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President George W. Scrooge is working like crazy to put the kabash on the SCHIP bill due in Conference Committee upon Congress’ return to Washington.  As discussed previously, both houses of Congress have passed bills that will increase funding for SCHIP (Children’s Health Insurance Program).  The House bill calls for an increase of 50 billion dollars and the Senate bill calls for increases of 35 billion dollars. 

George’s vow to veto any bill that proposes more than a five billion dollar increase has the White House looking pretty chintzy.  It’s kids after all. And the funds Congress is attempting to tap to pay for the increase is tobacco and the bonus money that the feds pay insurance to handle Medicare Advantage plans.  So, in addition to this assault on big business, poor George is faced with a private to public transfer of health care rather than the public to private scenario that he and the Republicans prefer.

What would Scrooge do? Well the answer is “take it below the radar”. Contained within the budget that the Administration sent to Congress in February were stricter means guidelines for the child health program. While Congress has not yet accepted that proposal, the current authority for the children’s program is set to expire on September 30.  Action is pending on the SCHIP.  What to do?  Fiddle with the means testing, of course.  New administration policy, sent to state health officials on August 18, contains new standards for states that want to raise eligibility above 250% of the poverty level, $51,465 for a family of four. The Administration contends that as states raise their definition of poverty level, more children who have previously been privately insured become eligible for the public program, and have devised the following set of criteria for enrolling participants in the program.

1) To raise the eligibility, the states must show evidence that they have enrolled at least 95% of children in the state who are eligible for Medicaid or SCHIP because of being below 200% of the federal poverty level. 
2) If a states sets it eligibility requirement above 250% of the poverty level, the state must establish a minimum of one-year period of uninsurance for individuals before they can receive the public coverage.
3) States that wish to cover children above the 250% limit 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”.

.State officials across the country argue that these guidelines are impossible to meet and could cause serious havoc with the programs and cripple the effort to insure more children. Several states, notably New York and California have previously received federal permission to insure children with family incomes that exceed the poverty level, and in the case of New York, by up to 400%, $82,600 for a family of four.  The Administration contends that the states that have previously received approval to cover children over 250% of the poverty level must amend their state plans to meet the new expectations within 12 months or face “corrective action”.

Congress will surely proceed with the conferencing of their bills in September.  The shape of the bill that emerges may not be as important as it would seem if states are going to be hamstrung in utilizing the increased funding.  A presidential veto might not even be required to limit program enrollment.  And Scrooge could come out smelling like a rose.