The Centers for Medicare and Medicaid Services (CMS) announced a new rule that would reduce funding for inpatient rehabilitation facilities in fiscal year 2009. According to CQ Health Beat (via Kaiser Network), the $20 million reduction, required by Congress, would prevent a cut to Medicare physicians payments. The same legislation reauthorizes the State Children’s Health Insurance Program (SCHIP).
In other SCHIP news, the Government Accountability Office (GAO) contends that the Bush administration violated federal law when it prevented states from expanding SCHIP, because it did not follow the rule-making process. (Kaiser Network)
Comments from Senators John Rockefeller and Olympia Snowe, who requested the GAO opinion:
“The directive is a bold-faced attempt to subvert the law and prevent states from implementing their plans to provide health insurance coverage to millions of uninsured children nationwide,” Rockefeller said in a statement (CQ Today, 4/18). Snowe said, “CMS chose to circumvent the rules and go their own way,” adding that “this is clearly the wrong approach” (CongressDaily, 4/18). Rockefeller and Snowe in a release wrote, “CMS now has a critical choice to make: rescind the rule or continue to spend taxpayer money defending a growing list of lawsuits it is unlikely to win” (AP/Lexington Herald-Leader, 4/19).
You may download the report summary or full opinion.
As you may recall, the Bush administration has proposed to cut spending on programs like Medicaid, including reducing physician reimbursements. A coalition of local governments and providers in California plans to file a lawsuit to stop these cuts. (Kaiser Network)
San Francisco Mayor Gavin Newsom said that a proposed 10 percent reimbursement reduction could serve as a disincentive to doctors treating patients in Medi-Cal, California’s Medicaid program. He fears patients will seek treatment in hospital emergency rooms, which are already overburdened. The lawsuit, if filed, would claim that Medicaid cuts would unfairly transfer responsibility for coverage to local governments that fund public hospitals.
Governor Arnold Schwarzenegger’s administration said the reduced reimbursement rate is not a long-term solution but one that would ensure beneficiaries remain covered.
Although President George W. Bush twice vetoed bills that would have expanded the State Children’s Health Insurance Program (SCHIP), Democrats in the House of Representatives are still trying to find ways to expand the program. (Kaiser Network)
Last week, Charles Rangel, chair of the House Ways and Means Committee, said the House budget reconciliation bill would include provisions to expand SCHIP and stop a 10 percent Medicare physician payment reduction. The measure would increase SCHIP funding by $50 billion and delay the physician payment cut for two years.
The National Governors Association has gone on record to oppose the Bush administration’s proposal to shift more Medicaid costs to the states. (Kaiser Network)
The shift reportedly will save $15 billion over five years. One change under the new rules is that states no longer will be allowed to use Medicaid funds to help pay for physician training. The administration contends there’s “no explicit authorization under the Medicaid statute to subsidize the training of physicians.” This change reportedly will save $1.8 billion over five years.
Additionally, hospitals and nursing homes will see new limits on Medicaid payments. At least two Republican governors are publicly critical of the plan.
Related post:
The Bush administration plans more Medicaid rule changes. Earlier this week, CQ Weekly reported that the administration plans to shift more Medicaid costs to the states, prompted by Government Accountability Office studies that show states have used “questionable” practices to gain more federal dollars. (Kaiser Network)
From the report (emphases added):
The first regulation, to be issued March 3, would end payments for ancillary services provided under case-management plans. The administration considers these services, which can include assistance finding housing or paying utility bills, outside the scope of Medicaid. The second regulation, to be issued May 25, would limit how much states could pay health care providers; end Medicaid reimbursements for medical intern and resident salaries; end reimbursements to schools for busing Medicaid-eligible students; and limit the range of services that could be considered “rehabilitation” for Medicaid patients.
The administration seems to be taking an aggressive approach to curbing Medicaid waste. If a Democrat wins the White House in November, however, these Medicaid funding cuts could be rescinded or scaled back.
Related posts:
Last week, House Democrats failed to override President George W. Bush’s veto of the State Children’s Health Insurance Program (SCHIP) expansion bill. This week, they’re considering drafting a new bill that would expand SCHIP, place a moratorium on rules limiting Medicaid eligibility, and provide a temporary boost to the federal medical assistance percentage for Medicaid. (Kaiser Network)
Will Democrats garner enough votes for the proposed bill to override a presidential veto? Probably not. The issue seems to surround the amount of funding for SCHIP and not expansion itself.
After President Bush vetoed the SCHIP expansion bill the first time, lawmakers revised it but didn’t change the funding amount. Mike Leavitt, secretary of the Department of Health and Human Services, said the administration would have been willing to sign a bill to increase SCHIP’s funding by only $20 billion over five years, as opposed to $35 billion over five years. Unless Democrats come up with a lower figure, it’s likely Republicans will vote against the measure.
