[Senate Report 108-78]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 166
108th Congress                                                   Report
                                 SENATE
 1st Session                                                     108-78

======================================================================



 
  AVAILABILITY OF SCHIP ALLOTMENTS FOR FISCAL YEARS 1998 THROUGH 2001

                                _______
                                

                 June 24, 2003.--Ordered to be printed

                                _______
                                

  Mr. Grassley, from the Committee on Finance, submitted the following

                              R E P O R T

                         [To accompany S. 312]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Finance, to which was referred the bill 
(S. 312) to amend title XXI of the Social Security Act to 
extend the availability of allotments for fiscal years 1998 
through 2001 under the State Children's Health Insurance 
Program (SCHIP), reports favorably thereon and recommends that 
the bill do pass.

                             I. BACKGROUND

    The Balanced Budget Act of 1997 (BBA 97; P.L. 105-33) 
established the State Children's Health Insurance Program 
(SCHIP) under a new Title XXI of the Social Security Act. In 
general, this program gives States the option to provide health 
insurance coverage to uninsured children in families with 
income that is above Medicaid eligibility levels, but below 200 
percent of the Federal poverty level. States may provide 
coverage through Medicaid, create a new separate State program 
that meets minimum benefit requirements, or employ a 
combination of both approaches.
    All 50 States, the District of Columbia, and the 5 
territories operate SCHIP programs. As of December 2002, 21 
States provided coverage through Medicaid, 20 states offered 
coverage through separate State programs, and 15 States used a 
combination approach. Approximately 4.6 million children were 
enrolled in SCHIP during FY2001, the most recent year for which 
data is available. More than 3.4 million children were served 
in separate State programs, while 1.2 million were enrolled in 
Medicaid expansions.
    Like Medicaid, SCHIP is a Federal-State matching program. 
While the Medicaid Federal medical assistance percentage (FMAP) 
ranges from 50 percent to 76.62 percent in FY2003, the enhanced 
SCHIP matching rate ranges from 65 percent to 83.63 percent 
across States.
    The BBA appropriated a total of $39.7 billion for SCHIP for 
the period from fiscal year 1998 through fiscal year 2007. 
Annual allotments among the States are determined by a formula 
that is based on a combination of the number of low-income 
children and low-income uninsured children in the State, and 
includes a regional cost factor. Federal funds not drawn from a 
State's allotment by the end of each fiscal year continue to be 
available to that State for 2 additional fiscal years. SCHIP 
law requires that allotments not used at the end of 3 years be 
redistributed by the Secretary of Health and Human Services 
(HHS) to States that have fully spent their original allotments 
for that year. Redistributed funds which are not used by the 
end of the fiscal year in which they are reallocated return to 
the Treasury.
    On September 30, 2002, unspent SCHIP funds from fiscal 
years 1998 and 1999 expired and reverted to the U.S. Treasury. 
Unspent funds from fiscal year 2000 are to be recovered from 
States that did not use these funds by September 30, 2002 and 
redistributed to States that fully spent their fiscal year 2000 
allocations. Redistributed fiscal year 2000 funds that are not 
used by September 30, 2003 will expire and revert to the 
Treasury at that time.
    Unspent funds are largely the result of timing conflicts 
between the initial implementation of SCHIP and the period of 
availability of the annual allotments. Funds from the early 
years of the SCHIP program accumulated while States worked 
through the start-up process and established functioning 
programs. Now that State SCHIP programs are fully operational 
and have enrolled millions of children, they are threatened 
with the loss of funding necessary to keep those children 
enrolled. The redistribution and retention of unspent funds 
permitted under this bill will help States maintain enrollment 
of children in SCHIP.

                        II. DESCRIPTION OF BILL


Section 1. Extension of availability of SCHIP allotments for fiscal 
        years 1998 through 2001

            (a) Extending availability of SCHIP allotments for fiscal 
                    years 1998 through 2001

