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Details of the House-Senate Agreement on SCHIP

September 21, 2007

As is being widely reported in the press, President Bush has pledged to veto this House-Senate agreement on SCHIP legislation.  The Bush Administration has raised concerns about the proposed 61 cent increase in the current federal excise tax on tobacco, as well as provisions in the bill that would allow states to cover children in families above 200% of the federal poverty level.  The bill would increase SCHIP funding by $35 billion over 5 years, or enough to extend coverage to an additional 4 million eligible children (on top of the 6.6 million currently in the program). 

The agreement also provides $100 million in grants for new outreach activities to states, local governments, schools, community-based organizations, safety-net providers and others. The agreement also contains changes that would overturn new restrictions by the Bush Administration issued on August 17th that limit the ability of states to use SCHIP to cover higher income children. The President is requesting only a $5 billion increase for the program.

Most importantly for NAMI, the House-Senate agreement includes a provision requiring that mental illness coverage be "on par" with all other medical-surgical coverage. This provision is similar to a proposal that was included in the Senate Bill sponsored by Senators John Kerry (D-MA) and Gordon Smith (R-OR) that would require all private sector SCHIP plans to meet a standard of parity for mental illness treatment, i.e. requiring such health plans to have equal treatment limits (limits on inpatient days and outpatient visits) and financial limitations (cost sharing, deductibles, out-of-pocket limits) for mental illness and medical-surgical coverage. The final agreement is also expected to include  elimination of a provision in current law that allows some private sector SCHIP plans to have mental health benefits that cover only 75% of the actuarial value of all other health benefits.

Click here to read NAMI's letter in support of this House-Senate compromise.

Moratorium on Medicaid Rehabilitation Rule Included

The final House-Senate agreement includes a critically important Medicaid provision that was part of the version of the legislation (HR 3162) passed by House on August 1.  The provision would place 6-month moratorium on proposed regulations limiting the scope of rehabilitative services under Medicaid.  These regulations were issued by the Centers for Medicare and Medicaid Services (CMS) on August 10.  NAMI is currently developing comments on these draft regulations. NAMI is especially grateful to Rep. John Dingell (D-MI) for including the proposed moratorium in the House bill. NAMI also thanks Senators Ken Salazar (D-CO), Bernie Sanders (I-VT), and Deborah Stabenow (D-MI) for their letter to Senate leaders in support of the moratorium. Click here to view their letter.  Click here to view additional background on the draft CMS rules.

Exclusion of Medicare Provisions in the House Bill

The final House-Senate agreement excludes a broad range of improvements to Medicare, including a change lowering the current 50% cost sharing requirement for outpatient mental health services to 20%, bringing it to parity with all other outpatient medical services.  Improvements to the Medicare Part D drug benefit are also excluded from the final package.  Among these are codifying the current sub-regulatory requirement for broad coverage of medications to treat mental illness on plan formularies, restoration of coverage of benzodiazepines and expansion of eligibility for the Low Income Subsidy (and expansion of low-income beneficiaries exempt from the “doughnut hole” coverage gap).  

NAMI is extremely disappointed by the exclusion of critical beneficiary protections from the House-Senate SCHIP agreement.  However, House and Senate leaders have pledged to revive all of these proposals later this year, once the current struggle over the expected Presidential veto has run its course.  Advocates should expect to hear more from NAMI on efforts to bring all of these important Medicare provisions back later this fall.