The Family Opportunity Act (HR 1811), a bill that would allow families of children with disabilities to buy into the federal Medicaid program, hit a snag last week in the House. The Senate passed a similar bill on May 6 and the House had been scheduled to vote on the bill June 14 under suspension of the rules. Usually reserved for proposals with broad support, a vote under suspension of the rules requires a two-thirds majority to pass and does not allow for amendments. Opposition to the House bill as currently drafted caused it to be pulled from the floor.
The Family Opportunity Act, as crafted in both the House and Senate, would allow families with incomes of up to 250 percent of the federal poverty level ($47,125 for a family of four) to purchase Medicaid coverage in order to assist with health care costs for their disabled children. Currently only recipients of the means-tested Supplemental Security Income program qualify. This rule has limited many middle-income families from purchasing coverage and often forced families to forgo additional income in order to qualify for the coverage. The program’s expansion will cost $900 million over five years and will help an additional one million children.

Many advocates who had worked hard for the passage of the Family Opportunity Act expressed concern over wording in the House version that would have required the Medicaid expansion to be paid for by cutting elsewhere from Medicaid. As the Consortium for Citizens With Disabilities wrote in a letter to Congressional leaders, “We do not support an effort to strengthen and improve Medicaid for families of children with disabilities and persons in institutions by reducing critical funding for other groups of vulnerable Medicaid beneficiaries.” The language in the House bill reduced to 50 percent the federal reimbursements in targeted case management (TCM) for children in foster care, people with HIV/AIDS, and people with mental health or mental retardation in order to pay for the increase in Medicaid services. States now receive federal dollars for targeted case management based on their Federal Medical Assistance Percentage (FMAP), which provides more than 50 percent of the costs to poorer states. The offset, proposed by Chairman Barton (R-TX) of the Energy and Commerce Committee, would result in some states receiving less money for TCM. Other forms of case management which involve less active intervention by case managers are now limited to a 50 percent reimbursement rate.

House conservatives declined to allow the bill to proceed without inserting the cost offset measure, which was projected to save the federal government $1.4 billion over five years. The Senate bill did not include an offset measure because the fiscal year 2004 budget resolution included a reserve fund for Family Opportunity. The House-passed final budget resolution for fiscal year 2005 (which is not expected to pass the Senate) eliminated the reserve fund.

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