Moving Forward? Reauthorization of SCHIP

1. Moving Forward?Reauthorization of SCHIP 2007 Kids Count Conference Cindy Mann Executive Director Center for Children and Families Georgetown University Health Policy Institute

2. Achievements

3. Trends in the Uninsured Rate of Low-Income Children, 1997- 2005 Source: CCF analysis of National Health Interview Survey.

4. Coverage Gains Over the Past Decade Have Come Equally from Medicaid & SCHIP Enrollment of Children in Public Coverage (Millions) 34.0 32.3 30.8 27.2 25.2 23.5 22.3 21.0 Source: CCF, Preliminary data. Based on children ever-enrolled over the course of a year.

5. Challenges

6. Second Consecutive Year of Rising Number of Uninsured Children Uninsured rate of 11.2% Uninsured rate of 12.1% Source: Kaiser Commission for Medicaid and the Uninsured

7. Premiums for Employer-Sponsored Coverage Are Growing Faster than Workers Earnings Note: The annual growth for premiums is statistically significant from the prior year at p<0.05 for every year except 2003. Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 2007, (September 2007).

8. SCHIP Spending is Rapidly Outpacing New Funds Being Made Available (in billions) Source: 1998-2007 data from Chris Peterson. SCHIP Original Allotments: Funding Formula Issues and Options. Congressional Research Service (October 2006); 2008-2012 data from Center on Budget and Policy Priorities’ SCHIP financing model (Nov. 2006).

9. Where Do We Go From Here?

10. SCHIP Reauthorization:Senate and House Bills(5 year spending) House Senate • Offsets • Reduction in overpayments to Medicare Advantage plans • 45-cent increase in tobacco tax • Other sources • Offsets • 61-cent increase in tobacco tax Source: Based on CBO numbers for H.R. 976 ( July 26, 2007) and H.R. 3162 ( August 1, 2007)

11. House & Senate SCHIP Reauthorization Bills Source: Kaiser Commission on Medicaid and the Uninsured, “SCHIP Reauthorization: Key Questions in the Debate,” (Revised August 29, 2007) and CCF.

12. White House Veto Threat • President proposed $4.8b in new federal funds (as opposed to $35b or $47b). • Objects to offsets. • Objects to favoring “government-run health care over private health insurance.” • Seeks limitation on children and adult coverage.

13. How Many Uninsured Children Would Be Covered? Sources: Congressional Budget Office estimates of H.R. 3162 (August 1, 2007) and H.R. 976 (August 24, 2007); and letter from CBO to Chairman Baucus, “Effect of the Administration’s Proposal for a Tax Deduction for Health Insurance on the Number of Uninsured Children,” (July 30, 2007).

14. Hot Issues

15. Focus on Low-Income Uninsured Children Limits “Crowd Out” SCHIP Enrollment (in Millions) “Public insurance expansions are by far the most cost-effective means of expanding insurance coverage in the U.S. today.” - Dr. Jon Gruber 7.5 6.1 Note: Average monthly enrollment for fiscal year 2012. Source: Congressional Budget Office estimates of H.R. 3162 (August 1, 2007) and H.R. 976 (August 24, 2007).

16. Capping Eligibility Levels • New CMS directive eliminates longstanding authority by establishing a federal income cap through the back door. • Could affect as many as 23 states and jeopardize the coverage of hundreds of thousands of children. Source: C. Mann & M. Odeh, “Moving Backward: New Federally Imposed Limits on States’ Ability to Cover Children,” Center for Children and Families (August 30, 2007).

17. Distribution of the Increase in Uninsured Children, by Income, 2005-2006 150,000 400%+ FPL 340,000 200-399% FPL 220,000 <200% FPL Source: Urban Institute for the Kaiser Commission on Medicaid and the Uninsured

18. Coverage of Parents • 11 states cover parents in SCHIP through waivers • In 2006, about 500,000 parents were enrolled in SCHIP Source: From the Kaiser Commission on Medicaid and the Uninsured: “Health Insurance Coverage in America: 2005 Data Update,” (May 2007); D. Cohen Ross, L. Cox, & C. Marks, “Resuming the Path to Health Coverage for Children and Parents,” (January 2007); and S. Artiga & C. Mann, “Family Coverage Under SCHIP Waivers,” (May 2007).

19. Uninsured Children by Citizenship Status, 2005 Total uninsured children: 9 million Children includes all individuals under age 19. Source: KCMU/Urban Institute analysis of March 2006 CPS.

20. Next Steps • Nullify directive? • Conference agreement? • Veto? • Short term extension? • Consequences of inaction

21. 35 States Will Face Shortfalls if SCHIP Is Not Reauthorized IL NH VT ME WA MT ND MN MA OR NY ID SD WI MI RI CT WY PA NJ IA OH NE IN NV DE IL WV VA UT MD CO CA MO KS KY NC DC TN SC OK AR NM AZ GA AL MS TX LA AK FL HI Federal SCHIP funding shortfall beginning October 1, 2007 (12 states) Federal SCHIP funding shortfall some time before October 1, 2008 (23 states) Note: These data are based on states’ May 2007 projections of FY2008 SCHIP spending. Missouri, Nebraska, and North Carolina are expected to face a shortfall by the end of October 2007. Source: C. Peterson, “What Happens if SCHIP Is Not Reauthorized?,” Congressional Research Service (August 28, 2007).

22. SCHIP Debate Reflects Larger Debate and Divisions • “We need universal health care coverage in this country, not stale ideas and savings account schemes.” - AFL-CIO President John Sweeney (February 1, 2006) • “I emphasize private insurance, the best health care plan -- the best health care policy is one that emphasizes private health. In other words, the opposite of that would be government control of health care.” - President George W. Bush (June 27, 2007)

23. IL States are Moving Forward NH VT ME WA MT ND MN MA OR NY ID SD WI MI RI CT WY PA NJ IA OH NE IN NV DE IL WV VA UT MD CO CA MO KS KY NC DC TN SC OK AR NM AZ GA AL MS TX LA AK FL HI Implemented or Recently Adopted Legislation to Improve Children’s Coverage (26 states and DC) Considering Significant Proposal to Improve Children’s Coverage (2 states) Source: As of August 2, 2007 based on CCF review of state initiatives.

24. Americans Support Covering Children 91% July 23, 2007 Source: Poll conducted by Lake Research Partners and American Viewpoint, national survey of 1,002 American voters from June 26 - July 1, 2007 for the Center for Children and Families