Rules May Limit Health Program Aiding Children

By ROBERT PEAR - The New York Times - August 21, 2007
The Bush administration, continuing its fight to stop states from expanding the popular Children’s Health Insurance Program, has adopted new standards that would make it much more difficult for New York, California and others to extend coverage to children in middle-income families.

Administration officials outlined the new standards in a letter sent to state health officials on Friday evening, in the middle of a monthlong Congressional recess. In interviews, they said the changes were intended to return the Children’s Health Insurance Program to its original focus on low-income children and to make sure the program did not become a substitute for private health coverage.

After learning of the new policy, some state officials said yesterday that it could cripple their efforts to cover more children and would impose standards that could not be met.

“We are horrified at the new federal policy,” said Ann Clemency Kohler, deputy commissioner of human services in New Jersey. “It will cause havoc with our program and could jeopardize coverage for thousands of children.”

Stan Rosenstein, the Medicaid director in California, said the new policy was “highly restrictive, much more restrictive than what we want to do.”

The poverty level for a family of four is set by the federal government at $20,650 in annual income. Many states have received federal permission to cover children with family incomes exceeding twice the poverty level — $41,300 for a family of four. In New York, which covers children up to 250 percent of the poverty level, the Legislature has passed a bill that would raise the limit to 400 percent— $82,600 for a family of four — but the change is subject to federal approval.

California wants to increase its income limit to 300 percent of the poverty level, from 250 percent. Pennsylvania recently raised its limit to 300 percent, from 200 percent. New Jersey has had a limit of 350 percent for more than five years.

As with issues like immigration, the White House is taking action on its own to advance policies that have not been embraced by Congress.

In his budget in February, President Bush proposed strict limits on family income for the child health program. Both houses of Congress voted this month to renew the program for five years, but neither chamber accepted that proposal. Legal authority for the program expires on Sept. 30.

The administration’s new policy is explained in a letter that was sent about 7:30 p.m. on Friday to state health officials from Dennis G. Smith, the director of the federal Center for Medicaid and State Operations. The policy would continue indefinitely, though Democrats in Congress could try to override it.

The Children’s Health Insurance Program has strong support from governors of both parties, including Republicans like Arnold Schwarzenegger of California, Tim Pawlenty of Minnesota and Sonny Perdue of Georgia. When the Senate passed a bill to expand the program this month, 18 Republican senators voted for it, in defiance of a veto threat from Mr. Bush. The House passed a more expansive bill and will try to work out differences with the Senate when Congress reconvenes next month.

In his letter, Mr. Smith set a high standard for states that want to raise eligibility for the child health program above 250 percent of the poverty level.

Before making such a change, Mr. Smith wrote, states must demonstrate that they have “enrolled at least 95 percent of children in the state below 200 percent of the federal poverty level” who are eligible for either Medicaid or the child health program.

Deborah S. Bachrach, a deputy commissioner in the New York State Health Department, said, “No state in the nation has a participation rate of 95 percent.”

And Cindy Mann, a research professor at the Health Policy Institute of Georgetown University, said, “No state would ever achieve that level of participation under the president’s budget proposals.”

The Congressional Budget Office has said that the president’s budget, which seeks $30 billion for the program from 2008 to 2012, is not enough to pay for current levels of enrollment, much less to cover children who are eligible but not enrolled.

When Congress created the Children’s Health Insurance Program in 1997, it said the purpose was to cover “uninsured low-income children.” Under the law, states are supposed to make sure public coverage “does not substitute for coverage under group health plans.”

In an interview yesterday, Mr. Smith said, “The program was always meant for children in lower-income families.” As a state increases its income limits, he said, “it’s more likely to substitute for private coverage.”

To minimize the risk of such substitution, Mr. Smith said in his letter, states should charge co-payments or premiums that approximate the cost of private coverage and should impose “waiting periods” to make sure middle-income children do not go directly from a private health plan to a public program.

If a state wants to set its income limit above 250 percent of the poverty level — $51,625 for a family of four — Mr. Smith said, “the state must establish a minimum of a one-year period of uninsurance for individuals” before they can receive public coverage.

That is considerably stricter than past requirements. In February, for example, the Bush administration allowed Pennsylvania to increase its income limit to 300 percent of the poverty level after the state agreed to a six-month waiting period for children who were 2 and older with family incomes exceeding 200 percent of the poverty level.

As another precaution, Mr. Smith said, states that want to cover children above 250 percent of the poverty level must show that “the number of children in the target population insured through private employers has not decreased by more than two percentage points over the prior five-year period.”

In New Jersey, which has a three-month waiting period, Ms. Kohler said, “we have no evidence of a decline in employer-sponsored coverage resulting from the Children’s Health Insurance Program.”

In the Senate debate this month, several Republicans offered a proposal similar to the new Bush administration policy. They wanted to require states to cover 95 percent of low-income children before allowing states to expand eligibility.

Senator Max Baucus, the Montana Democrat who is chairman of the Finance Committee, argued against the proposal, saying: “No state can meet 95 percent. No state currently meets 95 percent.”

In his letter, Mr. Smith said the new standards would apply to states that previously received federal approval to cover children with family incomes over 250 percent of the poverty level. Such states should amend their state plans to meet federal expectations within 12 months, or the Bush administration “may pursue corrective action,” Mr. Smith said.

Two Republican senators, Charles E. Grassley of Iowa and Pat Roberts of Kansas, urged the Bush administration last week to deny New York’s request to cover children with family incomes up to four times the poverty level. The proposal, they said, violates the original intent of Congress.

