SCHIP Bait and Switch

Dennis Smith / October 22, 2009

Now that the Baucus Plan has been introduced as actual legislative language, it is clear more time is necessary to have a full understanding of the massive 1,500 page bill. As members get the opportunity to read the bill, more problems are likely to emerge on a daily basis.

For example, the Baucus Plan either puts states into fiscal jeopardy or provides another budget gimmick to avoid paying the full cost of the legislation through the treatment of the State Children’s Health Insurance Program (SCHIP). The SCHIP provisions have significant budgetary implications for either the federal government or the states. Section 1611 of the Baucus Plan provides a new 23 percentage point increase in the federal funding for SCHIP. That would seem like good news for states. However, under current law, there are no additional appropriations for SCHIP after 2012 and the Baucus Plan does not provide any increased funding. There is a budget cliff in 2013 that will cut federal funds for SCHIP in half.
In scoring the Baucus Plan, the Congressional Budget Office (CBO) must assume its current law baseline remains level. (more…)