Undermining Children’s Insurance
New York Times, Editorial Board, February 28, 2015
Senior Republicans in Congress are seeking major changes to the Children’s Health Insurance Program when the program’s money runs out in September.
Their proposal, labeled a “discussion draft” for legislation yet to be written, could deprive more than a million children of insurance or force their families to pay higher out-of-pocket costs for their coverage. It also would shift costs to states, which would be left holding the bag to pay for the children’s insurance or for the care of the children as uninsured patients.
The draft is being circulated by Senator Orrin Hatch of Utah, chairman of the Senate Finance Committee; Representative Fred Upton of Michigan, chairman of the House Energy and Commerce Committee; and Representative Joe Pitts of Pennsylvania, chairman of the health subcommittee. It threatens to undermine the progress made in reducing the number of uninsured children, gains that came from enrolling more children in Medicaid and in CHIP, which covers children whose families earn too much to qualify for Medicaid.
The Republican proposal would eliminate the Affordable Care Act’s requirement that states keep the family-income eligibility levels stable until 2019, and it could make it harder for families to prove their eligibility. Faced with a loss of federal funds for CHIP, as suggested in the Republican proposal, many states would probably shrink their CHIP programs and reduce their own financial contributions. A result would be fewer children enrolled in the program. The proposal would also eliminate a requirement that states enroll children who are just above the poverty line in Medicaid. This would enable states to move them from Medicaid back to CHIP, where enrollments are often limited by budget caps.
And the proposal would allow states to impose a 12-month waiting period (up from the current 90 days) before children who lose coverage from a parent’s insurance plan can be enrolled in CHIP. That is a very long time for a youngster to go without insurance and the regular care it provides. Many families in that situation will not be able to afford coverage on the new health care exchanges.
The Republican proposal is billed as a way to let states make “common-sense changes” to their Medicaid and CHIP programs. But instead of helping the states, it could end up costing them a lot of money. It would reduce federal financing of CHIP for families with incomes above 250 percent of the federal poverty level and eliminate federal help for those with incomes above 300 percent of the poverty level. More than two dozen states and the District of Columbia now cover children in one or both of those income groups. The proposal would also eliminate an increase in the federal matching rate for CHIP that is scheduled to go into effect in 2016 in all states.
By contrast, bills introduced in the House and Senate by Democrats would extend federal CHIP financing for the next four years and largely continue the program along current lines. That is the better approach. Governors should lean on Congress to extend this valuable children’s program without major changes.
