SCHIP Extension Could Mean More Uninsured Children in the Short Run When Congress and President Bush failed to resolve differences over the State Children's Health Insurance Program (SCHIP), set to expire this past fall, both sides settled for a compromise that would keep the popular program going until March 2009 when a new Congress and new President could revisit the problem. While the compromise reached in December fended off collapse of a widely admired program, a study by Genevieve M. Kenney for the Urban Institute indicates that for at least a short time, the number of uninsured children will increase. That result appears to have been unanticipated. (Editor's note: This increase will follow a 1-million-child increase in the number of uninsured children in the U.S. between 2004 and 2006.) As Kenney reports, SCHIP began in 1997 as a way to provide health coverage for children from families that earned too much to qualify for Medicaid and did not have private health insurance. In 2006, the plan covered about 6.7 million children and 700,000 adults. By most accounts, the program was a success. While increasing numbers of adults became uninsured during that period, more children were protected through SCHIP. According to Kenney, the program began to be seen as a way of expanding health insurance coverage. Under deadline With SCHIP set to expire last October 1, Democrats in Congress twice passed reauthorization bills and twice, President Bush vetoed them. Congress wanted to increase funding and expand the number of eligible children; the President wanted to hold down costs by not expanding the numbers covered. The Democratic bills tried to answer concerns about overall funding, the formula used to distribute money across the states, methods used to reach children not yet covered, and program quality control. Additionally, the Democratic proposals would have expanded the number of children covered. The first bill extended coverage to some adults and to children from families that had incomes above 200 percent of the federal poverty level. The bill would have increased funding much above what President Bush had proposed, which was significantly lower than the Congressional Budget Office said was needed. Kenney noted that besides opposing a funding increase, Congressional Republicans also opposed raising the income limit for eligible families. According to press reports, the opposition contained an undercurrent of the philosophical debate about the government’s role in providing health care, a harbinger of what will likely be at the core of the future debate on health care in general. Various compromise attempts failed in conference to bridge the differences between the two parties. Finally, in December, with the possibility of SCHIP expiring and the holidays nearing, Congress passed a bill extending the current program until March 2009, an extension that will last until four months after the November elections. Children left behind But according to the Urban Institute study, some children still will be left behind until the issue is finally settled. • First, fewer new dollars will be available to the states in fiscal year 2008 -- $6.6 billion compared to $9.125 billion proposed in the scaled-down second bill. States hoping to expand coverage will find that the increase inadequate. "Therefore, instead of seeing the increase in children’s coverage projected under both five-year SCHIP reauthorization bills that were passed by Congress but vetoed by the President, the number of uninsured children will likely increase, at least in the short run," the Urban Institute study says.• Second, the extension did not include provisions that would have encouraged the states to enroll more children in Medicaid and keep them enrolled in 2008 and beyond. More uninsured children are eligible for Medicaid than SCHIP, but states get less money covering them in Medicaid, that is, the states receive a lower Federal match for their dollars than they do under SCHIP. Thus, the assumption is that states will be reluctant to recruit more children into Medicaid. • Third, in August 2007, the Centers for Medicare and Medicaid Services (CMS) issued a directive placing conditions on states’ ability to use federal funds to cover children whose families earned more than 250 percent of the federal poverty level ($20,650 annually for a family of four). Most states will not be able to meet those conditions. The Congressional extension keeps that directive in force, making any broad expansion of coverage to children in families with more resources less likely. Indeed, the Urban Institute study says, it will be "difficult if not impossible, for states to comply." The result: many states willing to expand coverage will not be able to. The proposed 2009 budget submitted to Congress by the White House in January 2008 does increase funding (an additional $15 billion more than what the President proposed last year) but makes none of the policy changes that would encourage coverage for more children. That will not help the children left currently behind, the study says. The study may be found at: http://www.urban.org/UploadedPDF/411628_SCHIPfailure.pdf. |
