Two House Panels Approve Medicaid, COBRA, Health IT Funding In Economic Stimulus Package

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Health Insurance / Medical Insurance;  IT / Internet / E-mail;  Medical Practice Management
Article Date: 26 Jan 2009 - 3:00 PDT

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The House Ways and Means Committee and the House Energy and Commerce Committee approved Thursday a two-year, $825 billion economic stimulus package that includes additional funds for Medicaid, $20 billion for health care information technology and federal subsidies for health insurance premiums under COBRA, among other provisions, CQ Today reports.

Prior to approval of the stimulus package, the Ways and Means Committee approved an amendment proposed by Rep. Pete Stark (D-Calif.) that would prevent reductions in Medicaid reimbursements to hospices, long-term care facilities and medical students. The committee also approved an amendment proposed by Committee Chair Charles Rangel (D-N.Y.) that would make technical changes to health care provisions in the stimulus package.

The Energy and Commerce Committee approved an amendment proposed by Rep. Cliff Stearns (R-Fla.) under which individuals with annual incomes of more than $1 million could not qualify for COBRA subsidies. In addition, the committee approved an amendment proposed by Rep. Tim Murphy (R-Pa.) under which recipients of funds for health care IT would have to purchase technology manufactured in the U.S. (Wayne/Armstrong, CQ Today, 1/22).

On Friday, President Obama plans to meet with House and Senate Republicans to discuss their concerns about the stimulus package. Among other concerns, Senate Finance Committee ranking Republican Chuck Grassley (Iowa) said that, although he could "buy into 90%" of the stimulus package, he opposes the almost $90 billion in additional Medicaid funds included in the legislation because some governors would use the funds to address problems in other areas of their budgets (Kane, Washington Post, 1/23).

Lobbying Efforts
On Thursday, the National Business Group on Health in a letter to Rangel criticized a provision related to COBRA in the stimulus package (Burns, Dow Jones, 1/22). Under the stimulus package, the federal government would subsidize 65% of COBRA premiums for as long as 12 months. In addition, recently unemployed workers ages 55 and older or those with at least 10 years of tenure at their jobs could continue to receive health insurance through COBRA until they find a new job that offers coverage or reach age 65, when they can enroll in Medicare (CQ Today, 1/22).

NBGH supports temporary subsidies for COBRA premiums, but in the letter, NBGH President Helen Darling wrote that the group opposes the provision that would "extend COBRA indefinitely to former employees 55 and older and those with 10 years or more tenure in their jobs until they find a new job or until they are Medicare eligible." The cost of COBRA "can be as high as 133% to 150% of the average per-employee plan costs," Darling wrote, adding, "These costs would significantly increase if people could keep COBRA longer as they approach Medicare eligibility and their health care costs generally increase due to higher medical costs and higher rates of chronic conditions."

In the event that recently unemployed workers decide to retrain their health insurance for extended periods under COBRA, "then employer plans have to keep track of them, collect premiums and process COBRA payments for many years until their long ago employees either relinquish their coverage or it expires," and the "administrative burden for former employees would become permanent ... at the expense of current employees and their employers," according to Darling (Reichard, CQ HealthBeat, 1/22).

Senate To Change Comparative-Effectiveness Research Language
The Senate will change draft report language recently released by House Appropriations Committee Chair David Obey (D-Wis.) on a portion of the economic stimulus package that includes $1 billion for research on the comparative effectiveness of medical treatments, Senate aides said on Thursday, CongressDaily reports. The language raised concerns that the stimulus package would limit patient access to more expensive treatments.

Jennifer Mullin, a spokesperson for Sen. Tom Harkin (D-Iowa), said that the language "did not accurately reflect the intent of the appropriation language." She added, "We think the Senate report language will more accurately reflect what all parties involved (authorizers and appropriators) intended" (CongressDaily, 1/23).

Reprinted with kind permission from http://www.kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at http://www.kaisernetwork.org/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation.

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