States Decry Children's Insurance Policy

The Guardian reports:

State health officials are decrying new federal guidelines that require many children to be uninsured for a full year before they have access to government-subsidized coverage.

Waiting periods prevent families from dropping private insurance to get cheaper or better coverage for their kids through the State Children's Health Insurance Program, or SCHIP.

But the vast majority of states require much shorter waits - typically one month to six months - than the Bush administration will require. Only Alaska has a one-year wait; in 16 states, there is no waiting period.

State officials say the policy could prevent pregnant women from having health coverage during any portion of their pregnancy or it could keep children from obtaining insurance even if a parent has died or lost a job.

``It would actually increase the number of uninsured children,'' said Deborah Bachrach, deputy commissioner in New York's Office of Health Insurance Programs. ``We think it's bad policy.''

New York has applied to expand its program coverage to families with incomes up to 400 percent of the poverty level - a threshold that many say the program was not intended to serve. Under the New York policy, a family of three earning as much as $68,680 could participate.

In its request to expand eligibility, the state said it would enact a six-month waiting period. Currently, the state has none.

The one-year wait is ``simply unconscionable,'' Bachrach said. ``New York could not agree to that.''

Many of the state Medicaid directors who participated in a conference call Wednesday to discuss the guidelines were upset.

``Not having any coverage for a year flies in the face of the health care reform efforts the states have been undertaking,'' said Martha Roherty, director of the National Association of State Medicaid Directors.

The one-year minimum applies to states that extend program coverage to more moderate-income families - specifically, to families whose income exceeds 250 percent of the federal poverty level, or $43,925 for a family of three.

It is estimated that 18 states and the District of Columbia are in that category or have plans to expand coverage to at least that level.

Dennis Smith, who oversees the Medicaid program at the Centers for Medicare and Medicaid Services, spelled out in a letter last week several new requirements the administration planned for those particular states. The new requirements were first reported by The Associated Press.

Smith said states that use the children's insurance program to cover families above 250 percent of the poverty level must make some assurances to prevent the substituting of public insurance for private plans.

The program subsidizes the cost of health insurance for families whose incomes are too high to qualify for Medicaid but too low to afford private insurance. Both the Senate and the House passed bills this summer that would increase substantially the spending on the program. Bush has promised to a vet if they reach his desk in their current form.

Several states have lowered their waiting period since the program began a decade ago. Georgia and Florida are the only states to increase theirs. Both states require children to be uninsured for six months before they can enroll.

Connecticut dropped its waiting period from six months to two months. New Jersey has dropped its waiting period twice - it now is three months - and allows for exceptions.

``We think it's very bad public policy to prohibit children from coming onto our program,'' said Ann C. Kohler, deputy commissioner of the New Jersey Department of Human Services. ``There's absolutely no evidence that people are dropping their private coverage to go on SCHIP.''

The Congressional Budget Office said this year the program does result in some substitution of private insurance for public insurance. For every 100 children who enroll, there is a corresponding reduction in private coverage of between 25 and 50 children.

Other states that would be affected by the new guidelines include Maryland and Massachusetts, which have six-month waiting periods. In Minnesota and the state of Washington, children have to be uninsured for four months before they can participate. Vermont has a one-month wait. Rhode Island has none.

Vermont Gov. James Douglas, a Republican, was highly critical of the guidelines.

``I am disappointed and dismayed by the Bush Administration's recent actions regarding SCHIP and by the shortsightedness that seems to continually emanate from Washington,'' said Douglas.

A Heartless "Philosophy"

At CommonDreams.org, Robert Weissman writes:

After six-and-a-half miserable years, it is hard to tally up the worst abuses of the Bush administration.Narrow the field, and focus only on abuses related to the economy. That’s the universe of all the favors that the Bush-Cheney cabal has done for Big Business, so it is still a very competitive contest.

A case can be made that the administration’s effort to block expansion of the State Child Health Insurance Program (SCHIP) should top the list.

SCHIP is a complement to Medicaid, and provides health insurance to uninsured children from low-income families, typically those making up to 200 percent of the poverty line ($34,000). It has had enormous success in its 10 years of existence. Four million children receive health insurance through SCHIP. It has reduced the number of children in families at or slightly above the poverty line who are uninsured by about a quarter.

