On April 8, the House Committee on Energy and Commerce’s Subcommittee on Health passed H.R. 5613, the “Protecting the Medicaid Safety Net Act of 2008.”  The bill was introduced by Committee Chairman John Dingell (D-MI) and is cosponsored by 164 of his colleagues.  The bill would delay the imposition of seven new Medicaid regulations proposed by the Bush Administration until April 1, 2008, with the hope that a new administration would not press forward with them at that point. It passed by a bipartisan vote and is expecting action by the full Committee Wednesday, April 16.
The regulations are described by the Department of Health and Human Services as ensuring the integrity of Medicaid by preventing states from using funds inappropriately but instead would harm America’s vulnerable populations, including children, seniors and people with disabilities. Congress has already imposed delays on some of the proposed regulations, but these moratoria will expire within the next few months if no additional action is taken.

Among the regulations delayed by the Dingell bill is one that would deny federal funds for activities by school personnel to enroll eligible poor children in Medicaid, or for transporting children with disabilities or special health needs to school if they receive health services there.  Another would disallow federal Medicaid funds for case management for children in foster care or with disabilities or chronic health conditions.  Another regulation would end federal Medicaid funding for graduate medical education at teaching hospitals.  The Congressional Budget Office estimates the regulations would reduce federal Medicaid funding to states by at least $20 billion over a five-year period.   The cost to the federal government in FY 2009 for delaying implementation is estimated at $1.65 billion.

States, beneficiaries, and providers have voiced their concerns about the negative impact the regulations will have on the services they offer or receive.  They are concerned that shifting costs to the states, at a time when many are expected to face budget deficits, will force   a host of cuts to vital resources and services, hurting Medicaid beneficiaries and weakening the already damaged health care system.  For example, children placed in out-of-home care are at high risk for physical and mental health issues for a number of reasons.  Case management assists children in foster care with getting the services they need.  According to studies, the impact of the Targeted Case Management services on children in foster care is overwhelmingly positive.  The proposed rule would undermine the success of these services on this vulnerable population.  Furthermore, the regulations are expected to cut services to people with disabilities severely.  Advocates for children with disabilities are skeptical that school systems will be able to replace the lost funding, especially as so many are already squeezed financially.

There is bipartisan interest in continuing or establishing moratoria on these regulations in the Senate, as well as the House.  Senators Rockefeller (D-WV), Snowe (R-ME), and Kennedy (D-MA) introduced a similar bill, S. 2819, which was referred to the Committee on Finance on April 3.

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