Express Lane SCHIP

There’s a website my son showed me called howstuffworks.com. I don’t think what I want to write about today can be found there. However, my thoughts fit into that category. I want to explain how just one provision of the SCHIP bill the President vetoed would have worked and why we insist it is changed.

First, let me make a couple of points. Whoever said “the devil is in the detail,” must have been talking about legislation. This bill was written in consultation with people who knew exactly what their goal was: universal, government-run, taxpayer-financed health care for citizens and non citizens alike in the United States. Second, this bill clearly moved multiple steps toward that end.

The President and I believe every American needs health insurance, but our vision of how to accomplish it is fundamentally different than the Democrats’. We believe government should offer insurance to citizens in hardship, like poor children (Medicaid and SCHIP), and low income adults (Medicaid), like the disabled and elderly (Medicare). However, we believe government can organize the private marketplace so everybody else can choose their own plan, and choose their own doctor and hospital. We believe consumers make better decisions about their health than the government does. We think competition drives quality up and cost down.

Last week, we made clear that we want this program reauthorized and we are willing to assure there is enough money in the budget to cover poor children. What we aren’t willing to do is fund the program with $15 to $18 billion dollars more than is needed. And we don’t believe it is necessary to raise taxes to do it.

Now, back to the devil in the very clever and deliberately hidden details of the vetoed bill. The bill has a basic strategy: Flood the program with money and then build into the language of the bill methods of blowing the doors open for eligibility. In short, use the language of poor children to fill the money bucket up. Then, when taxpayers have committed money, we can expand the population of those who get the benefit to include adults, aliens, and higher income people who have private insurance now.

There are several glaring examples of how this bill was designed to do exactly that. One method used is hidden under the phrase, “express lane” enrollment. This allows states to delegate deciding if people are eligible for SCHIP to others, like schools. It then provides that if the school decides they are eligible for subsidized school lunch they can get Medicaid and SCHIP.

Here’s the really clever part of this camouflage. Schools don’t have any way to enforce eligibility by income or citizenship for subsidized school lunch, let alone SCHIP. If there is any question, they put children into the program. Talk to anybody knowledgeable about school lunch programs and they will tell you, significant numbers of children are deemed eligible for these programs that aren’t.

The school doesn’t even have to have the signature of the family, nor does the family really have to verify income or citizenship status or other important information such as whether the family already has health insurance.

What’s the penalty if a state lets lots of people who aren’t eligible into the program? Virtually none; again, let me explain how the bill would work.

Assume the federal government wanted to check up on a state to assure they are keeping the rules. It is not possible to check every file, so the logical thing would be to pull a scientifically drawn sample of all their enrollees, survey those cases for compliance, drawing conclusions based on the survey for the entire program. If say, a thousand cases are checked, statistically you can predict the compliance of the entire group.

Let’s say, the sample found 200 of the 1000 were falsely allowed in the program, or 20% of the entire program. The law would simply allow the federal government to ask for its money back on the 200 specific cases. But the bill actually prohibits the federal government to make the states accountable for the tens of thousands of cases the sample represents.

In other words, the bill not only makes it easy for ineligible people to get in the program; it also takes away any meaningful penalties for states that put them there. In fact, it creates massive financial incentives for states to do so.

We are all for signing up kids and even signing up kids fast. States can use presumptive eligibility but still maintain the integrity of the program by running a full eligibility determination. States can send eligibility workers with laptops into the schools to take applications, but we should not ask taxpayers to foot the bill for people who are not eligible.

There are many other reasons the President vetoed this bill. I’ll write more later.

SCHIP Response

Last week John E. McDonough responded to my entry on SCHIP by making a couple of statements that are typical of those I’m hearing about SCHIP, so I will respond.

John’s comment: First, though you decry New York State's proposed expansion of SCHIP eligibility to 400%fpl, you and the President ignore the fact that the bipartisan Congressional bill would make it harder for states to expand SCHIP above 300%fpl than it is now.

Answer: Yes, the bill would allow New York to offer SCHIP to families of four making $83,000 or 400% of the FPL, or federal poverty level. We do not think children living in families with that much income qualify as poor. We also believe states should focus on children under 200% of the poverty level before offering coverage to families over 250%. New York for example still has 12% of the children under 200% who don’t have insurance. Yet they now want to expand to cover children at 400%.

