CHIP called "down payment" in reform effort

Washington -- The Children's Health Insurance Program reauthorization that President Obama signed Feb. 4 is just the first step toward universal health coverage, asserted Obama and Senate Democratic leaders.

"The way I see it, providing coverage to 11 million children through CHIP is a down payment on my commitment to cover every single American," the president said during the signing ceremony. The enactment of the measure was hailed by patient and physician organizations, including the American Medical Association.

Sens. Max Baucus (D, Mont.), chair of the Senate Finance Committee, and Edward Kennedy (D, Mass.), chair of the Senate Health, Education, Labor and Pensions Committee, sent a letter to Obama the next day stating their commitment to adopting universal coverage legislation this year. "We have a moral duty to ensure that every American can get quality health care. ... Incremental efforts will no longer suffice, and we cannot afford to wait any longer."

The CHIP reauthorization expands the program by $32.8 billion over 4½ years and is expected to cover about 4 million more children than the 7 million enrolled in the existing program. The new law will take effect April 1. As part of the federal government's new enhanced role in children's coverage, the law removes "state" from the program's name.

Obama on Feb. 5 also rescinded restrictions on CHIP eligibility that were issued by the Centers for Medicare & Medicaid Services on Aug. 17, 2007, and went into effect a year later. The so-called "Aug. 17 directive" barred a state from using federal matching CHIP funds to cover children in families at or above 250% of the federal poverty level unless the state had covered 95% of kids in families at or below 200% of poverty. CMS never officially enforced the policy, which was the target of lawsuits from several states seeking to protect their CHIP eligibility.

Sen. Jay Rockefeller (D, W.Va.), chair of a Senate Finance subcommittee on health care, said he's been fighting the directive ever since CMS unveiled it. "Our pleas finally have been heard by a president who shares our passion for children's health care," Rockefeller said.

The CHIP reauthorization allows states to receive enhanced federal matching funds to cover children in families earning up to 300% of poverty.

Senate in the lead

The Senate is at the forefront of current health system reform efforts, said Joseph Antos, PhD, a health care scholar at the American Enterprise Institute.

Kennedy and Baucus both have been holding committee hearings on health reform, but House Democrats have been less active on the issue. Baucus already has offered a 110-page outline of comprehensive legislation. This move, combined with the Feb. 3 withdrawal of former Sen. Tom Daschle from consideration for Health and Human Services secretary, has placed Baucus in the spotlight, Antos said. "Baucus clearly must feel that he's the go-to guy in the Senate."

The Daschle exit likely has delayed the Obama administration's health reform plans, said Nina Owcharenko, former legislative director for then-Rep. Jim DeMint (R, S.C.) and a health policy analyst at the Heritage Foundation. "A lot of the wheels probably are not up and running as quickly as they would like," she said.

Antos described the departure of Daschle as HHS secretary-designate as a bump in the road, but he added, "Is it a big bump? Who knows?"

Daschle's withdrawal probably hasn't changed the Democrats' health agenda, said Chris Jennings, a former senior health policy adviser to President Clinton. The Obama plan seeks to extend health coverage to the uninsured while allowing those with existing coverage to keep it. The president remains committed to health reform, Jennings said. But for a plan to be adopted, it will have to be seen as an American plan, not just one person's bill, he said.

Republicans seem to be taking a more reactive role in health reform, Antos said. "It's a party that seems not to be as focused as they might be at the beginning of a new presidential term," he said. Still, the Republican leaders of both chambers -- Rep. John Boehner (R, Ohio) and Sen. Mitch McConnell (R, Ky.) -- both have announced health reform policy working groups.

"House Republicans will not be content to be 'the party of no.' Instead, we will be the party of better solutions, and few issues demand more positive solutions than our nation's health care crisis," Boehner said Feb. 4. Rep. Roy Blunt (R, Mo.) is leading a panel of 15 House members who will craft Republican proposals. Four of the members are physicians.

McConnell's group, announced Jan. 12, consists of Sens. Mike Enzi (R, Wyo.), Charles Grassley (R, Iowa) and Orrin Hatch (R, Utah). Their task is to ensure that any health legislation in the Senate has GOP input, according to a McConnell spokesperson. Grassley and Hatch worked closely with Democrats to craft 2007 CHIP legislation that President Bush vetoed twice.

Hard work remains

The CHIP reauthorization is a significant advance in health coverage, said Ted Epperly, MD, president of the American Academy of Family Physicians. "I definitely see this as a sign that this administration is deeply committed to reforming and transforming health care in this country."

But the enactment doesn't make national health reform any easier to achieve, Owcharenko said. The Democrats benefited from having kids as the face of the legislation. "When we talk about overhauling the entire health care system, there are a lot of different faces, and a lot of them may be winners and a lot of them may be losers."

Dr. Epperly agreed that achieving wider health reform will remain a challenge, including replacing Medicare's physician fee formula with a sustainable pay system.

But because Medicare and other public programs are facing huge deficits, lawmakers in Congress are going to feel pressure to do something on the health system soon, Jennings said. "I've always been a believer that in health care, fear beats hope. This is a case where fear may drive all of the stakeholders to move very, very actively to promote health reform."