SCHIP Reauthorization Bill Would Send Millions Of Dollars To Hospitals

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SCHIP Reauthorization Bill

The House has "quietly funneled hundreds of millions of dollars tospecific hospitals and health care providers" under the SCHIPreauthorization bill passed earlier this month, the New York Times reports (Pear, New York Times,8/12). The House SCHIP bill would reduce payments to Medicare Advantageplans and increase the federal cigarette tax by 45 cents per pack toincrease funding for SCHIP by about $50 billion over five years. Thebill also would make a number of revisions to Medicare (Kaiser Daily Health Policy Report, 8/9).

According to a Timesreview of the legislation, the House bill would "direct millions ofdollars a year to about 40 favored hospitals by increasing theirMedicare payments," mostly "at the request of Democratic lawmakers."Many of the earmarks would reclassify suburban hospitals as located inurban areas, which generally receive higher Medicare reimbursements tocover higher wages for hospital workers, according to the Times.Although Democrats have promised greater transparency of earmarks andother projects, the bill describes the hospitals "in cryptic terms, sothat identifying a beneficiary is like solving a riddle," the Times reports.

House Ways and Means Health SubcommitteeChair Pete Stark (D-Calif.) said that increasing payments to somehospitals is a way for Congress to improve "the equity and fairness" ofMedicare reimbursements. Under Medicare, "you are basically settingprices, and the system is clumsy," Stark said.

Health Subcommittee ranking member Dave Camp (R-Mich.) criticized a proposed adjustment that would reclassify Bay Area Medical Center-- located on the border of Wisconsin and Michigan -- as located inChicago. Camp called the provision "absurd on its face," adding, "Everyhospital in America would like to be reclassified" into a labor marketwith higher wages.

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Nadeam Elshami, spokesperson for HouseSpeaker Nancy Pelosi (D-Calif.), said, "It's easy to criticizeindividual provisions of large, complex bills," but "the focus shouldbe on the huge number of uninsured children who will be eligible forlife-saving health care under our bill" (New York Times, 8/12).

2008 Campaign

Efforts to pass SCHIP legislation provide "a glimpse into the emerging2008 campaign strategies of Republicans and Democrats" and illustrate"some of the problems House Republicans face in their first electioncycle as the minority party," the Times reports.

Aproposal in the House SCHIP bill that would reduce payments to MA plansprovides Republicans "an irresistible opening to go after Democrats,"according to the Times. Former Speaker J. Dennis Hastert(R-Ill.) said, "When seniors find out what is really going to happen[if payments to MA plans are cut], they are not going to be happy."However, analysts and others "suggest this could be a tough sell forRepublicans" because Democrats "have accumulated decades of credibilityon Medicare while Republicans, until recent years, were identified moreas foes of the program," the Times reports.

Inaddition, Democrats "believe they can easily paint Republican opponentsof the measure ... as being against helping poor sick kids," accordingto the Times. Democrats also are "getting important political cover" from AARP, which supports expanding SCHIP, according to the Times (Hulse, New York Times, 8/11).

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Reprinted with permission from kaisernetwork\t\t\t\t\t\t\t

Reprinted with permission fromkaisernetwork.org.You can view the entire KaiserDaily Health Policy Report, search the archives, andsign up for email delivery at kaisernetwork.org/email. The Kaiser Daily Health Policy Report is published forkaisernetwork.org,a free service of The Henry J. Kaiser Family Foundation.

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