The true impact isn't known yet, but an administrative change by the Centers for Medicare and Medicaid Services to rules governing the State Children's Health Insurance Program—made on a Friday night during Congress' August recess—may have the effect of dropping children who currently have coverage.
Sen. Jay Rockefeller (D-W.Va.), one of the original coauthors of SCHIP, sent a letter to President George W. Bush chiding the administration for making the change without congressional input.
“Not only do I question the wisdom and legality of this new policy, I also question the process,” wrote Sen. Rockefeller, noting that “a policy change of this magnitude should, at a minimum, be handled through the formal rule-making process, with proper public notice and comment.”
About 4 million children are eligible for Medicaid or SCHIP currently; some 6 million received benefits in 2006. An estimated 9 million children do not have health insurance.
SCHIP, now entering its 10th year, has been the subject of fierce battles this year, as lawmakers have struggled to come up with financing for the next 5 years. Authorization for SCHIP expires Sept. 30. Before leaving for summer recess, the House and the Senate passed very different packages.
President Bush said he would veto either bill, saying that he viewed both as a back-door way of expanding government-financed health care at the expense of the private insurance market.
So, the Aug. 17 letter from CMS Director for Medicaid and State Operations Dennis G. Smith to state health officials should not have come as a surprise. In the letter, states were told that if they were raising eligibility for children whose family incomes were equal to or above 250% of the federal poverty level, they would have to meet stringent new requirements. The goal: to ensure that these families aren't opting for SCHIP instead of private insurance.
CMS is now requiring that, for example, children be uninsured for at least 1 year before receiving SCHIP benefits. In addition, states also will have to document that the number of low-income children who are eligible for and covered by private insurance has not dropped by more than 2% in the past 5 years.
The House and Senate will meet in conference in September to determine the course of SCHIP over the next 5 years.