House Energy and Commerce Committee Releases Text of Medicaid/CHIP Reconciliation Provisions

Last night, legislative language was released by the House Energy and Commerce Committee (which has jurisdiction over Medicaid and the Children’s Health Insurance Program (CHIP)) – the “Build Back Better Act”. The Committee plans to “mark up” these provisions starting Monday — so things are now moving quickly inside the Beltway to move forward a major domestic reconciliation package. Here’s a quick summary of the issues we’re watching.

Most importantly, among its Medicaid, CHIP and Affordable Care Act provisions, the bill provides a comprehensive and permanent federal fix to the “coverage gap” – which readers of SayAhhh! know well – exists for people below the poverty line in the twelve remaining states that have refused to expand Medicaid. Other important policy improvements are included as well to respond to the nation’s crisis in maternal mortality and improve and sustain children’s coverage. All in all, the package makes vitally important changes to improve the nation’s public coverage system — after a period during which uninsured rates began to rise and a pandemic swept the nation.

Filling the coverage gap

The bill contemplates a two-phase approach that starts with offering zero dollar premium tax credits to those below poverty to obtain coverage in the federal marketplace in 2022 and ending in 2024. There would be no premiums and cost-sharing would be modest. Benefits would also be enhanced in 2024 to look more like Medicaid – though not entirely so. By 2025, the Secretary of HHS is directed to establish a federal Medicaid “look-alike” program that would become the permanent approach to cover those in the gap. States that had an expansion in place as of January 1, 2022 would have to continue to contribute 10% of the cost of those that received coverage through the new federal program – this is designed to discourage states from dropping their Medicaid expansions.

For more details on the fallback, see this paper from our colleagues at the Center on Budget and Policy Priorities.

Requiring states to cover children for 12 months in both Medicaid and CHIP

This is a critical change that will improve kids’ continuity of coverage, reduce the uninsured rate, and enhance the ability of policymakers to measure quality. Currently, 24 states have taken this “continuous eligibility” option for kids in Medicaid and 26 states have taken the option in separate state CHIP programs; if enacted all states would be required to cover children for a twelve-month period in both programs. Our recent paper on the value of continuous coverage explains why this is such an important policy.

 Improving maternal health

 The bill requires all states to extend full-benefit Medicaid and CHIP postpartum coverage to one year after the end of pregnancy by redefining the postpartum period in statute from 60 days after the end of pregnancy to 12 months after the end of pregnancy. The change builds on the American Rescue Plan’s state plan option to extend postpartum coverage to one year after the end of pregnancy, which many states have already moved to take up, and instead makes the extension mandatory. The state would receive its regular Medicaid and CHIP matching rate for the extended postpartum coverage period.

The bill also makes significant investments in growing and diversifying the perinatal workforce, education and anti-bias training for healthcare providers, and support for data infrastructure to better support and track maternal health outcomes for women of color. Many of these investment opportunities were driven by the Black Maternal Health Momnibus, a package of several bills designed to comprehensively address all dimensions of the nation’s maternal health crisis.

What other changes does the bill make to CHIP?

In addition to the post-partum coverage extension and kids continuous eligibility changes noted above (which apply to both Medicaid and CHIP), the legislation has a number of welcome CHIP provisions including (most importantly) making its federal funding permanent. As our recent paper outlining CHIP policy recommendations pointed out, unlike Medicaid, CHIP’s funding has to be reauthorized periodically. Sometimes Congress doesn’t do its job on time – most notably in 2017 when the program’s extension lagged for many months  – causing states to tell families they were about to close enrollment in some cases. The current eligibility maintenance-of-effort requirements are also made permanent along with continued funding for outreach and enrollment grants.

The bill also makes a welcome technical change that would allow states to raise their upper income eligibility through a simple state plan amendment. Changes made by the Affordable Care Act to the calculation of income rendered this avenue difficult for states to move forward to expand eligibility for kids, including likely requiring a Section 1115 waiver. Funding for pediatric quality measures is also extended.

We will continue to unpack the provisions of the bill so stay tuned!

Joan Alker is the Executive Director of the Center for Children and Families and a Research Professor at the Georgetown McCourt School of Public Policy.