But Gov. Eliot Spitzer of New York said that, “contrary to the senators’ objections,” federal law allows states to set higher income limits. “Granting this expansion,” Mr. Spitzer said, “is essential to the health and well-being of New York’s children.”

Read more in The New York Times

Studies say Texas lags in health care access

With high number of uninsured, state ranks 49th in one study
By JASON ROBERSON and ANGELA SHAH - The Dallas Morning News - Thursday, June 14, 2007

To many people, Texas has a strong reputation for quality health care.

Retirees who move to the state cite good hospitals as a key attraction. Dallas' Baylor University Medical Center and UT Southwestern Medical Center are renowned for churning out top-notch doctors. The University of Texas M.D. Anderson Cancer Center in Houston attracts patients from around the world.

But among the 50 states, Texas' health care system ranges from average to poor,

according to two reports released this week.

Industry experts say

the low rankings are explained largely by the widening gap between Texans who have health insurance and those who don't.

The large immigrant population and a high number of small businesses that don't offer health benefits to employees make Texas highest in the nation in the percentage of uninsured residents.

That helped rank Texas 49th out of 50 states and the District of Columbia for the overall performance of its health care system, in a study by the Commonwealth Fund, a nonprofit health care advocacy group. The study measured access to health care, quality of health care, avoidable hospital costs and deaths per 100,000 residents.

"We have too much pride in this state, and too much good economy, for us to sit back and tolerate this kind of rating," said Ladon W. Homer, immediate past president of the Texas Medical Association.

If Texas improved to the level of Hawaii, the best-performing state in the Commonwealth study, 2.7 million adults and 900,000 children would be insured, and the state would save $250.3 million a year, the study's researchers concluded.

A study released Monday by the U.S. Department of Health and Human Services pegged the state as average for health care quality, based on 129 indicators.The department began publishing the annual study in 2005 as a way to help state health leaders better recognize their strengths and weaknesses in providing quality care.

"Texas on overall quality is about average," said Ed Kelley, supervisor of the department's study.

"There are some things Texas is doing well and challenges that can be improved."

For example, the study found that Texas scored strongly for early colorectal cancer diagnoses and having a low percentage of nursing home residents who are depressed or anxious but poorly in areas such as full vaccination of children and avoidable hospitalizations for diabetes.

In both studies, Midwestern and Northeastern states such as Wisconsin, Minnesota, New Hampshire, Vermont and Maine performed the best. Those states have higher percentages of residents with health insurance and don't have the same impact from immigration as Texas does.

Many uninsured

In a state with 23.5 million people, more than 5.5 million – including 1.4 million children – lack health insurance,

according to the Texas Medical Association. Texas'

uninsured rates are about 1.5 times the national average.

Texas stands out for the ethnic makeup of its uninsured,

said Anil Kumar, an economist with the Federal Reserve Bank of Dallas.

Hispanics make up a third of the state's population – much larger than the 13 percent for the U.S. as a whole. More than half of the uninsured in Texas are Hispanic, compared with 25 percent for the nation.

Many Hispanics, particularly laborers, work at small businesses, said Roger C. Rocha Jr., state director of the League of United Latin American Citizens.

"Low-income people who cannot afford health insurance are in jobs that don't offer health insurance,"

he said.

"And then with CHIP programs being cut or not being funded adequately, there is a big segment out there not covered."

Only 55 percent of Texans have access to employer-sponsored insurance, below the national average of 63 percent, according to the Texas Medical Association. For small businesses – which provide about half the state's nonfarm, private-sector jobs – coverage drops to 37 percent.
...
Strain on hospitals

The strain of supporting uninsured Texans pressures hospitals financially and in the quality of care, experts say.

Total uncompensated care – including bad debt from people who can't pay their bills and charity care that hospitals agree to provide – increased 78 percent, from $5.6 billion in 2001 to $10.1 billion in 2005,

according to the Texas Hospital Association.

Uninsured patients are more likely than their insured counterparts to forgo or delay treatment for acute illnesses or injuries, to go without needed treatment for chronic conditions or illnesses and to die prematurely.

Besides the dangers to those who go without insurance, the situation also creates a drag on the state's economy,

said Nancy Williams, president of the Health Industry Council of the Dallas-Fort Worth Region.

Uninsured patients create higher health care costs for everyone as a result of the inherent cost shifting.

"The uninsured is an issue because the insured can't handle it,"

Ms. Williams said.

A study by Families USA, a Washington-based nonprofit group that advocates for universal health care, found

in 2005 that employer-sponsored family coverage in Texas costs $1,551 more per year as a result of the uninsured.

The problem of the uninsured is again getting attention from politicians. Presidential candidates are floating proposals to increase the ranks of insured Americans and even to provide universal health coverage.

Massachusetts is rolling out a plan that will cover nearly all of its residents. Politicians in California, New York and Pennsylvania are talking about doing the same.

In Texas, solutions have come in a more piecemeal fashion.

In the recent legislative session, lawmakers restored many of the funding cuts made in 2003 to the Children's Health Insurance Program. CHIP is designed for children of families who earn too much for Medicaid but not enough to buy private health insurance.

Since the cuts, CHIP enrollment had dropped from a high of 529,000 in May of 2002 to 300,800 this month,

according to the Texas Health and Human Services Commission.

Lawmakers also agreed to settle a Medicaid-related lawsuit by spending $707 million to increase dentists' payments by 50 percent and physicians' 25 percent, and to dispatch up to 40 mobile labs into inner-city neighborhoods and impoverished colonias.

Mr. Homer, the former TMA president, said

the state was funding two-thirds of the actual cost of Medicaid – "which means many physicians opt out of this program, which means more people don't have access to health care."

Read more