush, the House and Senate passed this legislation 265-159 and 67-29, respectively. President George W. Bush vetoed this compromise on October 3rd. ACAP participated in a nationwide effort to pressure Congress to override the President’s veto. Unfortunately, that veto override effort failed when the House could only generate 273 votes – 13 voted short of what was needed. Congressional Democrats and their Republican allies are planning on moving a slightly different version of this legislation by November in hopes of gaining enough votes to override another anticipated veto.
Congress Should Reauthorize SCHIP
ACAP has a strong record of supporting the expansion of Medicaid and SCHIP to ensure that more low-income Americans have access to public insurance at a time of general contraction in employer-based coverage and increases in the cost of private health insurance that price many low-income Americans out of coverage. At times like this, Medicaid and SCHIP are vital safety nets for an increasing number of Americans. SCHIP, enacted in 1997, has enjoyed substantial success in providing coverage to uninsured children. By 2006, well over 6 million children had been enrolled in SCHIP – and a national study suggests that the vast majority of these children would otherwise have been uninsured. Furthermore, SCHIP provided these children with needed primary care and other health services, decreasing the likelihood of unmet health care needs.
ACAP supports many of the SCHIP provisions included in H.R. 3162, the Children’s and Medicare Protection Act of 2007 (CHAMP), and H.R. 976, the Children's Health Insurance Program Reauthorization Act of 2007. Indeed, these bills include many of the policy positions that ACAP has called on Congress to address. Specifically, ACAP is on record asking for full funding – which appears in the House bill – of the SCHIP program to ensure that all low-income children who are eligible for SCHIP can be enrolled in SCHIP. Likewise, we have called on Congress to address other policy issues, including:
- Preserving and expanding eligibility options for children and parents (Sections 131 and 134 of H.R. 3162)
- Expanding CHIP benefits to include mental and dental health services (Sections 144 and 121 of H.R. 3162 and Section 607 of H.R. 976)
- Streamlining eligibility determinations for coverage under Medicaid and CHIP (Section 112 of H.R. 3162)
- Addressing the onerous DRA provisions related to citizenship documentation (Section 143 of H.R. 3162)
- Addressing the BBA restriction on Medicaid coverage for immigrants who are in the United States legally (Section 132 of H.R. 3162)
- Creating a MedPAC-type entity to review provider payments under Medicaid and CHIP (Section 141 of H.R. 3162)
- Protecting those states, aka “qualifying states,” that had extended coverage to low-income children prior to the creation of CHIP (Section 111 of H.R. 976)
- Extending Medicaid managed care quality standards to CHIP health plans (Section 152 of H.R. 3162 and Section 503 of H.R. 976)
Challenge for Medicaid Plans
Although ACAP supports the reauthorization of the SCHIP program, we have a serious concern that Section 812 of the House package could inadvertently devastate the ability of Medicaid health plans to effectively coordinate care for their enrollees. Section 812 of H.R. 3162 would increase the Medicaid drug rebate and encourage states to carve drugs out of Medicaid managed care. Specifically, ACAP is concerned that an increase in the drug rebate percentages without extending the Medicaid drug rebate to Medicaid health plans could incentivize states to carve-out prescription drugs – effectively undermining the ability of health plans to integrate prescription drugs into their care coordination system. A recent report by The Lewin Group outlines the dangers to integrated care posed by increases of the drug rebate that are unaccompanied by an expansion to Medicaid managed care. ACAP has drafted a separate policy brief on this topic.