Some Democrats Respond To Bush Administration Decision Not To Enforce SCHIP Directive, Call On CMS To Stop Blocking States' SCHIP Expansion Plans

Main Category: Medicare / Medicaid / SCHIP
Article Date: 19 Aug 2008 - 7:00 PDT

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Senate Finance Committee Chair Max Baucus (D-Mont.) and Sen. Jay Rockefeller (D-W.Va.) on Friday called on CMS to rescind an SCHIP directive scheduled to take effect on Monday, CQ HealthBeat reports (Reichard, CQ HealthBeat, 8/15).

According to guidelines issued by CMS in August 2007, before states can expand SCHIP eligibility to children in families with incomes greater than 250% of the federal poverty level, they first must demonstrate that they have enrolled at least 95% of eligible children in families with incomes less than 200% of the poverty level. Last week, CMS officials in a statement said that the agency "[a]t this time" does not plan to take action against states for failure to comply with the directive (Kaiser Daily Health Policy Report, 8/14).

Baucus said, "Maybe CMS is beginning to get it," adding, "This statement seems to show that CMS is finally making the connection between its misguided ... directive and the real kids it could hurt." Rockefeller said that the "reality is the Bush administration should not be applauded because nothing has changed," adding that the "only appropriate response is for CMS to formally rescind" the directive. In addition, he said, "Through this directive they are still committed to denying children's access to health care."

Ann Clemency Kohler, executive director of the National Association of State Medicaid Directors, said that most state officials have dropped plans to expand SCHIP this year. She said, "Most states believe that if CMS wants to make a change they should issue regulations or seek legislation" (CQ HealthBeat, 8/15).

CBO Increases Estimate of Cost of Expansion Bill
The latest version of a bill (HR 3963) proposed by Democrats that would expand SCHIP would cost $37.4 billion over five years and increase the federal budget deficit by $1.6 billion, a violation of pay/go rules, according to an estimate released on Aug. 12 by the Congressional Budget Office, CQ Today reports. An earlier version of the bill (HR 976) would have cost $34.9 billion over five years. According to CQ Today, the increased estimate of the cost of the bill "can be blamed on the passage of time, more than anything," because 2008 "would have been a relatively low-cost year" to begin the expansion compared with 2009.

House Democrats might hold a vote on the bill in September. However, the increased estimate of the cost of the legislation "leaves Democrats in a difficult position," as the bill "would have to either cover fewer children or raise more revenue -- perhaps by bumping up the tobacco tax increase that it already proposes" -- to "be compliant with pay-as-you-go rules," and, "given how delicate the balance between coverage and costs was in the existing bill, such a move could cause problems," CQ Today reports (Armstrong, CQ Today, 8/15).

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