President Obama’s new deficit reduction plan attempts to address concerns that blending the federal reimbursement rates for Medicaid and the Children’s Health Insurance Program (CHIP) would shift too much costs to the states by delaying its implementation until 2017 and producing a modest amount of savings relative to earlier versions of the plan. But some in Congress are still concerned that the greater cost shift to states would undermine the programs. Sen. Jay Rockefller (D-WV) — a strong proponent of both the Medicaid and CHIP — denounced the Obama’s modified blended rate proposal yesterday, saying it would devastate CHIP:
The proposal doesn’t specifically call for ending CHIP. But Rockefeller said that’s what would happen because CHIP would be a program where states could cut. Rockefeller was asked about the blended rate proposal when he stopped to talk to reporters after the Senate Democrats’ policy lunch Tuesday. “I hate it,” he said. Asked whether he still thinks it would kill CHIP, a prediction he made when the blended rate idea was floated earlier this year, Rockefeller said “it will do a very good job of that. Yeah, that would be my guess. Governors love CHIP until they have to start paying more for it.”
While the administration claims a blended rate would streamline and simplify the reimbursement formulas, states would receive less under a blended rate proposal because the federal government would average the reimbursement rates for all populations into a single rate. Rockefeller and other Medicaid advocates worry that this could signal the beginning of the end for CHIP. The Affordable Care Act requires states to maintain their current CHIP enrollment through 2019, but as CQ’s John Reichard reports, it “only funds them through 2015,” thus setting “the stage for a debate that year about how well the exchanges are doing in providing coverage and whether CHIP is really needed.”
Rockefeller characterized Obama’s cuts to Medicare and Medicaid as “hard” on seniors and the poor and said he would rather raise taxes on the wealthiest Americans. “You have to raise taxes. It isn’t a question of being a Democrat or of being a liberal. Or not being liberal. It’s just math,” he told Reichard.