The Prologue For 11/16/09: A Needed Debate On CHIP

Photo by Mark Murrmann of ZUMA Press

Way back in February of this year, Democrats of all shapes and sizes had everyone right to be happy when President Obama extended CHIP (or SCHIP) , the Children's Health Insurance Program, to a five year, $33 billion extension.

The program, vetoed twice Obama's embarrassment of a predecessor , was salvaged under a new Democratic role and those who wouldn't put petty politics over the health of the nation's children.

Now, nine months after that jovial day, CHIP's future after its current contract is in serious doubt.

In the midst of the ever changing news with regards to the House and Senate health care bill throughout the year until now, the story of CHIP has been neglected by most in the news world.

The Washington Independent's Mike Lillis is in the minority of that crowd. And his articles about the status of health coverage for America's youth is certainly valuable.

Today, Lillis writes about CHIP's current status in D.C. right now. And even after Jay Rockefeller saved it in the Senate bill by reauthorizing it in the Finance Committee's disaster of the bill by 2019, the program geared to for the kids is not in the final House bill that passed last week.

Instead, another option by House Democrats as a whole has been selected:

The House bill would both expand Medicaid and dismantle CHIP, sending some kids currently covered under the program into Medicaid plans and others into private plans on the exchange.

Supporters of the House proposal argue the advantages of centralizing control over CHIP coverage. Because CHIP is managed by states, there is a fear among some lawmakers that lean economic times could lead to sharp CHIP cuts in some spots, leaving those kids without any coverage at all. Those fears were almost realized earlier this year when California, facing a severe budget squeeze, temporarily froze new CHIP enrollment. Some health policy experts have pointed out that it’s probably not a coincidence that many House Democrats pushing the CHIP repeal are from California, including Speaker NancyPelosi, Rep. George Miller, who chairs the Education and Labor Committee, and Rep. Pete Stark, who heads the Ways and Means health subpanel.

Another reason for California liberals to love the Governator, isn't it? No kid was reportedly kicked off CHIP in Cali land that was already apart of the program. But for the other little ones on the opposite end of that spectrum, it certainly was and still is troubling news for their parents who are struggling to afford coverage for their children.

And that leads the question as to whether families under these new exchange models in 2014 will have their payments skyrocket for their kids? Based on some reports, that seems to be the case:

Stan Dorn, senior health policy researcher at the Urban Institute, said there are certain advantages to scrapping CHIP. Both Medicaid and exchange plans, for example, would never require congressionalreauthorization — a process CHIP is subjected to every few years, he pointed out. But due to CHIP’s affordability, Dorn said “it’s clear” that kids “are much better off” under CHIP than they would be under private exchange plans.

“It’s not even a close question,” Dorn said during a children’s health care forum on Capitol Hill Friday.

Studies suggest Dorn’s concerns are valid. One analysis, conducted by Watson Wyatt Worldwide, an actuarial research firm, found that families living between 175 and 225 percent of the federal poverty level pay just 2 percent or less of treatment costs under CHIP. Under the proposed exchange plans, researchers found, those same families would pay up to 35 percent of their children’s health costs.

Nate Checketts, director of Utah’s CHIP program, noted that the move to more expensive exchange plans would only discourage low-income families already pinching pennies in the economic downturn. “Unless there’s a mandate, I don’t think those low-income families will sign up for it,” saidChecketts.

Now the argument as to letting CHIP go, besides certain States like California gutting it thanks to its respective budget problems, is the fact that all families can focus on one plan for their entire "clan" instead of a separate thing all together with CHIP.

Rep. John Dingell (D-Mich.) has also defended the plan to terminate CHIP, arguing in a recent email that “enrollment of kids increases when the entire family can be enrolled under one plan.”

Checketts agrees, pointing out the difficulties that can arise when family members’ health coverage is scattered across different programs. “It is a good goal,” he said, “to get families on a single source of coverage.”

But the key factor in all of this, and why I feel that just dumping kids to private insurers (oh boy with that one and all) with increased payment in comparison to the current model is this:

Yet some analysts have concluded that affordability is the more significant factor to ensuring coverage.

AS ALWAYS.

It doesn't matter if you get coverage. What matters at the end of the day is whether you can afford that coverage. And that is a telling sign of justified concern if CHIP cannot be retained here and possibly made into a national model where States won't have enrollment freezes on providing kids affordable coverage for their families strapped for cash.

In one of the rare instances, the Senate may have this one right over the House, even with House Democrats being very cautious on the transition away from CHIP to the amalgamation of Kids Medicare and that dreaded private insurers hands.

Dawn Horner, senior project director at Georgetown University’s Center for Children and Families, an advocacy group, applauded some of the CHIP proposals contained in the House bill. The provision to keep CHIP-funded Medicaid patients in the Medicaid program, for example, is a step above the Senate proposal, she said. Also, the House bill has better affordability protections for kids on the exchange, Horner added. The combination makes it difficult to determine whether CBO’s analysis of the Senate bill holds for the House proposal, she said.

As one person said in the comments at TWI, that alarming "devil is in the details" quotation rings its bell again.

That supposed 35% increase in the House bill for kids coverage in the new exchange is dubious with the fact that under the House Bill, preventive care and well baby/child care all come with no cost sharing at all.

Still, it is a debate that is certainly needed to be had right now. Because all the attention and praise for CHIP's resuscitation way back in the cold winter of the incipient stages of 2009 will mean nothing five years from now, if children across this nation struggle to get access to proper health care.