MARY ELLEN SCHNEIDER (New York Bureau)
Nearly 11 million low-income children will receive health coverage under the reauthorization and expansion of the State Children's Health Insurance Program, which was recently signed into law by President Barack Obama.
The legislation (H.R. 2), which received broad support in both the House and Senate, was signed this month. SCHIP is now reauthorized through September 2013 and will provide coverage to the approximately 6.7 million children currently covered by the program, as well as 4.1 million new children.
“But this bill is only a first step,” President Obama said at a signing ceremony for the SCHIP law. “The way I see it, providing coverage to 11 million children through [SCHIP] is a down payment on my commitment to cover every single American. And it is just one component of a much broader effort to finally bring our health care system into the 21st century.”
By signing the SCHIP legislation, President Obama is living up to his promise to expand health care coverage, said Dr. Ted Epperly, president of the American Academy of Family Physicians. The law, he said, addresses some of the most critical elements of the health care system—mental health parity, expanded coverage of dental services, access to primary care, and deterrents to cigarette smoking.
While the law does not address how to increase coverage for adults, Dr. Epperly said the early signals from the Obama administration have him feeling optimistic. For example, the economic stimulus package under consideration by Congress at press time includes increases in Medicaid coverage and funding for health information technology.
On the same day he signed the SCHIP law, President Obama directed the Centers for Medicare and Medicaid Services to rescind a Bush administration directive that limited the flexibility of states to set higher income eligibility standards for their SCHIP programs.
Under the newly enacted SCHIP law, states are allowed to cover children in families up to 300% of the federal poverty level while retaining access to full federal matching funds. It also gives states the option to cover prenatal care for pregnant women. However, it also requires states to phase out coverage of any low-income parents and childless adults currently covered under the program.
The new law eliminates the 5-year waiting period for legal immigrant children and pregnant women to gain access to SCHIP benefits.
States will have the option to provide dental-only coverage to children who have private insurance, which often has limited coverage for dental services. The law also requires states to ensure mental health parity in their coverage offerings. Previously, the law only required states to match 75% of their physical health coverage.
In an effort to measure and improve health care quality, the law calls for development of an initial core set of child health quality measures for children enrolled in SCHIP and Medicaid by Jan. 1, 2010. The measures would be designed to assess the effectiveness and availability of preventive services, prenatal care, and treatments for acute and chronic conditions.
Excluded from the law was a House-passed provision that would have prohibited the construction of new physician-owned specialty hospitals or expansion of existing physician-owned hospitals.

While SCHIP has enjoyed wide support in Congress, members of the House and Senate had a vigorous debate over the last month about whether such a significant expansion of the program was appropriate. Some Republicans in the House objected to the legislation, saying that it would undermine the original intent of the SCHIP legislation by expanding the program to adults, illegal immigrants, and families with higher incomes. While the legislation bars the coverage of illegal immigrants, Republicans who spoke out against the legislation said that the lack of an adequate system to verify citizenship status would result in illegal immigrants gaining access to coverage.

In the Senate, some Republican opponents of the expansion expressed concerns that the legislation covered children who were not in low-income families and that it would result in children leaving private insurance plans.

But the law signed by the president has been widely praised by children's health advocates as necessary during the current economic downturn.

“Sharp increases in unemployment have likely added more children to the ranks of the uninsured and put increasing pressure on state health care programs,” Dr. Nancy Nielsen, president of the American Medical Association, said in a statement. “This new law will enable states to extend health care coverage to more children whose parents cannot afford it, but earn too much to qualify for Medicaid.”

“With the stroke of President Obama's pen, states now have the funds to provide insurance coverage to more than 11 million children nationwide,” Dr. David T. Tayloe Jr., president of the American Academy of Pediatrics, said in a statement. AAP leaders called on the president and Congress not to stop with SCHIP but continue to work toward broader health reform for children.

The enactment of the SCHIP law was praised by the American Psychiatric Association for requiring states to ensure mental health parity under their programs. The mental health provision of the SCHIP law will strengthen access to mental health services, including substance abuse treatment services for children, according to the APA. “Children's mental health is essential to their well-being, and access to mental health care will enable children to play, learn, and grow into healthy adults,” Dr. Nada Stotland, APA president, said in a statement.

The SCHIP law, which will infuse more than $30 billion into the program over 5 years, will be paid for in large part through a 62-cent-per-pack increase in the federal tax on cigarettes, with proportional increases for other tobacco products.

The AMA praised the increase in the tobacco tax saying the move will help fund health care for more children and act as a deterrent to young smokers and potential smokers.

Attempts to reauthorize the program during the last session of Congress were unsuccessful when Congress twice failed to override vetoes of similar legislation from President George W. Bush.