President Vetoes SCHIP, CMS Rule Now Faces Uncertainty

Wednesday, October 3, the President vetoed H.R. 976, a bill to reauthorize the State Children’s Health Insurance Program (SCHIP). The President pointed to the increased spending and tax hikes that Congress passed in order to pay for what he claims would lead to socialized health care. The bill expands the SCHIP program by $35 billion over five years by raising taxes on tobacco products to an even $1. The President originally proposed a $5 billion expansion, but lawmakers say that, due to inflation, such a small expansion will not even cover the same number of children that are already covered under the program.

The biggest impact the veto has on the education community concerns an amendment to the bill that addresses the Center for Medicare and Medicaid Services’ (CMS) cut in funding for reimbursements for administrative and transportation costs for students with disabilities. The amendment places a moratorium on the authority of the Secretary of Health and Human Services to take any action that would limit Medicaid payments to school districts. According to Section 616 of the conference report:

The Secretary of Health and Human Services shall not, prior to May 28, 2008, take any action […] to restrict coverage or payment under title XIX of the Social Security Act for rehabilitation services, or school-based administration, transportation, or medical services if such restrictions are more restrictive in any aspect than those applied to such coverage or payment as of July 1, 2007.

While the moratorium would only extend until May 28, 2008, it would represent a considerable victory for school districts and states that are resisting the recent regulatory actions by the Center for Medicare and Medicaid Services (CMS) to cut Medicaid funding by reducing school-based and rehabilitative services for children with disabilities. The threatened veto, however, places that victory in jeopardy. There is little likelihood that the Democratic majority can secure enough votes in the House and Senate at this point.

The Senate has the 67 votes necessary to override the veto, but the House has to act first, and presently it is shy of the 250 votes needed. House Majority Leader Steny Hoyer (D-MD) scheduled the override vote for October 18, giving Democrats two weeks to try and sway more Republicans to vote their way. Meanwhile, Republican leaders claim they will still sustain the veto and that Congress should move on to trying to pass a new SCHIP bill that the President will sign. In the meantime, assuming the override fails, the CMS amendment will need to find a new vehicle for passage.

Resources:
Stephen Langel, “Republicans Confident Bush Veto of SCHIP Will Be Upheld,” Congress Now, October 3, 2007.
Author: SAS