Congress Leans Toward Approval of Senate SCHIP Funding Levels

Congress is likely to pass a bill to reauthorize the State Children's Health Insurance Program, or SCHIP, that is based more on the Senate's version of the program than a more expensive House measure. But Congress may adopt a key provision in the House reauthorization bill that provides a positive update in physician Medicare payments as part of a final SCHIP bill, according to analysts interviewed by AAFP News Now. As for whether the president would sign such a bill -- there are those in Congress who think Bush might be persuaded to accept a compromise bill, despite earlier veto threats.

In early August, the House and Senate passed SCHIP reauthorization bills that would greatly expand the program during the next five years. The Senate bill, S.B. 1893, (at the Library of Congress' THOMAS Web site, type "S 1893" in the search bar after selecting "Bill Number") totals $35 billion; the House measure, H.R. 3162, (at the Library of Congress' THOMAS Web site, type "HR 3162" in the search bar after selecting "Bill Number") is for $50 billion. The Senate bill, which has greater bipartisan support than the House legislation, passed by 68 votes, giving the Senate version an edge as House and Senate conferees prepare to reconcile the two bills, according to analysts.

"The Senate bill already has a veto-proof margin," said Amy Pellegrino, legislative assistant for Sen. Olympia Snowe, R-Maine, one of the sponsors of the Senate bill. "If we want to get SCHIP reauthorized in a timely way, we are going to have to take a long, hard look at where the consensus is, and the Senate has demonstrated that the consensus is the $35 billion increase and the 68 votes."

Unlike the Senate bill, the House legislation addresses Medicare physician payment issues, providing a 0.5 percent increase in Medicare physician payments for the next two years and thus negating steep reductions that are scheduled to take place based on the sustainable growth rate, or SGR, formula in 2008 and 2009. Congress could approve the Senate's $35 billion SCHIP reauthorization bill while incorporating the House's provision to provide positive payment updates for physicians as part of a final SCHIP bill, according to several analysts.

"The two-year update could still be included in the SCHIP bill," said Kevin Burke, director of AAFP's Division of Government Relations.

Both the House and Senate bills "represent a real step forward in terms of covering more uninsured children in this country," said Genevieve Kenney, Ph.D., a principal research associate with the Health Policy Center at the Urban Institute.

"If the nation wants to reduce noninsurance among low-income children, both of these bills provide the tools and the financing to make significant progress," Kenney said. "That dovetails with what seems to be a growing interest at the state level to address this problem head-on and effectively."

President Bush, meanwhile, proposed a $5 billion increase for SCHIP reauthorization during the next five years in his 2008 fiscal year budget, an amount the Congressional Budget Office and the Center on Budget and Policy Priorities both found insufficient to maintain current enrollment. Bush has said he would veto both the House and Senate bills, saying that each represents an unacceptable expansion of SCHIP and a move toward socialized medicine.

HHS Secretary Michael Leavitt, in an Aug. 1 written statement said the House reauthorization bill "will move millions of children from private insurance to public assistance and create a new middle-class entitlement that our country cannot afford."

"This action has already delayed the reauthorization of this necessary program and put in jeopardy the health insurance of millions of needy children nationwide," Leavitt said in his statement. "We need a fiscally responsible bill that the president can sign so SCHIP can be reauthorized."

There is a general feeling in Congress that Bush may be willing to compromise on the Senate bill and perhaps even accept the Senate legislation. But former acting CMS Administrator Leslie Norwalk, J.D., in a recent speech in New York, expressed doubts that the administration and Congress would be able to reach an agreement on a five-year extension of SCHIP. She said a two-year extension might be more acceptable to the White House.