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Trump and Congress are about to take an ax to children's healthcare

We’ve said it before and we’ll say it again: In the ridiculous mess that is the American healthcare system, there’s one indisputable success — children’s health coverage. Over the last two decades, the uninsured rate for children under 18 has fallen from 14% to less than 5%.

Today that achievement is under threat as never before. “We’re at real risk of moving backward,” says Joan Alker, executive director of the Center for Children and Families at Georgetown University. That’s because children’s healthcare in the U.S. is heavily dependent on three public programs, Medicaid, the Affordable Care Act, and the Children’s Health Insurance Program, or CHIP.

“All three legs of that stool,” Alker says, “are uncertain or threatened.”

Republican lawmakers seldom target children’s health programs with the fervid hostility they aim at Obamacare or Medicaid, but there are pockets of opposition. As a Georgia state legislator, Secretary of Health and Human Services Tom Price voted twice, in 2007 and 2008, against expanding CHIP in his state to cover millions more kids.

President Trump and the Republican Congress are planning to cut more than $800 billion out of Medicaid funding over 10 years while converting the program to a capped block grant to the states and eliminating the ACA’s Medicaid expansion. Those provisions are in the American Health Care Act, the House GOP’s Obamacare repeal bill.

These changes inevitably would lead to a reduction in funding; the Congressional Budget Office estimates that Medicaid spending would fall by 25% by 2026, compared with what would be available under current law. And although Senate Republicans have expressed doubts about the House bill as a whole, several have endorsed the idea of steep cuts in Medicaid.

Then there’s CHIP, which currently provides low-cost or free coverage to nearly 9 million children. CHIP was created in 1997 as a program run by individual states but subsidized by the federal government, generally at a rate of 65%. CHIP was enacted as a permanent program; its funding, however, was made subject to regular reauthorization by Congress.

That has led to periodic brinkmanship over whether Congress would act in time to avoid disruption. A few months shy of the last deadline, Sept. 30, 2015, Congress reauthorized CHIP through Sept. 30, 2017. That deadline now looms.

That’s a problem, because states need months of advance notice to keep CHIP functioning. “There’s intense concern about the deadline,” says Bruce Lesley, president of First Focus, a nonprofit advocacy group for children and families. “We’ve learned from the past that states have to plan ahead — if they’re not certain a program is going to continue they have to start thinking about winding it down.”

In some states, budgets for the coming fiscal year must be enacted as early as the end of March, in others the deadline comes between April and June. The ability of states to carry CHIP past Sept. 30 also varies — some state have enough money to cover children into fiscal 2018, but some will run out before the end of this year.

Even though CHIP is often regarded as a stand-alone program, its fate is inextricably entwined with both Medicaid and the Affordable Care Act. In many states, CHIP is integrated with Medicaid, so cuts to Medicaid will affect its funding, too. The ACA, furthermore, gave all states a bump in the federal share of CHIP funding of 23 percentage points through fiscal 2019. In 17 states including California, that brought the federal match to 88%, and in 11 states plus the District of Columbia, it rose to 100%. Although CHIP funding isn’t affected by the House Obamacare repeal bill, any wholesale repeal of the ACA would take the increase away.

CHIP is designed to fill in the coverage gap for children between Medicaid eligibility and the ACA or employer insurance. As the Center on Budget and Policy Priorities explains, prior to the ACA, state Medicaid programs had to cover children under age 6 with family incomes below 133% of the poverty line. The ACA extended coverage to all children up to age 18 in those households.

States can set their own CHIP eligibility ceilings, but most states provide coverage for children in homes with income of 200% of the federal poverty line or less. For a family of four, that cap would be income of $48,600. The average premium and cost sharing charged nationwide came to $158 per year per child in 2015. That’s well below what those families would pay for employer plans or Obamacare silver plans.

The good news is that CHIP always has received bipartisan support. Though it was enacted as a voluntary program, within three years of its passage CHIP had been accepted by every state. Just last week, the National Governors Assn. urged Congress to reauthorize CHIP to give states “certainty” about the program’s future, in a letter co-signed by its chair, Virginia’s Democratic Gov. Terry McAuliffe, and vice-chair, Massachusetts’ Republican Gov. Charlie Baker.

The bad news is that even if the program isn’t the target of the hostility that Republicans customarily aim at Medicaid, it’s threatened by congressional dysfunction in general and GOP dithering over healthcare generally. Every time the Trump White House throws Capitol Hill a curve ball — the James Comey firing merely the latest in a long sequence — doubts rise that Congress will get its act together in time to reauthorize CHIP. “We’re definitely freaking out that the base work Congress has to do is not getting done,” Lesley says.

That’s why the Medicaid and CHIP Payment and Access Commission (MACPAC), a nonpartisan congressional advisory body, recommended in January that CHIP be extended by five years to 2022. The idea was to inoculate the program, at least temporarily, from “heightened… uncertainty about the stability of the exchange market” and proposals to “change the structure and financing of the Medicaid program.”

MACPAC also recommended extending the 23-point funding bump to 2022 and eliminating a six-month waiting period imposed on children who lose employer-sponsored insurance.

Even if CHIP wins timely reauthorization, it’s the attack on Medicaid that really threatens children’s health, Alker points out. While CHIP covers nearly 9 million kids, Medicaid covers 37 million.

Republican rhetoric about Medicaid expansion covering “able-bodied” low-income adults at the expense of the children covered by traditional Medicaid is a smokescreen. “That’s pitting children against their parents,” she says. “We know that covering parents is good for children. Healthy parents are better parents. And when one person is uninsured, the whole family is exposed to financial insecurity.”

Republicans’ stated devotion to children’s welfare is aimed at distracting the public from the truth that their healthcare proposals would have a devastating effect on children. If their plans — especially their attack on Medicaid — go through, the result will be a massive public health crisis. It shouldn’t be allowed to unfold in secret.

Keep up to date with Michael Hiltzik. Follow @hiltzikm on Twitter, see his Facebook page, or email michael.hiltzik@latimes.com.

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