This has very real and concrete meaning. As the Center for Budget and Policy Priorities has shown, children with insurance get more preventative care, get better treatment for chronic conditions like asthma, have far fewer unmet medical needs, and get better dental treatment.

SCHIP is now up for reauthorization. Because of medical inflation, the program needs more money to provide insurance to the same number of kids. Because the program has been a clear winner, members of Congress from both parties want to provide this needed funding, and to expand the program further.

But President Bush says no.

He has a “philosophical” objection to expanding SCHIP.

“I believe government cannot provide affordable health care,” Bush said at a media event last week. “I believe it would cause the quality of care to diminish. I believe there would be lines and rationing over time. If Congress continues to insist upon expanding health care through the SCHIP program — which, by the way, would entail a huge tax increase for the American people — I’ll veto the bill.”

Here’s what is most remarkable about this philosophical objection from the White House: It isn’t shared by the for-profit insurance industry.

Last week, the Senate Finance Committee, by a 17-4 vote, approved a reauthorization of SCHIP that would enable the program to cover an additional 4 million children without insurance. Most of these children — 85 percent — would already be eligible under existing standards, but would not be covered for lack of funds. The Senate proposal is funded by a 61-cent-a-pack cigarette tax increase, which would have health benefits of its own: deterring almost two million children from taking up smoking, encouraging more than a million adult smokers to quit.

America’s Health Insurance Plans (AHIP), the trade association for the health insurance industry, “supports the Senate package,” says Mohit Ghose, AHIP Vice President of Public Affairs.

“Kids coverage come first” in the effort to get all Americans covered, he says.

Isn’t it strange that the administration is trying to protect the industry, but your position is supportive of the Senate approach?

It’s about a “philosophical point,” not protecting the industry, says Ghose.

“I defer to the White House on what is government-run healthcare.”

The Bush administration’s position is that an expansion of SCHIP will mean that some covered children otherwise would have received private insurance, and that the government program will therefore “crowd out” private insurance.

It is true that, under the Senate program, about a third of kids newly covered would otherwise have had private insurance. But as the Center for Budget and Policy Priorities emphasizes, this is unavoidable (if you are in fact trying to avoid it): the patchwork nature of U.S. private health insurance makes it impossible to cover any group outside of the very poorest and not also provide coverage to some who would otherwise have some private insurance. Moreover, says the group’s Matthew Broaddus, any parent switching their child from private insurance to a public program is doing so either because they have to pay too much out-of-pocket, or because they think they can get better care from the public program.

Where the private insurance industry does line up with the administration is in opposing a bolder plan moving forward in the House of Representatives. The House plan would cover more uninsured children, which does start to worry AHIP, and it would pay for the expansion both with a cigarette tax and by collecting excess payments to private insurers in the misnamed Medicare Advantage program. Medicare Advantage lets seniors opt for a private insurance plan in lieu of traditional Medicare. These private plans are collecting at least 12 percent more per covered person than it costs to treat a person under Medicare. The industry is adamantly opposed to efforts to stop these overpayments.

As against expanding SCHIP, the administration proposes a preposterous tax credit to help pay for individual insurance coverage. Because individual insurance coverage is both the least efficient component of the health insurance market and the one most rife with abuse, it is a certainty that the administration plan would be a failure.

One benefit of having already suffered through the long reign of President Bush is that he no longer commands the authority he once did. The vast majority of people in the United States oppose his position and — in a change — a strong majority in Congress oppose him, as well.

But will Bush veto SCHIP expansion? Will enough Republicans break from the administration to override (or prevent) a veto? That depends on how loudly the public insists its elected officials choose healthcare for kids over twisted philosophies.

Take action now via the Families USA website.

Robert Weissman is co-director of Essential Action, a corporate accountability group based in Washington, D.C. that focuses especially on international issues and has been very involved in the access to medicines campaign. He is also editor of Multinational Monitor magazine. With Russell Mokhiber, he is editor of a weekly column, Focus on the Corporation.