The Senate on August 2, 2007 approved a $35 billion, five-year expansion and renewal of the State Children's Health Insurance Program by a 68 to 31 vote. The legislation (HR 976) would maintain coverage for more than 6 million children and expand coverage to an additional 3 million children. The existing SCHIP program expires September 30.
The Senate's program would be paid partly with a 61-cent increase in cigarette taxes (to $1 per pack) and increases on other tobacco taxes. President Bush, who has threatened a veto, has proposed a $5 billion expansion above the $25 billion baseline and a five-year extension of the program. Bush has said the Senate plan would benefit families far above the poverty level and would cause many insured people to switch to the program. He favors tax breaks and credits instead.
The Senate defeated several GOP amendments, including an amendment to exclude individuals with alternative minimum tax liability from eligibility for SCHIP coverage and one to require individuals who are eligible for SCHIP and employer-sponsored coverage to use the employer-sponsored coverage instead of SCHIP.
The House approved broader legislation, the Children’s Health and Medicare Protection Act (HR 3162), on August 1. That bill would extend the program for five years at a cost of $50 billion above baseline, would raise cigarette taxes by 45 cents per pack and would institute several changes to the Medicare program as well as reduced payments for Medicare Advantage plans. The chambers are expected to begin resolving their differences after the August recess.
The Senate bill would discontinue coverage for most adults, allowing continued coverage for pregnant women. States offering mental health benefits would be required to cover them on a parity with medical and surgical services. A contingency fund for unforeseen emergencies would be created, and grants would be available to states to strengthen and improve access to dental coverage for children. States would be permitted to verify citizenship through matching Social Security numbers as well as at application. The allotment formula would be changes to reflect projected spending.
The Senate also would strengthen outreach efforts by adding authority for agencies to use information from the food stamp program and other services to find and enroll eligible children. Additional funding would be made available to target enrollment of Native Americans and to reduce racial and ethnic disparities in healthcare coverage.
The House bill 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 such coverage through multiple delivery arrangements including an HMO and PPO.
Medicare provisions
The bill also would include new preventive benefits under Medicare, eliminate cost-sharing for preventive benefits and reduce Medicare’s 50% co-payment on mental health outpatient services and add additional mental health providers to Medicare. It 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.
In addition, the bill would eliminate the impending 2008 and 2009 physician fee cuts (projected to be 10 percent and 5 percent, respectively) and put in place a .5 percent update both years. It would phase out MA overpayments over four years to 100% of fee-for-service in 2011 and 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.
SOURCE: CCH Washington Bureau, Aug. 2, 2007.
For more information on this and related topics, consult the CCH® Medicare and Medicaid Guide.
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