Hous Soon Could Announce SCHIP Compromise Legislation

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State Children's Health Insurance Program

House Democrats on Thursday could announce a compromise with theSenate on legislation that would reauthorize and expand SCHIP,according to aides, CQ Today reports (Wayne, CQ Today,9/19). A draft compromise bill, announced on Sunday, reportedly closelyresembles the Senate version of SCHIP legislation, which would providean additional $35 billion in funding over the next five years and bringtotal spending on the program to $60 billion. The additional fundingwould be paid for by an increase in the tobacco tax, which would besimilar to the 61-cent-per-pack tax proposed in the Senate version. Thecompromise bill does not include revisions to Medicare (Kaiser Daily Health Policy Report, 9/19).

House Energy and Commerce Subcommittee on Health Chair Frank Pallone (D-N.J.), Senate Finance Committeeranking member Chuck Grassley (R-Iowa) and Sen. Orrin Hatch (R-Utah) onWednesday said that negotiators were close to reaching a deal. "We'rejust about there," Grassley said, adding, "There still are a couplethings outstanding" (CQ Today, 9/19).

Grassley onWednesday said that the final compromise bill will include $300 millionfor dental coverage and will adopt the formulas for state fundingincluded in the House SCHIP bill. Grassley said that Senate FinanceCommittee Chair Max Baucus (D-Mont.) found a way to add the dentalcoverage provision while ensuring the bill follows pay/go rules. Senatenegotiators adopted the House formulas for state funding in return fora guarantee that the final bill will provide only an additional $35billion over five years. According to CongressDaily,House Democrats "consider inclusion of dental benefits a victory, andthey hope the addition will help them collect votes" (Johnson, CongressDaily, 9/19).

Republican Response

Meanwhile, House Republicans on Wednesday "began to splinter on the issue" of SCHIP, according to CQ Today.Seventeen House Republicans told Democratic leaders that they supportthe compromise bill. If the 17 lawmakers vote for the compromise bill,along with the five Republicans who voted for the House SCHIP measure,the legislation would receive about 250 votes -- "still far short ofthe number Democrats would need to override a veto," CQ Today reports (CQ Today, 9/19).

Rep. Ray LaHood (R-Ill.), who is working with Democratic CaucusChair Rahm Emanuel (D-Ill.) to whip up Republican support, estimatedthat as many as 30 Republicans would vote for the compromise bill.However, House Energy and Commerce Committee ranking member Joe Barton (R-Texas) said he is sure House Republicans will be able to sustain a presidential veto (Johnson, CongressDaily,9/19). Republican leaders urged Democratic leaders to pass an extensionof the program rather than try to pass reauthorization legislation (CQ Today, 9/19).

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Lobbying Efforts

The absence of revisions to Medicare in the compromise SCHIP bill"changes the stakes for many" interest groups, who were "ready to putsome muscle behind passing" SCHIP legislation, The Hillreports. Lobbying groups "with a stake in the Medicare provisions willbe looking past SCHIP to restaging those fights," according to The Hill.

Supporters of the compromise SCHIP bill will have the "enthusiastic and active support of a number of groups," including Families USA, which next week will launch a lobbying campaign; the American Cancer Society and other members of the anti-tobacco lobby; and America's Health Insurance Plans,which strongly opposed the cuts to Medicare Advantage plans present inthe House bill. Other groups are undecided on whether to lobby insupport of the bill, according to The Hill.

AARPspokesperson Drew Nannis said, "I don't know where we're going to focusour money and our efforts. We still need to see what (the) finallegislation is going to look like" (Young, The Hill, 9/20).

Crowd-Out Report

In related news, Baucus on Wednesday criticized HHS for making revisions to a government-contracted report by Mathematica Policy Researchthat examined whether an expansion of SCHIP would cause crowd-out, thephenomenon of public coverage substituting for private insurance. CQ Todayreports that in the draft executive summary, the research firm wrote,"The evidence suggests that substitution of private coverage for SCHIPwas not an issue." HHS, which released the report on Wednesday, deletedthat sentence while adding that "the evidence suggests thatsubstitution of SCHIP for private coverage does occur," according to CQ Today.

Thereport found that between 10% and 56% of families enrolled in SCHIPdropped or declined private health insurance coverage, depending on howcrowd-out was calculated. The higher figure assumes that any reductionin private coverage found among children in lower-income familieseligible for SCHIP is caused by crowd-out -- a methodology the firmsaid has "limitations."

Timothy Love, director of the Office of Research, Development and Information at CMS,in a letter said that HHS asked Mathematica to reword the sentencebecause "some peer reviewers felt (the sentence) was not completelysupported by MPR's own discussion -- in short, it appeared to be overlyspeculative." Baucus said, "I'm troubled by the fact that this is notthe first time we've seen skewed information coming from" HHS regardingSCHIP (CQ Today, 9/19).

Reprinted with permission from kaisernetwork.org. Youcan view the entire Kaiser DailyHealth Policy Report, search the archives, and sign up for email deliveryat kaisernetwork.org/email. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, afree service of The Henry J. Kaiser Family Foundation.

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