CHN: Congress on Brink of Expanding SCHIP

This week, prior to leaving town for the August recess, both the House and Senate approved proposals to renew the State Children’s Health Insurance Program (SCHIP).  The Senate voted 68-31 to approve the Senate Finance Committee’s SCHIP package on August 2. The vote signals a firm bipartisan commitment to reauthorize and strengthen the program.  Furthermore, with more than two-thirds of the Senate voting in favor of the bill (including 18 Republicans), the Senate has sufficient votes to override a Presidential veto.  The House passed its SCHIP proposal, the Children’s Health and Medicare Protection (CHAMP) Act of 2007, H.R. 3162, by a vote of 225 to 204 on August 1. The House vote was far more partisan, with only 5 Republicans joining the majority. The President has issued veto threats against both bills because of their funding increases. The President proposes a scanty $5 billion increase over five years – not enough to cover the number of children now enrolled.
The Senate proposal, S. 1893, provides $35 billion in increased funding over five years for SCHIP.  The increase is financed by a 61-cent tobacco tax increase. The Congressional Budget Office (CBO) estimates that under this proposal four million children who would otherwise be uninsured would be covered by 2012.  The approved Senate Finance Committee package includes other positive features aimed at strengthening the overall program and increasing enrollment. (For a detailed summary of the Senate Finance Committee package see the July 23 Human Needs Report.)

The House bill, however, goes even further than the Senate bill to strengthen the SCHIP program and cover more uninsured children. The CHAMP Act, which also contains improvements to Medicare, commits the full $50 billion over five years set aside for SCHIP in the budget resolution.  The additional funds, primarily paid for by a 45-cent federal tobacco tax increase and by reducing the subsidies provided to private insurance companies participating in Medicare, would provide health insurance to five million more children by 2012, one million more than the Senate’s bill.  The House bill produces greater coverage gains than the Senate because it contains an additional $15 billion increase, but also because it expands states’ eligibility options. Under the House bill states can opt to cover older children (up to the age of 25, phased in from 2010-2013), as well as legal immigrant children and pregnant women during their first five years in the United States (currently states can only cover legal immigrant children and pregnant women after they have lived in the United States for five years).  Like the Senate bill, the CHAMP Act also grants states the option of covering pregnant women without having to seek a waiver from the federal government.

The CHAMP Act’s Medicare improvements emphasize preventive care.  The bill allows Medicare to add preventive health benefits without seeking approval from Congress, and waives deductibles for preventive benefits.  In addition, it makes mental health care more affordable by reducing co-payment from 50 percent to 20 percent.  Rural fee-for-service Medicare protections are prevented from expiring, and subsidies to help low-income Medicare beneficiaries pay prescription drug and other costs are made more available.

There are other provisions in the CHAMP Act that make it a good bill. The proposal guarantees dental benefits and assures that mental health care services are treated the same as physical health benefits.  It continues to give states the flexibility of deciding the income eligibility levels for their SCHIP programs and allows the few states with parent coverage waivers to continue operating them.  No new parent coverage waivers would be granted unless the state can prove it is attempting to reach all children under 200% of the poverty line and that no children would be denied coverage in order to cover adults. Another positive feature of the bill is that it gives states more flexibility to address problems created by a burdensome citizenship documentation requirement in the Deficit Reduction Act (DRA) of 2006.  The citizenship documentation requirement has caused thousands of U.S. citizen children to lose or be denied coverage and has been costly for states to administer. The CHAMP Act does alleviate some of these problems by giving states the option to return to pre-DRA rules to prove citizenship for children and by allowing additional types of documents to prove citizenship for adults and for those states that decide to continue to operate under DRA rules. For an in- depth look at this issue see New Charges About how House Children’s Health Bill Affects Undocumented Immigrants are False, by CBPP:

Families USA has produced a helpful comparison of the Senate and House bills. Click here: to see their side-by-side comparison.

What’s next: Differences in the two bills will have to be resolved by a House-Senate Conference Committee. Bipartisan support will be needed to pass a final bill and override a potential veto.  For now, the approval of the two bills signifies a major victory for low-income families and children and health advocates.

Budget Report 2012 - Self-Inflicted Wounds