[Congressional Record (Bound Edition), Volume 148 (2002), Part 15]
[Extensions of Remarks]
[Page 21177]
[From the U.S. Government Publishing Office, www.gpo.gov]




    THE STATE CHILDREN'S HEALTH INSURANCE PROGRAM (SCHIP) ALLOTMENT 
                       EXTENSION AVAILABILITY ACT

                                 ______
                                 

                            HON. KEN BENTSEN

                                of texas

                    in the house of representatives

                      Wednesday, October 16, 2002

  Mr. BENTSEN. Mr. Speaker, I rise today to introduce legislation, the 
State Children's Health Insurance Program (SCHIP) Allotment Extension 
Availability Act of 2002, that would preserve funding for this 
critically important health insurance program. On October 1, 2002, 25 
states nationwide forfeited $1.2 billion in SCHIP funds because the 
Balanced Budget Act of 1997 included a provision that recaptured funds 
from those states which do not fully spend their SCHIP allotment in a 
timely manner. In addition, if we do not act to correct this inequity, 
states will lose an additional $1.6 billion next year.
  We simply cannot afford to reduce funding for SCHIP at a time when so 
many children remain uninsured. In essence, we will be hurting those 
programs which have helped so many children to get the health care 
services they need. A recent Census Bureau report found that the number 
of uninsured children is 8.5 million, a level equal to the previous 
year survey. In Texas, it is estimated that 11.7 percent of children or 
approximately 600,000 children lack health insurance.
  I believe that the SCHIP program has proven to be a valuable program 
for our nation's children. It was designed to cover those children 
whose family income is too high for Medicaid but not sufficient to pay 
for health insurance. As of 2000, an estimated 3.3 million children 
have been enrolled in SCHIP which is more than the 25 percent we 
estimated would benefit from this program when it was created. In 
Texas, it is estimated that at least 508,000 children are enrolled in 
the SCHIP program with more than 90,000 children enrolled in SCHIP in 
Harris County in my local area. If we penalize states for not moving 
fast enough to cover children, it is very likely that they will make 
changes to reduce the scope of coverage and discourage families from 
enrolling their children in this program.
  In the past, I and others have spearheaded efforts to expand and 
improve the SCHIP program and ensure that Texas was not shortchanged in 
the distribution of SCHIP funding because of the late start in 
establishing the program. In 2000, Congress, with my support, approved 
the Benefits Improvement and Protection Act (BIPA) of 2002 which 
included a provision to guarantee Texas extra funds for SCHIP. This law 
provided Texas an additional two years to spend $267 million of their 
1998 and 1999 allotments. Without this change, Texas would have lost 
$446 million in federal funds.
  I am now offering this legislation to correct the inequity that my 
state and others face for their Fiscal Year 2000 SCHIP allotment. 
According to Jason Cooke, Director of the Children's Health Insurance 
Program in Texas, as of October 1, 2002, Texas will lose $285 million 
due to this provision included in the Balanced Budget Act of 1997. 
Under my bill, the allotments for FY 1998 and 1998 would continue to be 
split between those states who have used their allotments and those who 
have not. The current ratio is 60 percent of unspent funds is returned 
to those states which have not used their allotments while 40 percent 
of unspent funds are forwarded to those states who have fully spent 
their allotments. However, my legislation would guarantee that states 
could keep all of their SCHIP allotments for FY 2000, 2001, and 2002.
  Some will argue that the states should have spent their SCHIP 
allotment within the three year time period provided for in the 
Balanced Budget Act of 1997. In fact, Texas and several other States 
did take longer to establish their program. At the time, I along with 
many of my colleagues urged the Texas Legislature and Governor to act 
quickly to help uninsured children and penalizing the states will have 
the unintended consequences of penalizing the children. However, I 
believe that we should remember the underlying goal of the SCHIP 
program is to expand coverage for uninsured children. In Texas, where 
many of these uninsured children live, this penalty will be harshly 
felt by these working families who simply cannot provide health 
insurance for their children. In my judgment, the goal of the expanding 
coverage outweighs the need to encourage quick development of such 
programs.
  I would also argue that we cannot afford to lose these funds in a 
time of shrinking state budgets. I am very concerned that the result of 
this reallocation will be to reduce health care services for children. 
With fewer dollars to spend on the SCHIP program, I believe states will 
makes changes to their programs which will reduce the number of SCHIP 
enrollees and discourage working families from joining this important 
program. For instance, states may decide to make enrollment more 
difficult for working families or states may act to restrict enrollment 
to lower income families. In Texas, where 11.7 percent of the children 
lack insurance, I believe we cannot afford to put up barriers to 
coverage.
  I also want to highlight that this legislation is similar to 
legislation included in President Bush's Fiscal Year 2003 budget that 
would ensure that states can keep their SCHIP allotments. The 
President's proposal would provide up to three additional years for 
states to spend their SCHIP funds through Fiscal Year 2006. The Office 
of Management and Budget has estimated that up to 900,000 children may 
lose their coverage due to this funding shortfall and would deprive 
states of $3 billion over two years.
  I urge my colleagues to support this effort to preserve and 
strengthen the SCHIP program.

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