SCHIPS without Ponch and Jon

On Friday, the California HealthCare Foundation held a convening on SCHIP (State Child Health Insurance Program) reauthorization–the technical term for the Congressional debate this year on how much money should be allocated to the federal program that funds 2/3 of California’s Healthy Families program. HHS Secretary Kim Belshe and MRMIB Director Lesley Cummings were there, as were policy wonks and advocates.

As Belshe said, this is the biggest health care policy issue on the federal agenda this year. She not only extolled the program’s worthy goal of covering children, but also its “operational success”–an important part of the case for additional funding is the fact that it works, and that it has actually served to decrease the number of uninsured children. We’ll report on this issue more throughout the year, but a few quick points from the meeting:

* Cummings stated that the next few years will be the first real test of the “block grant” nature of the program; up until now, it has been sufficiently funded, but some states have started to run out of funds, and depending on the funding debate this year, California may follow, with creating waiting lists or even dropping children off of coverage.

* The President’s proposal is woefully inadequate: $25 billion over the next 5 years would mean hundreds of thousands of California children being dropped from coverage. In the choice between having stable funding or increased funding to keep up with growing demand, President Bush took the third and worst option, which is to under-fund children’s coverage.

* The SCHIP reauthorization can’t be less than $60 billion over the next 5 years, in order to have the funds to meet the goal of covering all California children. The policy people are still refining the numbers, in order to account for variables such as different formulas to distribute funds between the states, or the impact of declining employer-based coverage, or different take-up rates. But that’s the general figure.

My comments at the forum focused on how this fits into the broader policy debate.

* First, those of us who will advocate for $60 billion or more to fund children’s coverage will also need to take another step, to support the revenues or offsets needed. Under the new “paygo” rules, where both tax cuts and new spending need to be balanced with other budget items, the proposal by Rep. Rahm Emmanuel and others to do more in collecting capitol gains taxes is welcome, as a way to show that children’s coverage is important enough that we have to pay for it. There’s lots of ways to raise the money we need: we just need to provide support for those who properly prioritize children’s coverage, and who take the harder but necessary step of finding the money.

* Secondly, this debate is fundamental to the broad conversation on health reform here in California. Whether you support the Governor’s plan, or the ones by the Speaker, the Senate President Pro Tem, or Senator Kuehl, they all would be better financed and more feasible and workable with full SCHIP funding. The less funds there are for kids, the harder it is to find the resources to cover their parents.

* Third, all these debates are intertwined. SCHIP is a key priority, but not the only one for the cause of children’s coverage. For example, there’s been a big drop in employer-based coverage for children, as employers start scaling back benefits with dependent coverage. The recent report on Safeway shows that for new employees, the waiting periods to get individual coverage is 18 months, and for family coverage it’s 30 months. That’s a trend, especially at big fast-food and chain restaurants and many retailers. Healthy Families was wildly successful at picking up the slack and preventing a dip in the rates of children’s coverage, but broader reforms will be needed to truly get universal children’s coverage.

We’ll be talking about SCHIP reauthorization throughout the year here on this blog.

Health Access California promotes quality, affordable health care for all Californians.
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