In other funding news, Senate Democrats have criticized President Bush’s fiscal year 2009 budget proposal, in which he seeks to reduce Medicare and Medicaid funding. Read more about the hearings at the Kaiser Network.
Last Wednesday, Democrats in the House of Representatives failed to override President George W. Bush’s veto of the State Children’s Health Insurance Program (SCHIP) expansion bill. Democrats were 15 votes short of the required 2/3 majority needed to override a presidential veto. (Kaiser Network)
Last year, Bush twice vetoed a bill that would have expanded SCHIP by $35 million over five years. Mike Leavitt, secretary of the Department of Health and Human Services, said the administration would have been willing to sign a bill to increase SCHIP’s funding by only $20 billion over five years. The administration and some Republicans were concerned that the expansion would lead to coverage of children whose families could afford private insurance at the expense of children whose families could not.
In this contentious election cycle, the Democrats likely will use Republican’s “NO” votes as political leverage.
Republican congressman Joe Barton of Texas (pictured) told the Washington Post and CQ Today: “There is no child currently on SCHIP that is going to lose coverage, regardless of the vote…Continue the existing program, perhaps expand coverage somewhat for families above 200% of poverty and cover every child in the country under 200% of poverty.”
Read more SCHIP-related posts.
One ongoing issue in Congress will be whether the Centers for Medicare and Medicaid Services (CMS) has the authority to prevent states from expanding Medicaid coverage.
President George W. Bush twice vetoed measures that would have expanded the State Children’s Health Insurance Program (SCHIP). According to the Kaiser Network, the administration has restricted states like Ohio, Louisiana, and Oklahoma from expanding SCHIP unless they demonstrate that they’ve enrolled at least 95 percent of children in the state below 200 percent of the poverty level. In other words, CMS wants to make sure children in low-income households are adequately covered before offering coverage to children in higher-income households.
Democrats in both houses of Congress say that CMS does not have the authority to prevent states from expanding Medicaid coverage to more children. Download the four-page press release and legislative letter (PDF) that lays out the arguments.
A New York Times story elaborates on the idea that the Bush administration is trying to preserve Medicaid for families targeted by the program – low-income families – by preventing states from expanding it. An expansion may extend coverage to families who can afford to buy private health insurance.
President Bush twice vetoed a measure that would have expanded and funded the State Children’s Health Insurance Program (SCHIP) to the tune of $35 billion over five years. The administration, which placed restrictions on SCHIP’s expansion last August, is apparently applying the restrictions to Medicaid across the board, as negotiators in Louisiana, Ohio, and Oklahoma recently found out. An excerpt:
On Dec. 20, the Bush administration rejected a proposal by Ohio to expand its Medicaid program to cover 35,000 more children. Ohio now offers Medicaid to children with family incomes up to twice the poverty level, or about $41,000 a year for a family of four. The state had proposed increasing the limit to three times the poverty level, to about $62,000.
“Federal officials told us that they would apply the criteria set forth in the Aug. 17 letter to our proposal for expansion of Medicaid,” said Cristal A. Thomas, the Ohio Medicaid director.
Dennis G. Smith, the director of the federal Center for Medicaid and State Operations, confirmed that account.
Tony Fratto, a spokesman for the administration, told the Times: “We want states to focus on enrolling their neediest population before they consider expanding Medicaid and CHIP to middle-income families. This policy demonstrates the president’s compassion. He wants to direct scarce tax dollars to those with the greatest needs.”
Earlier this week, the U.S. Senate approved a bill that would delay a 10 percent physicians fee cut for six months. The Senate also voted to extend the State Children’s Health Insurance Program (SCHIP) through March 2009. (Kaiser Network)
The bill would increase physicians fees by 0.5 percent for six months. Commenting on this action, the American Medical Association (AMA) said:
“It is extremely disappointing that after all the hard work in the House earlier this year to replace two years of Medicare physician payment cuts with increases that would help physicians keep up with medical practice costs, the final action passed by the House and Senate stops the cut for just six months, which creates uncertainty for both Medicare patients and physicians.”
Among other things, the Senate-passed measure would bar the service area expansion of Medicare Advantage special needs plans and put a limited moratorium on new long term acute care hospitals to ensure that patients are receiving appropriate levels of care at existing facilities.
Regarding SCHIP, you may recall that President George W. Bush twice vetoed a bill that sought to fund and extend the program. The AMA said it “applauds Congress for taking action to renew the government health care coverage program for America’s low-income children. This action will provide federal funds to cover state budget shortfalls.”