CQ HEALTHBEAT NEWS
Sept. 4, 2007 – 4:55 p.m.
Senate GOP Move Stalls SCHIP Talks

Senate Republicans on Tuesday blocked a move to begin negotiating a compromise children’s health insurance bill, while state health officials asked Health and Human Services Secretary Michael O. Leavitt to repeal new children’s health insurance regulations.

Congress must renew or extend the State Children’s Health Insurance Program (SCHIP), a popular insurance program for children from low-income families, before it expires Sept. 30. But in the face of opposition from conservative Republicans and President Bush, Democrats are having trouble passing a large expansion of the program before the deadline. Meanwhile, in the absence of congressional action, Bush is seeking to make it more difficult for states to expand SCHIP on their own.

Both the House and Senate have passed legislation that would expand SCHIP — by nearly $50 billion in the House (HR 3162), to $75 billion over the next five years, and by about $35 billion in the Senate (HR 976), to $60 billion — and increase tobacco taxes. But the bills have vast differences: the House bill includes extensive Medicare provisions that are not in the Senate bill, while the Senate bill includes a larger tobacco tax increase than the House bill.

Democrats had hoped to quickly reconcile those differences in a conference committee, then clear the compromise bill in both chambers with substantial majorities. But that won’t happen soon.

Senate Majority Leader Harry Reid, D-Nev., tried Tuesday to appoint conferees on the bills by unanimous consent. But Minority Leader Mitch McConnell, R-Ky., objected, postponing the conference, for now. Senate Republicans say they want assurances ahead of a conference that the final bill will closely resemble the Senate-passed legislation in scope and spending, rather than the more ambitious and expensive House bill.

McConnell said he was objecting because the House had not yet formally requested a conference on the bills. Reid’s office later issued a news release accusing McConnell of “further obstructing bipartisan legislation.”

Also on Tuesday, the American Public Human Services Association and its affiliate, the National Association of State Medicaid Directors, sent a letter to Leavitt asking him to rescind new SCHIP regulations issued in a letter to state health officials on Aug. 17. The two organizations represent state health officials.

Among other provisions, the new regulations would require states to assure they have covered 95 percent of children from families earning less than twice the federal poverty level before expanding SCHIP to cover wealthier children. Many states have already expanded SCHIP to cover children from families earning three times the poverty level or more, or seek to do so, but state health officials say it would be impossible to make the assurance the Aug. 17 letter requires.

“The letter effectively changes the nature of the SCHIP program by seriously limiting the states’ flexibility in designing programs, imposing mandatory cost sharing requirements, requiring additional reporting mandates and imposing burdensome waiting periods,” wrote officials from the two organizations. However, the groups said they did not plan to sue the government to stop the new regulations.

“The fact is, we are strongly trying to convey to the states that as more seek to expand SCHIP to children in higher income families, we need to ensure that states first find their low-income children, the children for whom SCHIP was created before the program is expanded to higher-income children,” said Dennis G. Smith, director of the Center for Medicaid and State Operations at the Centers for Medicare and Medicaid Services, in a statement. “Moreover, we need to remind states of their obligation to adopt effective policies to prevent the substitution of private coverage for public coverage. We don’t think that states have adopted reasonable waiting periods, nor have states instituted relevant cost sharing. Because families at higher income levels are more likely to already have private insurance, substitution is more likely to occur as states expand to higher income levels.”

Source: CQ HealthBeat News
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