State Children's Health Insurance Program (SCHIP)
Topic Primer Sections
In 2007, Congress worked on a health package that reauthorized the State Children's Health Insurance Program (SCHIP) for 18 months and halted a scheduled 10 percent cut in physician payments from taking place for six months. The NRHA was actively involved in these efforts. As 2009 begins, SCHIP is again set to expire. The NRHA is working to ensure the continuation of SCHIP so that all rural children have access to the benefits of health insurance and the high quality health care that our rural providers provide.
Updates
January 15, 2009 - Senate Finance Committee approves SCHIP extension; heads to Senate Floor
Legislation to reauthorize and expand SCHIP is headed to the Senate floor, after the Senate Finance Committee approved a draft bill by a vote of 12 to 7. Finance Committee Republicans complained that while the original draft bill hewed closely to previously passed SCHIP bills during the 110th Congress, ammendments, such as a provision to relax eligibility standards for legal immigrants and new citizens, were inappropriate and spoiled previous bipartisan compromises. Senate Democratic leaders are expected to modify the bill before it heads to the floor to more closely align with the House bill, which may lead to more Republican objections. The NRHA anticipates Democrats still have enough votes to pass the SCHIP extension next week.
January 14, 2009 - House votes overwhelmingly for SCHIP extension
By a vote of 289 to 139, the House passed H.R. 2, the Children's Health Insurance Program Reauthorization Act of 2009 (CHIPRA). The bill is very similar to two House bills during the 110th Congress that led to Presidential vetoes. A very different fate is expected to await CHIPRA this time as Congressional leaders expect and plan that this will be one of the first pieces of legislation that President-elect signs when he assumes office on January 20th.
December 29, 2007 - President Bush signs extension into law
The Medicare, Medicaid, SCHIP Extension Act of 2007 (S. 2499) has been signed into law. The bill extends the SCHIP program for 18 months at fairly level funding, protects providers paid by Medicare a 10 percent payment cut until July 1, 2008, and extends key rural provisions for that same six-month period. The bill is not as sweeping as many children advocacy organizations or NRHA would have liked. Level funding leaves millions of children without insurance. Six months means that NRHA and others will spend 2008 working to simply extend current Medicare policy. But it was an exhaustive process, and the compromise legislation guarantees health care access to millions of rural Americans. We thank Congress and the administration for ending the year in a positive way and we look forward to working with them both in 2008 to improve the health of rural America.
SCHIP
The NRHA strongly supports reauthorization and expansion of the State Children's Health Insurance Program (SCHIP). The program was established in 1997 as a way to provide insurance to children that did not qualify for Medicaid. The NRHA has supported the program since that time. If Congress does not reauthorize the program before October 1, the program will disappear.
Rural children disproportionately rely on SCHIP and Medicaid. A Spring 2007 Carsey Institute Study found that 32 percent of rural children are enrolled in SCHIP or Medicaid compared to 26 percent of urban children. In addition, more than 1.3 million rural children are still uninsured. We must do better.
The NRHA is advocating to Congress:
- Reauthorize the program.
- Provide enough additional dollars to insure all eligible children.
- Create a rural grant program to increase outreach and enrollment in rural parts of the country.
Medicare Advantage
The two most likely offsets or pay-fors for this health package are a tobacco tax increase and cutting Medicare Advantage payments. The NRHA has never taken a position on tobacco use. The NRHA does, however, believe that Medicare Advantage (MA) in the current setup is not working as well as it could with regulatory and legislative adjustment.
We do support the rationale for MA overpayments, as previously enacted through higher rural floors. Rural beneficiaries have always received fewer benefits than their urban counterparts whenever Congress has attempted to involve the insurance industry in Medicare programs. In both Medicare+Choice and Medigap models, rural elders are under-enrolled and receive fewer benefits. The NRHA felt that such overpayments, to encourage plans to provide rural plans, would be a beneficial use of tax payer money.
It appears that this is not working. A RUPRI policy brief from April revealed that despite significant growth in MA plans, only 5.6 percent of rural beneficiaries were in these plans. Forty-four percent of those beneficiaries were in private fee-for-service (PFFS) plans, which have raised significant concerns in the rural provider community, compared with only eight percent of urban beneficiaries. Subsequent unpublished data indicates similar discrepancies on whether rural seniors are receiving the extra benefits.
In addition, the NRHA is concerned that plans, especially PFFS plans, are not paying attention to the sensitive nature of the rural health safety net. Rural providers are not being paid their fair rate in a timely manner. In addition, plans are shifting additional administrative burdens on to providers by delaying payments and refusing to be honest with enrolled seniors. We believe the program has serious concerns that need to be addressed. A few of these include:
- Plans provide fair reimbursements to rural providers in amounts no less than they would be paid by traditional Medicare;
- CMS engages with rural health experts regarding how to determine and enforce rural community access standards;
- Provide the Federal Office of Rural Health Policy with expanded authority to provide technical assistance and outreach on ways rural providers can collaborate in the review of MA contracts;
- State Insurance commissioners should be empowered to provide oversight of plans; and
- Companies should be restricted in the number of plans they offer to beneficiaries by CMS because a large array of choices has the effect of confusing beneficiaries, making it difficult for them to make rational choices.
If Congress chooses to reduce Medicare Advantage funding, the money should be reinvested in rural America. Health care access is the priority for rural seniors. Protecting the fragile rural health care safety net needs to be the priority of Congress.
Additional resources:
- NRHA policy paper on Medicare Advantage from February
- Data on MA beneficiaries by state is available from the RUPRI Center, to be published in a forthcoming Policy Brief.
If you have additional questions or comments, please contact the NRHA Government Affairs Office at 202-639-0550.