As you point out, the vetoed bill does contain a requirement for states to enroll children under 300% equal to the average of the top ten states. We agree there should be a standard of performance before states can expand eligibility. We see the bill's standard as weak. We think it should also measure performance on children below 200% FPL not 300%. I would also point out New York and New Jersey, who have expanded above 300%, are exempted from the requirement.

John’s comment: Second, though you say you care about poor children, you ignore that the vast majority of new funds in the bipartisan Congressional legislation would only help about four million children who are currently eligible for SCHIP and who are not enrolled because state's lack the funding to enroll these children.

Answer: John, of the four million children the sponsors say the bill would help, only 500,000 are currently eligible for SCHIP. Over a million are eligible for Medicaid. In other words, these children are eligible for government insurance and could enroll today. Of the remaining 2.5 million, nearly half already have private insurance (according to the Congressional Budget Office).

Most of the money in this bill isn’t going to pay for newly insured children. The majority of the funding will provide states with better match rates and cover children who are already eligible or have private insurance.

Continuing the SCHIP Debate

I’m falling into a pattern of posting once a week. I have ambitions to do better than that. The reality, however, is if I’m going to keep the commitment I made to write the postings myself, I’m likely to be imperfect in my regularity. I suspect one solution is to write shorter, more frequent postings; something a few readers have properly suggested.

My week has been focused on the reauthorization of SCHIP. This is playing out about the way I expected it would thus far. Some months ago, the Democratic leadership in Congress made clear they were going to send the President an SCHIP bill he would have to veto. Likewise, the President made clear he would veto any bill that didn’t focus on poor children as the primary priority, or that motivated middle income people with private insurance to cancel it to get on a government program. The bill Congress passed violates both principles. So, the President did exactly as he said he would and vetoed it.

Now, the leadership of Congress has decided to put the override vote off for two weeks. During that period we will hear a lot of political rhetoric but in the end the veto will be sustained. When that occurs we can get down to the business of solving this problem. Demagoguery is a politic ritual in situations like this that just has to be endured.

Over the weekend, President Bush made a significant point in his radio address. This isn’t about money; it is about the priorities, accountability and focus of the program. He wants to reauthorize SCHIP with its core mission of helping poor children intact. The Children’s Health Insurance Program isn’t a program for adults; it wasn’t instituted to help children in families with middle or upper incomes.

The policy differences between the two sides are real and more complicated than a duel between two competing budget numbers. President Bush made clear when we can find a solution to our policy differences he is willing to work with Congress in finding additional money, if necessary.

I’m asked regularly, “So what’s the President’s SCHIP budget number; how far is he willing to go?” There isn’t an answer to that question yet, because we aren’t even talking to the other side of the debate. They have chosen to proceed as though the President’s opinion isn’t important. They will likely continue to act that way until after the veto is sustained. This is a dance that occurs whenever controls of the legislative and executive branches of government are held by different parties. Each time there is a shift in the power structure of Washington, the resilience has to be measured. Each time the lesson is the same. It takes both the legislative branch and the executive branch to make a law.

Visit the Every American Insured Web site

Round One on SCHIP

This past week, the process of reauthorizing the State Children’s Health Insurance (SCHIP) bill began.  People wonder how there can be disagreement over a program to help poor children.   There is no disagreement about helping poor children.  The ruckus is more about children who are better off, and a question of governments’ proper role. 

SCHIP was intended to cover poor children; those with family incomes under 200% of the poverty level ($42,000 for a family of four).  The bill Congress passed redefines who is considered poor to include some families of four who make up to $83,000.  Incidentally, a fellow jokingly pointed out to me that many families who make $83,000 a year have to pay a special tax on the rich, called the alternative minimum tax.  “Only in Washington can you be rich and poor at the same time,” he said.

The controversy stems from the fact that most of the children in this income category already have private health insurance.  Late last week, the Congressional Budget Office issued a new financial analysis of the SCHIP bill Congress just passed.  They predict over the next five years, 800,000 children who are currently eligible, but not insured, will enroll in SCHIP.  However, 1.1 million children will DROP PRIVATE INSURANCE so they can enroll at taxpayer expense.  SCHIP should help uninsured poor children get private insurance, not motivate insured children with private insurance to cancel it and move to public assistance.

The President has said he will veto this bill.  Congress will then conduct an override vote, first in the House of Representatives.  I read this morning that:  Roy Blunt, a member of the Republican leadership in the House of Representatives, quoted projecting a 100% probability the veto will be sustained. 

The drama around vetoes and overrides are just the way Washington conducts a conversation and debate.  It generally creates an improved work product.  That will certainly be the case here.

