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GAO, CRS Blast Bush Over SCHIP Rules « The Washington Independent

Last August, on a Friday evening in the midst of a long congressional recess, the White House quietly sent a letter to state health officials announcing dramatic new enrollment guidelines surrounding the popular State Children’s Health Insurance Program (SCHIP).

In a nutshell, the “Aug. 17 directive” prohibited states from using federal SCHIP dollars to cover kids in families earning above 250 percent of the federal poverty level ($53,000 for a family of four) until they had covered at least 95 percent of all Medicaid- and SCHIP-eligible kids living under 200 percent of poverty ($42,400 for the same family).

The Bush administration said the change would force states to put their SCHIP dollars where Congress intended them to go — namely, to the lowest-income families eligible for the program. But state health officials, children’s healthcare advocates and many congressional lawmakers cried foul, claiming not only that the 95-percent requirement is impossible to meet, but also that the White House has no authority to make such sweeping changes without congressional notice and review.

Eight months later, two separate reports have been released backing up those criticisms. The (pdf) and the (pdf) have reported that the changes are significant enough to constitute a rule subject to the Congressional Review Act, not merely a “directive” (i.e., a clarification), as the White House claimed.

According to the GAO report:

The August 17 letter from CMS to state health officials is a statement of general applicability and future effect designed to implement, interpret, or prescribe law or policy with regard to [SCHIP]. Accordingly, it is a rule under the Congressional Review Act. Therefore, before it can take effect, it must be submitted to Congress and the Comptroller General.

The reports have caused a stir among a number of lawmakers, who began reacting publicly Friday with calls for the administration to scrap the guidelines voluntarily. One such statement comes from the office of Sen. Jay Rockefeller (D-W.V.), one of the initial champions of the SCHIP program.

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. 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.

No word yet from the White House on this, but you can bet the pressure is on to react. That’s because the Aug. 17 directive gave those states that currently cover kids above 250 percent of poverty one year to comply with the 95-percent rule or lose their right to do so. That’s four short months away. Better call your lawyer.

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