Children's Health Care Bill Loaded with Extras

by Julie Rovner - NPR Morning Edition, July 27, 2007
On Capitol Hill, two House committees have begun work on their version of a bill to renew and expand the State Children's Health Insurance Program.

Last week, a Senate committee overwhelmingly approved a bipartisan bill to continue the popular SCHIP program. But in the House, the parties are far more polarized.

Republicans and Democrats on two panels — Energy and Commerce and Ways and Means — said they want to renew the SCHIP program, which otherwise is set to expire at the end of September. But that was about all they agreed on at simultaneous meetings that stretched late into the night on Thursday.

Republicans like former House Speaker Dennis Hastert of Illinois said the bill written by House Democrats expands the children's health program so much that it will substitute government for private coverage.

"Now we're sending messages to families across the country: Drop your private health insurance plans, the American taxpayer will foot the bill," Hastert said.

Democrats like Rep. Henry Waxman of California, however, said the Republican substitute proposal doesn't go nearly far enough.

"With the amount of money they're proposing, they won't even be able to keep pace with current enrollees," Waxman said. "They'd have to drop kids out of the program, let alone cover more of the children that need it."

But differences over how much to expand the children's insurance program are only the start of the dispute — although the expansion alone is enough to have drawn a veto threat from the Bush administration.

What angered Republicans even more is how the bill proposes to pay for the additional $50 billion that would go to the SCHIP program over the next five years. In particular, they object to cuts in spending for private HMOs and other health plans that serve Medicare patients.

Rep. John Shadegg, an Arizona Republican, said that makes no sense.

"So we're going to take money away from our seniors to give it to children in families where those families already earn $82,600 a year?" he asked.

That's not exactly how it would work. That $82,000 represents four times the poverty level for a family of four. Only a few families who earn that much could qualify.

And the money being taken from the private Medicare plans is what budget analysts agree are overpayments. The cuts would simply pay the plans what the average Medicare patient costs.

But the disputes underscore what has become an unfortunate fact that seems to hold true no matter which party controls Congress, says Patrick Morrissey, a health care lawyer and lobbyist and former congressional staffer.

"Unfortunately, nothing is simple in health care these days," he says.

Part of the difficulty is how the Democrats are trying to pay for their health care expansion — using not only the controversial Medicare changes, but an even more controversial 45-cents-per-pack increase in the cigarette tax.

Morrissey says that over the past several years, Congress has also created its own problem in health care, by making Medicare payment policies that last for just a few years at a time:

"So you have this amazing amount of pressure, funneling in to one or two health care bills a year, which means that any one bill, even if it should be noncontroversial, ends up becoming bigger and bigger and bigger," he says. "You literally have dozens and dozens or hundreds of groups lining up saying 'we would like more money, because our payment policy expires at the end of the year.'"

This year, the big money problem is a 10-percent cut in Medicare payments to doctors starting next January. The House bill cancels that cut.

But it comes at a cost — a big one. Eliminating the cut for just two years adds more than $100 billion to Medicare spending over the next decade.

That's considerably more than the entire expansion of the children's health insurance program. And lawmakers had to find the money by trimming payments for other health care providers, who aren't very happy about it.

Still, House Democratic leaders hope to have the bill on the floor next week, their last before the summer break. The Senate bill is expected to come up for a vote next week, as well.
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