Nine States With SCHIP Will Meet Federal Coverage Expansion Guidelines

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At leastnine states will meet federal SCHIP enrollment guidelines that will allow themto offer coverage to children in families with incomes greater than 250% of thefederal poverty level, CMS Center forMedicaid and State Operations Director Dennis Smith said Wednesday in testimony before the SenateFinance Subcommittee on Health Care, CongressDaily reports(Johnson, CongressDaily, 4/10). The Bush administration in aletter to state lawmakers on Aug. 17, 2007, outlined new standards for SCHIPenrollment. The new guidelines state that before expanding SCHIP eligibility tochildren in families with incomes greater than 250% of the poverty level,states must demonstrate that they have "enrolled at least 95% of childrenin the state below 200% of the federal poverty level" who are eligible forMedicaid or SCHIP (Kaiser Daily Health PolicyReport, 8/21/07).

According to Smith, 17 states have SCHIP income thresholds above 250% of the povertylevel. He said, "That's who this applies to. We have been talking to thestates, and we believe at least nine, again at this point, because we haven'tbeen everywhere, are going to meet the 95%." Smith did not comment on theother eight states, saying only that their data are being reviewed (CongressDaily,4/10).

Subcommittee Chair John Rockefeller (D-W.Va.) said the 95% requirement was notpossible to meet, noting that a number of outreach programs have failed toreach that goal. He also said that CMS does not have the legal authority tolimit enrollment at 250% of the poverty level or to require that states fundcoverage of beneficiaries with incomes above that level. Rockefeller hasintroduced legislation (S 2819) that would place a moratorium on implementationof the rules. Senate Finance Committee Chair Max Baucus (D-Mont.) said thedirective "goes in the wrong direction. It restricts coverage when weshould insure as many kids as possible."

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Smith said that the rules were meant to prevent "crowd out," or thesubstitution of public health care for private coverage. Finance Committeeranking member Chuck Grassley (R-Iowa) said the rules were "laudable"because "states should be covering their lowest-income kids first." Sen.Orrin Hatch (R-Utah) said, "Congress should do everything possible todiscourage crowd out."

Congressional Budget Office Director Peter Orszag said thepolicy directive would not have a significant impact on SCHIP enrollment"given the way the administration appears to be implementing it, and moreimportant, given the funding levels assumed in this baseline" (Carey, CQHealthBeat,4/9). According to Orszag, 5% of SCHIP beneficiaries are in families withincomes greater than 250% of the poverty level (CongressDaily, 4/10).

Reprintedwith permission from kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, and sign upfor email delivery at kaisernetwork.org/email . The Kaiser Daily Health PolicyReport is published for kaisernetwork.org, a free service of The Henry J.Kaiser Family Foundation.

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