The House Ways and Means Committee early July 27, 2007 approved by a vote of 24-17 State Children’s Health Insurance Program (SCHIP) legislation that would expand the program over five years to cover 6 million additional children, provide reforms to the Medicare program and reduce overpayments to Medicare Advantage (MA) plans.
Medicare proposals
The bill's main Medicare proposals include replacing the impending 2008 and 2009 physician fee cuts (projected to be 10 percent and 5 percent, respectively) with a 0.5 percent update for both years. It would also phase out MA overpayments over four years to 100 percent of fee-for-service in 2011 and it would prohibit private plans from charging higher cost-sharing than FFS Medicare. It also would require all private plans to report quality data to CMS.
The proposal also would include new preventive benefits under Medicare, eliminate cost-sharing for preventive benefits and reduce Medicare’s 50 percent co-payment on mental health outpatient services and add additional mental health providers to Medicare.
The bill would expand the low-income subsidy program for Medicare Part D drugs, increase the allowable resource amounts under the asset test and eliminate the Part D late enrollment penalty for low-income subsidy eligible individuals.
The House bill includes dental care coverage and mental health care parity. States would be able to provide such coverage through multiple delivery arrangements including an HMO and PPO.
SCHIP Proposals
According to a bill summary, the Children’s Health and Medicare Protection Act would provide each state a SCHIP allotment for fiscal 2008 and states would have two years to spend each year’s annual allotment. The bill would maintain current eligibility rules, but states would have the option to cover pregnant women. The House bill includes dental care coverage and mental health care parity. States would be able to provide
The proposal differs in scope from the $35 billion expansion under consideration by the Senate (S 1893), which contains a 61-cent cigarette tax increase. The House bill (HR 3162) includes a $50 billion expansion, and a 45-cent cigarette tax increase. The president's proposal was for an additional $5 billion over five years above the $25 billion in current spending. The Bush administration also opposes the cigarette tax increases that would help pay for the expansion.
A counter proposal offered by House republicans would prohibit anyone with net assets above $500,000 from being eligible for SCHIP. In addition, the measure would cancel SCHIP coverage for adults beginning in fiscal year 2009 and prohibit the federal government from issuing waivers to states to expand coverage of adults. The House republican's proposal would also bar states from allowing beneficiaries to exclude certain expenses, such as car payments, from their reported income to qualify for SCHIP.
The measure faces a veto from President Bush. A veto could delay passage of reauthorization past the September 30 expiration date of the program and well into the fall, according to Center on Budget and Policy Priorities Executive Director Robert Greenstein. "If we fail to pass this bill, six million children will lose their healthcare coverage as of October," said Energy and Commerce Committee Chairman John Dingell (D-Mich.).
The House' Energy and Commerce Committee is considering the House legislation as well and the full Senate has begun to debate the bill. Congressional leaders hope to complete action on the legislation before the August recess.
SOURCE: CCH Washington Bureau, July 27, 2007.
For more information on this and related topics, consult the CCH® Medicare and Medicaid Guide.
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