In 1995-1996, I was Governor of Utah and deeply involved in welfare reform.  We went through a similar period of time.  Like today, there had been a change of power in Congress and the parties shared power.  My party, the Republicans, who had just assumed control, acted as if they could pass legislation without the Democrats.  President Clinton vetoed the welfare reform bill a couple of times.  Ultimately, everyone came to understand that accomplishing anything in a divided government requires bi-partisan work.  After a few attempts to simply roll over the Democrats, the Republican leadership got serious about finding compromise.  It appears we’re going through the same experience again but now with roles reversed. 

This debate isn’t about who cares for kids most or just about money.  It’s about different philosophies about the role of government.  Clearly, some people want the federal government to run health care.  They think taxpayers should pay to insure everyone.  Many others (the President and I among them) believe government should help people in hardship (the poor, elderly and disabled) and organize a private insurance market that allows people to choose affordable insurance plans that fit their needs.

Am I saying everyone who voted for the reauthorization bill wants the federal government to insure everyone? No.  For many members of Congress this wasn’t about philosophy or high principle; it was a political calculation.  They simply didn’t want to deal with the vocal and well orchestrated wrath of the advocacy groups who clearly do want Washington run health care, and who see SCHIP as the best chance in years to advance their cause.  These groups wrongly and unfairly paint those who favor reauthorization but not expansion to children in better off homes—as hostile to children.

I talked to several who voted for the bill.  Many of them expect competitive elections in 2008 and knew enough other members of Congress would vote to sustain the President’s veto.  This was a way to “have their cake and eat it too.”  Others who voted for the bill told me their reasoning was essentially this: “If we vote for a bad Senate version of the bill, it will save us from a disastrous House version which was truly over the top expansion.” 

That’s the way Washington works, everybody doing their own political calculus.  This kind of situation is exactly why the founding fathers of our nation provided for a veto.  It is a tool to keep unwise things from occurring when dynamics of politics might propel them forward otherwise.  The President’s veto is the right thing to do.  SCHIP will be a better program in the future as a result.  Ultimately, more people will get health insurance as well, because rather than just moving those who have private insurance to government insurance, we will focus on the uninsured and get on to the bigger discussion of getting every American insured. 

To learn more about our Every American Insured priority, visit www.hhs.gov/everyamericaninsured.

From Montana: 8/16/07

Thanks to all of you who commented and wished me luck. I quickly reviewed all the comments. It’s clear the pandemic influenza blog is still generating conversation.

Several of you expressed interest in Tamiflu being an over the counter drug. I don’t possess the technical background to detail the challenges presented by that idea, however, I feel certain its status as a serious antiviral is a significant barrier.

I can’t remember if I mentioned on the pandemic blog that we are testing various distribution alternatives, including making available medical home kits with personal supplies of various emergency medications. CDC actually designed the kit and we have placed 5,000 of them in homes. We need to assure that families don’t break them open and use the medications etc. in advance of a true emergency. I’m told the first phases of the test have gone well.

We’ve also tested postal service delivery of medications in emergency situations in two cities with a third test scheduled soon. Those have been extremely instructive.

Tonight I’m sitting in a hotel room in Montana. I’ve got the television on in the background. Ironically, Charlie Rose’s program is about pandemic influenza. He has David Nabarro, Jeff Koplin, Larry Brilliant and a couple of others on. It’s a very thoughtful discussion.

My primary reason for being in Montana was to work with Senator Max Baucus. We visited a Boys and Girls Club in Bozeman.

One of the blog comments I read tonight was from Goju who referred to herself as “an ordinary mom,” and said she was glad to have her health care concerns heard. The event I did with Senator Baucus was an opportunity he provided to hear from several “ordinary moms” about SCHIP (State Children’s Health Insurance Program). Their situations were all a little different but all expressed how important it was to them.

They are right; SCHIP needs to be reauthorized before September 30th so no child’s coverage is endangered. There is significant disagreement right now between the Senate, House and Administration on what constitutes a low income child. We need to get reauthorization done and then get on with the question of how we solve the problem for adults and children who aren’t eligible for SCHIP or other programs for those in hardship.

I am a passionate believer that our nation, in a relatively short period of time, could organize a system so that every American could have access to affordable health insurance coverage; a topic for another night.

Friday, I’m headed to Africa. I hope to use this blog to record some of my feelings and experiences.

-Mike Leavitt