Prior to the congressional summer recess, both the House and Senate passed bills to reauthorize the State Children’s Health Insurance Program. The next step is for conferees to be named and a joint bill to be drafted. It is possible, however, that the conference appointments will be blocked unless agreements are reached so that the cost and scope of the bill is limited. Despite multiple meetings on the topic, a spokesperson for Sen. Charles Grassley (R-Iowa) stated that "real negotiations have not yet begun." It is not yet known how Congress will keep SCHIP running beyond the September 30 program expiration date. The reauthorization also faces another major obstacle—President Bush has threatened to veto both the House and Senate bills as they stand. The House bill, H.R. 3162, reauthorizes the program with a $47 billion expansion and includes cuts to Medicare Advantage. The Senate bill, S. 976, reauthorizes the program with a $35 billion increase. The administration’s budget proposal included only a $5 billion expansion.
There are a number of differences between the House and Senate on how to proceed with SCHIP reauthorization. House Ways and Means Committee Chair Charles Rangel (D-N.Y.) was quoted as saying that "We feel very strongly that we want to keep the package [SCHIP] together with Medicare reform." He added that House Energy and Commerce Chair John Dingle (D-Mich.) shares the same view. On the contrary, Senate Finance Committee Chair Max Baucus (D-Mont.) is on record saying he would like to address Medicare reform separately from SCHIP. Both the House bill and the Senate bill share at least one common point, which is SCHIP expansion though a cigarette tax increase.
Following passage in the House on July 27 of the farm bill (H.R. 2419), the Senate Agriculture Committee has been preparing to mark up its version of the bill this fall. The measure includes reauthorization of the Food Stamp Program, other federal nutrition programs, and a wide range of agriculture support programs. Sen. Tom Harkin (D-Iowa), chair of the Senate Agriculture Committee, has signaled that while he would like to move ahead with a markup as soon as possible, several factors will mean that action on the bill cannot be completed before current law expires on Sept. 30, and that an extension will be required. Among the obstacles are a heavy Senate schedule, disagreement over how to handle commodity support issues, and difficulties in finding offsets for new spending in the bill. Harkin supports a range of benefit improvements in the FSP similar to those passed by the House, particularly increases in the standard deduction and resource limits and several new income and resource exclusions. The House paid for these increases by adopting a controversial tax provision on foreign-owned companies, but a similar provision may not be viable in the Senate. On Sept. 7, Senate Finance Committee Chair Max Baucus was reported to be assembling a package of offsets for the farm bill, but it was unclear whether the amount of revenue generated would be enough to cover all the new spending, including funds for nutrition improvements, that Sen. Harkin would like to have.
The House bill raises the minimum FSP benefit, increases the standard deduction, removes the cap on the dependent care deduction, excludes military combat pay from income, indexes current asset limits for inflation, and excludes education and retirement accounts from being counted toward the resource limit, all of which APHSA supports. However, among the bill’s administrative provisions, there are three that APHSA opposes: a mandate that almost all program application and eligibility functions would have to be performed by merit employees; a requirement for states to repay the full dollar amount of overissued benefits resulting from systemic problems; and an extension of the administrative match cuts, first enacted in 1998, that reduce these funds for all but seven states. A recent APHSA letter discussing these administrative concerns. It is expected that the Senate bill will have provisions similar to most of those in the House version. Full details on H.R. 2419 are available at http://thomas.loc.gov/.
On Sept. 4, the APHSA and its affiliate, the National Association of State Medicaid Directors, sent a letter to U.S. Department of Health and Human Services Secretary Michael Leavitt calling for the rescission of an Aug. 17, 2007, State Health Official letter (SHO #07-001) on crowd-out in the SCHIP program. According to HHS, the intent of the SHO #07-001 letter is to clarify how the Centers for Medicare and Medicaid Services applies statute and regulations when reviewing requests from states to expand SCHIP eligibility to children in families with income levels above 250 percent of the federal poverty level. APHSA and NASMD state that the SHO #07-001 letter goes well beyond simple clarification of existing policy, and essentially establishes a new direction in SCHIP policy with no input from the states. This sentiment is also reflected in a Sept. 6 letter from the leadership of the House Committee on Energy and Commerce to Secretary Leavitt. Their letter calls SHO #07-001 a "… sharp departure from existing policy…" and notes that the new CMS policy direction was created "without any consultation with Congress, the states, or other stakeholders about the changes that were being considered or the nature of those changes."
The SHO #07-001 letter claims that over time, states have made use of five different strategies to prevent crowd-out: imposing waiting periods between dropping private coverage and enrollment; imposing cost sharing in approximation to the cost of private coverage; monitoring health insurance status at time of application; verifying family insurance statutes through insurance databases; and preventing employers from changing dependent coverage policies that would favor a shift to public coverage. Use of all these five strategies, in conjunction with certain components identified in the SHO #07-001 letter, is now mandatory for states who seek authority to extend SCHIP eligibility beyond the 250 percent of FPL.
APHSA and NASMD write that this new policy is "inexplicably and deeply troubling." Their main contentions regarding the new mandates include:
- Expansion over 250 percent of the FPL requires proof of 95 percent enrollment rates;
- Proof that the number of children with private insurance has not decreased by more than 2 percentage points over the past five years; and
- The one-year mandatory waiting period that eliminates prenatal care and reduced preventative care for children.
