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Newsletter Article


SCHIP Expansion Gaining Steam?

By Mary Agnes Carey, CQ HealthBeat Associate Editor

January 22, 2007 -- From presidential campaigns to business and consumer groups, more players in the health care scene are looking for ways to expand the State Children's Health Insurance Program (SCHIP) to cover more children.

The program, created in 1997 and up for reauthorization this year, has been hailed for its success but analysts say more must be done—through efforts such as greater public awareness and expansions—to cover the more than nine million children who are currently uninsured. Financing such an expansion, however, could prove difficult, since Democrats have pledged to follow "pay as you go" or PAYGO rules, which require that spending be offset by spending cuts or tax increases.

Sen. Hillary Rodham Clinton, D-N.Y., who over the weekend launched an exploratory committee for her widely expected 2008 bid for the presidency, told reporters she planned to raise the SCHIP income eligibility limit so that more children could enroll. For New York, where Clinton discussed SCHIP expansion at a campaign event, a family of four earning $75,000 would qualify for the program, according to published reports, which also stated that House Energy and Commerce Committee Chairman John D. Dingell, Jr., D-Mich., planned to introduce similar legislation.

On Jan. 18, advocates representing insurers, hospitals, physicians, drugmakers, and consumer groups proposed an expansion of Medicaid and SCHIP, along with new tax credits to offer health insurance coverage to half of the nation's 46.6 million uninsured. The first phase of the proposal would expand SCHIP funding by $45 billion; however, a Children's Defense Fund analysis said that would still leave a few million uninsured children without coverage.

The plan came under fire from the Children's Defense Fund, which said the proposal did not take several critical steps—such as increasing eligibility levels, guaranteeing coverage for SCHIP children, or requiring states to automatically enroll children—that are critical to reaching currently uninsured children.

Earlier this month, the Children's Defense Fund unveiled its own proposal to combine Medicaid and SCHIP into a single program that would guarantee children in all 50 states and the District of Columbia all medically necessary services. Children with family incomes at or below 300 percent of the federal poverty level ($60,000 for a family of four in 2006) would be able to buy into the program, with premiums and co-pays based on income.

In addition, pregnant women at or below 300 percent of the federal poverty level would be eligible for prenatal, delivery, and post-partum care for at least 60 days after birth.

The federal government, rather than states, would cover the costs of the child coverage expansion and enhanced benefits, with reimbursement rates for health care providers increased to the same level as Medicare, according to the plan.

An estimate prepared by the Lewin Group stated that the Children's Defense Fund proposal would cost $26.1 billion annually.

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