Compromise Kids’ Health Bill Unlikely To Include Medicare Revisions

Congressional negotiators have agreed not to include revisions to Medicare in compromise State Children's Health Insurance Program legislation that would reauthorize and expand the program, and lawmakers could vote on compromise legislation next week, CongressDaily reports (Johnson, CongressDaily, 9/19).

The draft compromise bill, announced on Sunday, closely resembles the Senate version of SCHIP legislation, which would provide an additional $35 billion in funding over the next five years and bring total spending on the program to $60 billion. The additional funding would be paid for by an increase in the tobacco tax, which would be similar to the 61-cent-per-pack tax proposed in the Senate version (California Healthline, 9/18).

The compromise bill does not include provisions of the House bill that would reduce payments to Medicare Advantage plans to help fund an expansion of the program, leaving a cigarette tax increase as the primary funding source for the legislation. However, a greater cigarette tax increase than was included in the House SCHIP legislation is "riling many members of Congress from tobacco-producing states," according to the Washington Times.

Sen. Jim Bunning (R-Ky.) said that under the proposed tax increase, Kentucky would pay $602 million more in tobacco taxes over five years than it would receive in SCHIP funds. California would receive $2.5 billion more in SCHIP funding than what it would spend on the tobacco tax, according to Bunning (Lengell, Washington Times, 9/19).

In addition, some House Democrats "have bristled" at being asked to separate the Medicare revisions, according to the Wall Street Journal.

Senate Finance Committee Chair Max Baucus (D-Mont.) said he will pursue several Medicare issues at a later date, including cuts to MA plans and reversing a scheduled cut in physician reimbursement rates. Baucus said he is considering cuts to MA plans that are "not as much" as those in the House SCHIP bill, but he noted that some cuts "will be significant."

A "major motivation" for lawmakers to reconsider revisions to Medicare is the scheduled physician reimbursement rate cut. Reducing payments to MA plans could help provide funds to delay the physician reimbursement cuts, according to the Journal (Lueck, Wall Street Journal, 9/19).

A "number of fine points" within the compromise bill still "need to be determined," according to a House Democratic aide (Wayne, CQ Today, 9/18).

House Speaker Nancy Pelosi (D-Calif.) and House Energy and Commerce Committee Chair John Dingell (D-Mich.) will ask Senate negotiators to accept small changes in the bill on issues such as mental health, dental care, documented immigrant coverage and pregnant women, according to House Ways and Means Committee Chair Charles Rangel (D-N.Y.) (Johnson, CongressDaily, 9/18).

House negotiators also are seeking mental health parity under SCHIP (CongressDaily, 9/19).

Sen. Orrin Hatch (R-Utah) said he is willing to hear Pelosi and Dingell's requests but is not willing to sacrifice any votes that would cause them to lose a veto-proof margin in the Senate (CongressDaily, 9/18).

Rep. Deborah Pryce (R-Ohio) said that in the House, "[m]ost of the moderates will vote for SCHIP if the Medicare piece is taken out" (Weisman/Murray, Washington Post, 9/19).

Pelosi said that the House is expected to vote on SCHIP legislation on Tuesday, CongressDaily reports. If the House passes the measure unchanged, it will go directly to President Bush to sign or veto. However, if the House makes changes to the bill, the Senate will need to hold another vote -- which could give "GOP leaders a chance to protest and cause delay," according to CongressDaily.

Senate Republican leaders have not decided whether they will block an SCHIP bill if given the opportunity, according to a Senate leadership aide (CongressDaily, 9/18).

Baucus on Tuesday said it is likely that the Senate will need to re-vote on the legislation. If lawmakers are successful in passing legislation by Sept. 30, when the program is set to expire, Democrats will be able to blame the White House for allowing the program to expire, House Majority Leader Steny Hoyer (D-Md.) said (CongressDaily, 9/19).

Meanwhile, the administration has asked Congress to send the president a short-term extension of the program.

An HHS official said, "The proposals being discussed currently are unsound, and it looks increasingly unlikely that this will get resolved by Sept. 30. Congress needs to pass a clean extension now so low-income children will not lose their coverage and we will have sufficient time to continue to work on this issue."

Democrats have said they will pass an extension of the program after the president issues a veto (CongressDaily, 9/18).