CMS released its estimates of the states that are determined to have met the 95 percent of eligible children enrolled in the program. According to the CMS estimates, only nine states do not meet that standard: Arizona, Idaho, Kansas, Montana, Nevada, North Dakota, South Dakota, and Utah. Many states have expressed skepticism at CMS’ figures and question the agency’s calculations.The APHSA/NASMD letter to Secretary Leavitt
. State Health Official letter #07-001
. Energy and Commerce Committee letter to Secretary Leavitt
On Sept. 5, the Administration for Children and Families issued the final rule outlining the error rate reporting methodology that will be applied to the Child Care and Development Fund. The error rate reporting initiative will serve to implement provisions of the Improper Payments Information Act of 2002 and the President’s Management Agenda’s goal of eliminating improper payments. The final rule includes several revisions to the proposed version that was issued last March. APHSA and its affiliate, the National Association of State Child Care Administrators, submitted comments in response to the proposed rule expressing concerns about many elements of the methodology, implementation plan and future implications of the proposal. The final rule identifies three significant technical changes to the proposed version, and also addresses 22 comments that were received from various organizations, including the APHSA and NASCCA.
The first of three significant technical changes noted by ACF in the final rule is that the monetary and time annual burden estimates have been increased in the final rule to reflect the staffing, travel, automated system and other administrative demands involved in implementing the error rate methodology. The annual estimated cost burden has been raised from $150,000 to $180,000 for a single jurisdiction. The annual number of average burden hours for the Record Review Worksheet, the Data Entry Form, and the State Improper Payments Report were also increased. The second and third changes are that the term "child record" has been changed to "case record," and that language has been deleted in Section 98.102(a) (6) that would have required the error rate targets set by states to be lower than their most recently submitted estimated error rate. The final rule is available here.
On Aug. 31, CMS published the final rule on the Payment Error Rate Measurement system for Medicaid and SCHIP in the Federal Register. The final rule sets forth the state requirements to provide information to calculate the state-specific and national payment error rates. According to CMS, the PERM program is designed to bring the agency into compliance with the Improper Payments Information Act, which requires CMS to report annual estimates of improper payments for both Medicaid and SCHIP. The regulations in this rule become effective on Oct. 1, 2007. A series of interim final rules was published on state requirements, and this rule summarizes those requirements as well as outlining state requirements for conducting eligibility reviews and estimating error rates due to errors in eligibility determination. CMS expects to be in full compliance with IPIA by 2008. CMS also expects the states to take corrective actions after their error rates have been calculated to reduce their error rates. Selected states will be required to submit a corrective action report.
The rule stated the requirements are based on those from the second interim final rule on Aug. 26, 2006, and responds to common comments to the interim rule. These requirements spell out the following:
- The requirement that states must calculate error rates for both Medicaid and SCHIP during the same fiscal year, beginning in FY 2007;
- The data that states will need to provide each type of federal contractor (statistical contractors, documentation/database contractors, and review contractors); and
- The eligibility measurement methodology that states must use to determine the eligibility-related payment error rates.
The final rule is available here
On Sept. 5, Voices for America’s Children held a Children’s Congress on Race at George Washington University in Washington. Voices for America’s Children is a national children’s advocacy organization with affiliates throughout the country. The congress provided facilitation of presentations and discussion around racial inequities and social injustices and their effects on children in the United States. Reps. Carolyn Kilpatrick (D-Mich.), James Clyburn (D-S.C.), and Donna M. Christensen (D-V.I.) spoke during the event. The Annie E. Casey Foundation’s Race Matters Toolkit was also distributed and a short training regarding the materials was presented. Several states are implementing the Race Matters Toolkit in a variety of organizations that address children’s issues. The toolkit is available here.
On Aug. 28, the Census Bureau released new statistics on the number of uninsured Americans, who are estimated to have risen from 44.8 million (15.3 percent) in 2005 to 47 million (15.8 percent) in 2006. This marks the sixth year of increase in the number of uninsured Americans. The report, Income, Poverty, and Health Insurance Coverage in the United States: 2006 Report, found that both the number of those with private health insurance and the number with government insurance have not changed since 2005. The number covered by Medicaid was also found to be statistically unchanged from 2005 to 2006 at 38.3 million (12.9 percent). The number of Americans with employer-based insurance, however, was found to have decreased from 60.2 percent in 2005 to 59.7 percent in 2006. The findings further indicate that race/ethnicity is a significant factor in uninsured rates for all Americans. While the uninsured rate of non-Hispanic white Americans did not increase between 2005 and 2006 (at 10.8 percent), the uninsured rate of black Americans increased from 19.0 percent to 20.5 percent, and the uninsured rate of Hispanic Americans increased from 32.3 to 34.1 percent. The report estimates the number of uninsured children under the age of 18 to have risen from 8 million (10.9 percent) in 2005 to 8.7 million (11.7 percent) in 2006. Children in poverty had a much higher uninsured rate at 19.3 percent in 2006. The report also contains state-specific data on uninsured rates.
The press release can be found at here, and the report is here.