Obama Reverses Bush Administration Policy Directive That Restricted States’ Abilities To Expand CHIP to Children in Higher-Income Families

In a memorandum issued on Thursday, President Obama lifted two Bush administration policy directives that limited states' flexibility in expanding CHIP coverage to children in higher-income families, the AP/Philadelphia Inquirer reports (Freking, AP/Philadelphia Inquirer, 2/6). The Bush administration in an Aug., 17, 2007, letter said that states seeking to expand CHIP to children in families with incomes greater than 250% of the federal poverty level first must verify that 95% of eligible children in families below 200% of the poverty level are enrolled in the program (Johnson/Pulizzi, Dow Jones, 2/5). HHS also required states to verify that children in families with incomes above 250% of the poverty level have been uninsured for one year before qualifying for CHIP (Young, The Hill, 2/5).

According to the Obama memo, states must confirm that the number of eligible children enrolled in private insurance does not decrease by more than 2% as a result of expanded government insurance (Dow Jones, 2/5). The administration in August 2008, when the policy change was scheduled to take effect, opted not to take action and allowed the eight states that would have been affected by the directives to operate their CHIP programs normally. However, the letters never were officially rescinded (Armstrong, CQ Today, 2/5).

Obama in the memo wrote, "These requirements have limited coverage under several state plans that otherwise would have covered additional uninsured children" (CongressDaily, 2/5). He added, "As a result, tens of thousands of children have been denied health care coverage" (The Hill, 2/5). According to the memo, the Obama directive does not create any new benefit but it lets reauthorization and expansion of the program -- signed into law Wednesday -- proceed without interference (CQ Today, 2/5). A spokesperson for Sen. Jay Rockefeller (D-W.Va.) said the reversal will eliminate potential confusion for states expanding their CHIP plans. The spokesperson said, "I think it sends a very important signal to everybody that this (Bush policy) is gone" (The Hill, 2/5).

Opinion Pieces

• Sen. Jeanne Shaheen (D-N.H.), Manchester Union Leader: The CHIP expansion bill "could not come at a more critical time" because "many more parents and children face extremely difficult financial challenges," Shaheen writes in a Union Leader opinion piece. She continues, "Getting coverage for more of our children is a good start, but Americans are counting on comprehensive health care reform." Shaheen writes, "I look forward to working with my colleagues on both sides of the aisle to confront this challenge, and I'm confident that if we work together, we can get it done" (Shaheen, Manchester Union Leader, 2/6).
  
  
• Sen. John Cornyn (R-Texas), San Antonio Express-News: "The Senate debate wasn't about whether to reauthorize" CHIP because every member of the Senate "supports providing health care for low-income children"; it was about how to "efficiently and effectively provide care for children," Cornyn writes in an Express-News opinion piece. He adds, "Unfortunately, the Democratic legislation leaves low-income children behind," as it "would provide billions of taxpayer dollars to children other than those who need it most." According to Cornyn, "If enacted, millions of Americans could drop private health plans and overload CHIP in favor of federally funded care," adding, "This is not what was intended when [CHIP] was originally crafted." He adds, "In today's economy, it's important that we provide coverage to low-income children without placing an undue burden on taxpayers," but the "Democrats' bill fails to take into account this type of fiscal responsibility and instead raises taxes for lower-income families -- using budgetary gimmicks to mask the true cost of the bill -- while providing earmarks for New York and New Jersey." He writes, "Congress had a choice: Focus on covering low-income children or expand the program well beyond its original intention, leaving many low-income children behind," concluding, "Unfortunately for ... children, a majority of my colleagues chose the latter" (Cornyn, San Antonio Express-News, 2/5).