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Finding a Solution

Brad Cain, for Health Plan Insider, November 28, 2007

Congressional leaders return to Washington next week to resume negotiations on a number of important issues, but one that should be elevated to the top of every representative's list is finding a solution that keeps the State Children's Health Insurance Program functioning. Set to expire earlier this fall, short-term extensions have kept the program on life-support while President Bush and Congressional Democrats have faced off over a formal reauthorization. The parties have been at loggerheads over how much latitude states should have in using in the program to expand coverage beyond its core focus--low-income, uninsured children.

Democrats have held fast on an expanded program that would give states more leeway to cover up to 10 million children, while the Administration has stood behind its plan on limiting expansion and focusing first on covering children in families who earn the least.

Congress will have a tight window in which to address the SCHIP issue, as the temporary funding is due to expire on December 14. It could authorize another stopgap measure, but the uncertainty over future funding is already having an impact at the state level. The agency running California's SCHIP program--Healthy Families--is preparing to halt new enrollments and to begin moving children out of the program due to projected budget shortfalls.

The agency approved the contingency plan earlier this month, but held off implementing it while Congressional negotiators continued their work. But time is running out. The agency will consider putting the plan into motion next week and actual disenrollments could start by the end of the year.

Such a move would have nearly 60,000 children starting out 2008 by losing their healthcare coverage--a scenario the state says would be replayed each month until nearly 600,000 children are kicked out of the program. California is not alone in the mess.

The Congressional Research Service estimates that 21 states will run out of federal funding during the fiscal year if funding is kept at existing levels. And all 50 states will be in even deeper trouble if the program is not renewed in some form or fashion. There's still time to act, however, and representatives on both sides of the aisle need to find a solution that does not force states to undo the gains that have been made in covering the nation's children.


Brad Cain is editor of California Healthfax and executive editor for managed care with HealthLeaders Media. He may be reached at bcain@healthleadersmedia.com.

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