Governors ask lawmakers to rescind administration’s guidelines on children’s insurance

Published 6:19 pm Wednesday, February 27, 2008

Three Democratic governors told Congress on Tuesday that the Bush administration has made it virtually impossible for them to expand health insurance coverage to more moderate-income children, and they asked lawmakers to intervene.

The governors said their states seek to enroll tens of thousands of children in government-subsidized health coverage because their families cannot afford private coverage. However, those efforts were threatened by an August directive from the Bush administration.

The directive said states must cover the vast majority of the poorest children already eligible for government coverage — 95 percent — before enrolling higher-income children. A few states have gone to court attempting to void it.

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Massachusetts Gov. Deval Patrick accused the administration of essentially reneging on its commitment to let the state cover families with incomes up to $52,800 for a family of three. Under the guidelines, the income limit is $44,000 for new enrollees.

“Our success depends on the stability and reliability of the commitments the federal government has made to us,” Patrick said. “A retreat in any of those commitments could have devastating effects on our progress.”

Congress has tried unsuccessfully to expand the State Children’s Health Insurance Program.

Last year, lawmakers failed to override two vetoes from President Bush that would have increased federal spending on the program by $35 billion over five years — bringing total spending to $60 billion.

The president said the expansion would have encouraged too many families to drop their private coverage so they could get coverage through the government.

At the hearing Tuesday, two Republican governors voiced concerns that expanding SCHIP to cover more middle-income families would take money from poorer states.

For example, Mississippi only covers children living in families with incomes below twice the federal poverty level — $35,200 for a family of three. Even at that conservative level, the formula used to set SCHIP payments leaves the state $50 million shy of what Congress originally intended, said Governor Haley Barbour.

“I cannot support a bill that shortchanges my state and shortchanges the children of my state,” Barbour said.

Georgia Gov. Sonny Perdue said the South has been particularly successful in covering children through SCHIP, but because funding is based partially on the number of uninsured children, states such as Georgia, Mississippi and North Carolina are penalized.

In all, about two dozen states will have to roll back coverage or stop planned expansions, said Rep. John Dingell of Michigan, the Democratic chairman of the Energy and Commerce Committee.

Congress ended up passing a short-term extension that would let the program continue through March 2009, but Democratic leaders said Tuesday they plan to push for a longer-term reauthorization of SCHIP this year.

While the governors were divided about SCHIP, they were unanimous in asking Congress to stop changes the Bush administration is seeking for Medicaid. The regulatory changes would save about $13 billion over five years. For example, the administration has proposed eliminating payments for graduate medical education, which primarily affects teaching hospitals.

The changes would result in reduced reimbursement rates for providers or reduced services for patients, Barbour said. The administration says that even with the savings, Medicaid is expected to grow more than 7 percent a year.

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