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Washington Updates

August 8, 2000

		Government Affairs Newsletters Washington Updates Hey, Wait A Minute State Legislative Updates Through the Grapevine

Gore Chooses Senator Lieberman as Vice Presidential Running Mate

Vice President Gore has announced that Sen. Joseph Lieberman, (D-CT) will be his vice presidential running mate. Lieberman becomes the first Jewish American to be named to a major party national ticket. He is a former state senator and Connecticut attorney general who was first elected to the Senate in 1988. The first Senate Democrat to publicly condemn President Clinton's affair with Monica Lewinsky, Lieberman said in a September 1998 floor speech he was "personally angry" over Clinton's "disgraceful behavior." Lieberman today said he would be proud to stand beside Gore, a former Senate colleague. Under Connecticut law, Lieberman could run for vice president and seek re-election to the Senate at the same time. A state Democratic spokesman today indicated that the expectation is that Lieberman will compete in both races. If Lieberman were to win both, his Senate resignation would allow GOP Gov. John Rowland to appoint a Republican until a 2002 special election. In this year's Senate race, Lieberman is the heavy favorite to defeat Republican Waterbury Mayor Philip Giordano. A National Republican Senatorial Committee spokesman said Lieberman would have to "straddle two horses" and declined to look forward to a 2002 special election, saying, "We don't expect Gore to win."

New Research on Those Who Are Voluntarily Insured

A California HealthCare Foundation article published in a recent issue of Health Affairs looked at why the non-poor, those with family incomes of at least 200% of the federal poverty level, lack health insurance in California. The study separated this uninsured population into three subgroups: a higher income group not worried about health insurance that are unlikely to enter the market voluntarily; a "cost-constrained" group that is "quite concerned" about health coverage and close to the income floor of 200% of poverty; and a group that the study found was willing to purchase health insurance after they were better educated about the cost of health care. The report indicates that the group that elects not to purchase insurance because they are "unworried" about health care, are somewhat of an enigma, because there has not been a lot of research or discussion about this group. There appears to be a tremendous amount of variation of how these people are treated when they are suddenly rendered bankrupt by high health care costs. The second group, or those that are cost-constrained, are individuals who are near the 200% poverty line who are candidates for coverage if new products designed for them enter the market, or if they have financial purchasing assistance. The article noted that several states have tried to help this group by subsidizing coverage for parents of children enrolled in CHIP or Medicaid. There is a significant amount of controversy over these proposals about what the cutoff point should be and the fact that single individuals at the same income levels are not eligible for coverage. There is also considerable controversy over whether expanding these programs is the right way to reach the uninsured, and whether a tax credit or other subsidy allowing for a choice of coverage in the private individual or employer market would be a better alternative. The California HealthCare Foundation study found that a significant percent of the non-poor uninsured might be persuaded to buy health insurance once they are educated about the options and actual costs. This finding raises the question -- who is responsible for education and outreach? Because the government is mainly concerned with efforts to ensure that lower income groups obtain health insurance, the responsibility often falls on the shoulders of other organizations. The study has been well-received by industry representatives and, as a result, new efforts on the part of the industry to recapture this population and to get them more interested in insurance options are being explored. It will be important in the months and years ahead as new subsidies become available for the purchase of private health insurance that NAHU members assist in public education and outreach in order to reduce the number of the uninsured and avoid…

Expansion of Government Programs

The trend toward expansion of government programs is on the rise. The Urban Institute recently reported that extending Medicaid eligibility requirements to uninsured, low-income parents would reduce the uninsured population by 5.2 million. In 1997, 37% of low-income adults were uninsured, compared to 21% of low-income children. Parents represent more than one-third of the uninsured population and many could receive coverage under Medicaid if states broadened adult eligibility requirements, the report asserts. States now are required to allow children under age five in families with incomes up to 133% of the federal poverty level and children ages 6-15 in families with incomes below 100% into the Medicaid program. The 1996 welfare reform package, known as the Personal Responsibility and Work Opportunity Reconciliation Act, expanded Medicaid eligibility to include adults and children who previously would have been entitled to Aid to Families with Dependent Children. This new category of Medicaid eligibility gives states the ability to use "less restrictive income and resource standards" to determine an adult's eligibility for Medicaid. Of the 7.3 million low-income parents who were uninsured in 1997, 3.5 million would qualify for coverage under existing Medicaid law since their incomes fall below the federal poverty level if states expanded Medicaid eligibility using the authority given to them under welfare reform. Expanding Medicaid to include children and their parents with incomes up to 200% of poverty would make another 2.1 million uninsured parents eligible for Medicaid. At the same time, the report notes that President Clinton has proposed allowing states to cover parents of children in Medicaid or CHIP by providing federal matching funds currently available under CHIP. The report notes that under such an expansion, "more states might be inclined to expand coverage to parents" and possibly even include coverage to higher-income parents (Dubay et al., "Extending Medicaid to Parents: An Incremental Strategy for Reducing the Number of Uninsured," June 2000). The full report is available at http://newfederalism.urban.org/html/series_b/b20/b20.html.

An Act of Defiance

HCFA has ordered Arkansas Medicaid officials to stop enrolling children in the ARKids First program if they are eligible for the full-service Medicaid program, but Governor Mike Huckabee has vowed to continue. The Huckabee administration has enrolled some Medicaid –eligible children in the less generous ARKids First program, insisting that some parents are unwilling to sign up for the main program. The Governor said in his letter that the HCFA decision would result in some children not being covered because of the "stubborn pride of Arkansas’ working people." He cited the case of a western Arkansas family where the father refused to sign up for the Medicaid program because he "wanted to pay something, however small. He said he didn’t want ‘charity’."

Medicare+Choice Pullouts

The Health Care Financing Administration has released the official list of plan non-renewals for 2001 showing more than 900,000 enrollees will be affected by carriers exiting the market. "The fact that almost 1 million Medicare beneficiaries, this year alone, will be affected by health plans being forced out of the Medicare+Choice program reinforces the magnitude of this crisis and the need for action now." Karen Ignagni, president and CEO of the American Association of Health plans said in a news statement. HCFA’s state by state listing of plan withdrawals for 2001 is available at http://www.hcfa.gov/medicare/nrwebdat.htm. Meanwhile, Senate Budget Chairman Pete Domenici (R-NM) and Ron Wyden (D-OR) introduced Medicare+Choice payment reform legislation July 26, S2937. The bill would establish a new minimum payment floor for 2001 and would correct the hospital wage index to benefit low-cost regions. The bill would give plans $3.7 billion in federal funding over five years, significantly less than the $15 billion the American Association of Health Plans has said is needed to sustain the program. In a related event, the Alliance to Improve Medicare held a news briefing to discuss Medicare reform and other issues related to the Medicare+Choice program. The Alliance is a coalition of 35 organizations (including NAHU) who represent seniors, doctors, hospitals, businesses, medical researchers, and others who are dedicated to achieving comprehensive reform of traditional Medicare. NAHU is a member of AIM’s policy committee.

Antitrust a.k.a. Physician Unions

The House passed Physician Union bill was referred to the Senate HELP committee shortly before the Senate recessed. According to our information, a large number of HELP committee members already oppose HR1304. We will continue our lobbying efforts in the Senate and are hopeful that the Senate will not perpetuate the error the House made in passing this bill.

For Further Information

Please Contact: Janet Stokes Trautwein,
Director of Federal Policy Analysis
(703) 276-3806
jtrautwein@nahu.org