Letter to Senator Max Baucus, Chairman, Senate Finance Committee and Senator Charles Grassley, Ranking Member, Senate Finance Committee

Letter

Letter to Senator Max Baucus, Chairman, Senate Finance Committee and
Senator Charles Grassley, Ranking Member, Senate Finance Committee

Senator Max Baucus, Chairman
Senate Finance Committee
Washington, DC 20510

Senator Charles Grassley, Ranking Member
Senate Finance Committee
Washington, DC 20510

Chairman Baucus and Ranking Member Grassley:

We represent states that led the way in increasing children's health care coverage prior to the creation of the State Children's Health Insurance Program (SCHIP). As part of the upcoming SCHIP reauthorization, we urge you to correct an inequity in the SCHIP law that penalizes this leadership.

When SCHIP was created, our states were already covering low-income kids up to at least 185 percent of poverty - in some cases higher - through our Medicaid programs. The original SCHIP statute prohibited our states from using federal SCHIP dollars for these targeted low-income kids. A handful of states that had expanded coverage using state dollars were allowed to grandfather their programs into SCHIP. Our states were completely locked out.

Most states waited to expand kids' coverage until after SCHIP was created in 1997 and were rewarded with an enhanced federal SCHIP matching rate. Our states, which were the early movers on kids' coverage, were denied the enhanced match for kids at exactly the same income levels.

The impact of the penalty grows as our states cover more low-income kids. Rather than all states having the same incentive to enroll low-income children, for every new child we enroll that falls under our expansion programs, we miss out on the enhanced federal SCHIP payment.

A temporary measure, the so-called "qualifying states" provision, has allowed our states access to up to 20 percent of our SCHIP allotment for our expansion populations. While helpful, the 20 percent provision falls far short of equity for our states. We should not continue to be penalized for our leadership in covering kids. We need access to our full SCHIP allotment to support our coverage of low-income kids.

We urge you to ensure that any SCHIP reauthorization package allows qualifying states full access to our SCHIP allotment to support coverage for kids in our expansion populations. Further, any new baseline for determining SCHIP state allotments should count our expansion populations to help prevent our states from being further penalized for being leaders in kids' coverage.

Thank you for your consideration of our views. We look forward to working with you to ensure full equity for our states in SCHIP reauthorization.

Sincerely,

Senator Maria Cantwell
Senator Pete Domenici
Senator Patty Murray
Senator Daniel Akaka
Senator Jeff Bingaman
Senator Chris Dodd
Senator Sheldon Whitehouse
Senator Ben Cardin
Senator Daniel Inouye
Senator Barbara Mikulski
Senator Bernie Sanders
Senator Amy Klobuchar
Senator Patrick Leahy
Senator Jack Reed
Senator Norm Coleman
Senator Herb Kohl
Senator Russ Feingold
Senator Joe Lieberman