Health Insurance Reform Could Harm Children

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Concerns over the negative impact of health insurance reform on children have been raised recently by child health and industry advocates. One concern is the possible burden on children’s hospitals because of cuts to hospitals, while another is associated with the repeal of the Children’s Health Insurance Program (CHIP).

Reductions to Children’s Hospitals
The first issue is the $155 billion reduction in federal payments over 10 years which hospital groups agreed to in July. A USA Today (Nov. 6) story reported that the industry’s trade group (National Association of Children’s Hospitals) claims these cuts will have a disproportionate impact on children’s hospitals, resulting in significant reductions in the health services they will be able to provide for children.

The problem is the proposed reduction in federal payments that reimburse hospitals for the care they provide to people who have no health insurance or who are on Medicaid. Children’s hospitals provide services to a greater share of patients on Medicaid than to general hospitals, and Medicaid pays hospitals less than private insurance. Children’s hospitals also have less to gain from an increase in the number of people who will get health insurance under the reform package because most of them already have coverage.

Therefore, hospitals that serve children are lobbying Congress to stop changes to health care that they claim could cost them hundreds of millions of dollars. The industry trade group estimates legislation approved by the Senate Finance Committee would reduce funding to children’s hospitals by $876 million. The bill in the House would cut it by $395 million.

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Elimination of CHIP
Elimination of the Children’s Health Insurance Program (CHIP) is another concern. The health reform bill passed by the House vote would repeal CHIP in 2014 and shift some low-income children into the Medicaid program while others would have to go to private plans that could be most costly and guarantee fewer benefits, noted The Washington Independent.

The reform bill passed by the House expands Medicaid eligibility to 150 percent of poverty and then sends all other children who live above that level to private health insurance plans, the so-called exchange mentioned in the reform package. While Medicaid programs are required to offer preventive care (a plan that includes early periodic screening, diagnosis and treatment), the exchange plans do not operate under the same mandate. Thus the families of children who end up with the exchange option will be forced to pay more for less coverage.

Not everyone is behind the drive to end CHIP. Sen. Jay Rockefeller (D-WVa) has sponsored an amendment to reauthorize CHIP through 2019, and members of the Finance Committee passed the amendment last month.

The future of health insurance reform in America is uncertain. For children who have no direct voice in the matter, the fallout of cuts to health insurance coverage and medical care could have a lasting negative impact on the rest of their lives.

SOURCES:
USA Today, Nov. 13, 2009 (Fritze)
The Washington Independent, Nov. 6, 2009 (Lillis)

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