The House and Senate each cleared a bipartisan proposal to renew the State Children’s Health Insurance Program (SCHIP). Now it is up to the President to decide whether millions of low-income children will have access to health insurance.  The compromise bill approved by both chambers (H.R. 976) closely resembles the measure the Senate passed on August 2 and makes significant strides towards reducing the number of uninsured children living in the U.S.
H.R. 976 provides $35 billion in increased funding over five years for SCHIP.  The increase is financed by a 61-cent tobacco tax increase.  Under this measure, the 6.6 million children currently enrolled in SCHIP would continue to receive coverage and according to the Congressional Budget Office (CBO) an estimated 3.8 million otherwise-uninsured children would gain coverage. The bill improves the benefit package for children.  It makes dental care a guaranteed benefit, requires states offering mental health and substance abuse services through SCHIP to cover them similarly to medical and surgical benefits, and clarifies that Early and Periodic Screening, Diagnosis and Treatment (EPSDT) is required in all Medicaid benchmark plans.  Additionally, states have the option of covering pregnant women and enrolling children through Express Lane eligibility, which allows states to use financial information collected from WIC, school lunch, and other means-tested programs to identify and enroll children eligible for SCHIP or Medicaid.  Incentives and funding are also provided to encourage states to lower the rate of uninsured children and improve outreach and enrollment.

Another important feature of the bill is that it would replace the damaging directive issued by the federal Centers for Medicare and Medicaid Services (CMS) on August 17.  The directive bars states from covering children with family incomes above 250% of the federal poverty level (FPL) unless they meet certain standards. The Center for Children and Families has found that the new directive would likely bar SCHIP coverage for hundreds of thousands of children. (You can read CCF’s analysis of the directive at: http://ccf.georgetown.edu/pdfs/cmsdirective.pdf).  Instead of the CMS letter, H.R. 976 offers states time and help in developing and implementing best practices to minimize the extent their SCHIP plans replace private coverage (known as “crowd-out.”)

A key provision that was not included in the compromise bill was a House provision to lift the 5-year bar that prevents legal immigrant children from enrolling in SCHIP.  Acknowledging deep disappointment in the failure to include legal immigrant children, leaders in Congress pledged to find other vehicles to lift these restrictions.

Families USA has produced a helpful chart outlining the major components of the compromise bill and comparing it to the original House and Senate bills: http://www.familiesusa.org/assets/pdfs/chip-side-by-side-9-26-07.pdf.

What’s next:
With both chambers having voted on the SCHIP reauthorization bill, it is now in the hands of the President. The President is expected to veto the bill. The Administration claims that the bill does not focus on insuring poor children and instead expands coverage to children in families with incomes up to $83,000.  The President’s misleading claims have even angered members of his own party.  Under current law, states set the eligibility levels.  No state sets its cut-off as high as $83,000 for a family of four.  The bill just sent to the President, far from expanding the program, places constraints on states by eventually restricting the federal payment for states covering children in families with incomes over 300 percent of the federal poverty level.  As reported in a recent Center on Budget and Policy Priorities analysis, CBO estimates that 84 percent of the otherwise-uninsured children who would gain coverage under the bill have incomes below states’ current eligibility limits (http://www.cbpp.org/9-25-07health2.htm).

If the President vetoes the bill, which may happen as early as Tuesday, October 2, it will go back to Congress, at which point an override vote can be scheduled.  The Senate managed to attain a veto-proof majority, 67-29.  The House, on the other hand, did not reach the 289 votes needed to override a veto though it picked up a considerable number of Republicans (45).  The House passed the compromise bill on a 265-159 vote.  Many organizations will be working hard to persuade enough House members to change their votes to secure the override, with considerable press and public attention focused on these next votes.  One way the Congressional leadership is seeking to add to the public focus is in its choice of 12-year old Graeme Frost of Baltimore to make the response to the President’s weekly Saturday radio address.  Young Mr. Frost received health care through SCHIP after he suffered severe brain injuries a few years ago.

SCHIP expires on September 30.  Congress passed a continuing resolution this week, which includes an extension of the SCHIP program.  The CR will keep the program running through November 16.

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