House Passes 2 Year CHIP Extension Included in ‘SGR’ Compromise Deal

Editor’s Note UPDATE: Yesterday, the House passed this SGR-CHIP package, H.R.2, by a tremendous bipartisan vote (392-37-4).  Despite attempts by Senate leadership to get a vote to the floor before their recess, it looks like they will be taking the package up when they return April 13th. Stay tuned…

We’ve all been watching developments on the Hill (and our calendars!) to see what lawmakers would do about the need to extend funding for CHIP beyond this September. As Say Ahhh! readers are well aware, this year’s CHIP conversations began with Democrats calling for a clean, four-year extension with improvements and Republicans releasing a discussion draft of items that would rollback the successful children’s coverage we know today. (See our detailed summary of these proposals here.)

The current CHIP debate is happening as part of a larger package of health care improvements riding with the Medicare “doc fix” legislation that addresses deficiencies in the Sustainable Growth Rate (SGR) Medicare provider reimbursement formula. As reported recently in several news outlets, Speaker Boehner and Minority Leader Pelosi have agreed to a possible deal to make a permanent fix to SGR along with a clean extension of CHIP. Because the current SGR fix expires at the end of March, this is a fast-moving vehicle with real potential to get CHIP extended before the summer. Time is also of the essence for Congress to extend CHIP funding as state legislatures finalize their FY2016 budgets and need to know whether or not they’ll get the federal funding they need to keep coverage stable for children.

So what’s in the SGR deal related to CHIP?

According to details released today, the package would extend CHIP funding for two years under current law, including:

  • Maintaining CHIP’s current financing structure, including fully funded allotments through FFY 2017 (this also includes qualifying states provision and contingency fund);
  • Authorization of express lane eligibility (ELE) through FFY 2017;
  • ACA “stairstep” provision that moved some school-aged, separate CHIP children into Medicaid;
  • 23 percentage-point increase to the federal CHIP match, which begins October 1, 2015 (FFY 2016);
  • Maintenance of effort (MOE) for children’s coverage in Medicaid and CHIP, which requires states to maintain their eligibility levels and enrollment processes for children through 2019;
  • CHIPRA outreach and enrollment grants ($40M); and
  • CHIPRA quality provisions ($10M for childhood obesity demonstrations and $20M for pediatric quality measures).

What else in this deal would impact low-income kids and families?

A separate “extenders” part of the deal also includes a number of items that also would expire soon without action, including an additional two years of funding for home visiting programs, family-to-family information centers, and community health centers. It would also permanently authorize Transitional Medical Assistance (TMA, SSA 1925), which provides Medicaid to beneficiaries transitioning to employment.

Why only two years?

The length of any extension is far from the only CHIP policy issue in these talks, despite all the attention it is given. Rather, the extent to which an extension of any length maintains current policy or makes changes that could make kids worse off is also key. In this regard, what we don’t see in this package is also noteworthy. There are NO offsets or pay-fors that make cuts to Medicaid or the ACA. Pretty remarkable considering that House and Senate budget plans proposed such cuts just last week. And unlike last month’s CHIP discussion draft from House and Senate Republican health leaders, this package does not include any changes to CHIP that would roll back coverage for kids. A four-year, clean extension is something child advocates continue to prefer– a longer period would provide additional peace of mind for families and stability for state budgets. Indeed, House and Senate Democrats have made their preference for four years clear.

So what’s next?

Likely an up or down House vote on the full SGR/CHIP/extenders package before the House leaves for recess Friday. If the House passes the package then all eyes will be on the Senate. Stay tuned…

Elisabeth Wright Burak is a Senior Fellow at the Georgetown University McCourt School of Public Policy’s Center for Children and Families.