                              CURRENT LAW

    Funds for the State Children's Health Insurance Program 
(SCHIP) are authorized to be appropriated for FY1998 through 
FY2007. From each year's appropriation, each State is allotted 
an amount determined by a formula set in law. Federal funds not 
drawn from a State's allotment by the end of each fiscal year 
continue to be available to that State for 2 additional fiscal 
years. For example, FY2003 allotments are available until the 
end of FY2005. SCHIP law requires that allotments not used at 
the end of 3 years be redistributed by the Secretary of Health 
and Human Services (HHS) to States that have fully spent their 
original allotments for that year. Redistributed funds which 
are not used by the end of the fiscal year in which they are 
reallocated return to the Treasury.
    The Medicare, Medicaid, and SCHIP Benefits Improvement and 
Protection Act of 2000 (BIPA 2000), created a special rule for 
the redistribution and availability of unused FY1998 and FY1999 
SCHIP allotments. This special rule decreased the amount 
available for redistribution to States that had used all of 
their original allotments for these 2 years and allowed States 
that had not spent all of their allotments to retain some of 
their unspent funds.
    States that did fully expend their SCHIP allotments for 
each of those years by the 3-year deadline received an amount 
equal to spending in excess of their original exhausted 
allotment. Each territory that used its original allotment for 
each of those years by the 3-year deadline received an amount 
equal to 1.05 percent of the total amount available for 
redistribution to all States and territories multiplied by that 
territory's proportion of the allotments available for all 
territories.
    States that did not fully expend their SCHIP allotments by 
the 3-year deadline retained from remaining unspent funds an 
amount equal to their proportional contribution to the total 
pool of unspent funds. These States were able to use up to 10 
percent of the retained FY1998 funds for outreach activities.
    To calculate the amounts available for redistribution and 
retention in each formula described above, the Secretary used 
expenditures reported by States not later than December 15, 
2000 for the FY1998 reallocation, and November 30, 2001 for the 
FY1999 reallocation. Redistributed and retained funds from 
FY1998 and FY1999 were available through the end of FY2002. Not 
all States used their redistributed 1998 and 1999 funds.
    On March 27, 2003, CMS published an interim policy for a 
partial redistribution of unused FY2000 allotments (available 
for redistribution after September 30, 2002). CMS intends to 
issue a final redistribution methodology (as determined by the 
Secretary) in the Federal Register by June 30, 2003 unless 
Congress passes legislation for the redistribution of unspent 
FY2000 allotments.

                          COMMITTEE PROVISION

    The Committee's bill would extend the availability of 
FY1998 and FY1999 reallocated funds through the end of FY2004 
and would establish a new method for redistributing unspent 
allotments for FY2000 and for FY2001. This new method is a 
modified version of the special redistribution rules for 
unspent FY1998 and FY1999 allotments.
    For each of FY2000 and FY2001, no more than 50 percent of 
the total amount of unspent funds would be available for 
redistribution to States, commonwealths, and territories that 
exhausted their SCHIP allotments for each of those years by the 
applicable 3-year deadline. Subject to this ceiling, each such 
State would receive an amount equal to 50 percent of the total 
amount of unspent funds for each of those years minus amounts 
redistributed to the territories, multiplied by the ratio of 
such State's spending by the applicable 3-year deadline in 
excess of such State's original exhausted allotment for each of 
those years, to total spending by the applicable 3-year 
deadline for all States that exhausted their SCHIP allotments 
for each of those years in excess of all such State's original 
exhausted allotments for each of those years. Each territory 
would receive an amount equal to 1.05 percent of the total 
amount available for redistribution for each of those years 
multiplied by that territory's proportion of the original 
allotment available for all territories.
    The Committee's bill would make redistributed funds from 
the FY2000 reallocation available through the end of FY2004. 
Redistributed funds from the reallocations for FY2001 would be 
available through the end of fiscal year 2005.
    For each of FY2000 and FY2001, the amount available for 
retention among those States that did not fully expend their 
SCHIP allotments by the applicable 3-year deadline would be 
equal to 50 percent of such State's unspent funds for each of 
those years.
    The Committee's bill would make retained funds for such 
jurisdictions from the FY2000 reallocation available through 
the end of FY2004. Retained funds from the reallocation for 
FY2001 would be available through the end of FY2005.
    Similar to current law for FY1998 and FY1999, to calculate 
the amounts available for reallocation for FY2000 and FY2001, 
the Secretary would use expenditures reported by States not 
later than November 30 of the applicable calendar year.

                           REASON FOR CHANGE

    Under current law, a total of $2.7 billion in SCHIP funds 
either expired September 30, 2002 or are projected to expire on 
September 30, 2003. These unspent funds are largely the result 
of timing conflicts between the initial implementation of SCHIP 
and the period of availability of the annual allotments. Funds 
from the early years of the SCHIP program accumulated while 
States worked through the start-up process and established 
functioning programs. Now that State SCHIP programs are fully 
operational and have enrolled more than 5 million children, 
they are threatened with the loss of funding necessary to keep 
those children enrolled.
    This provision would prevent $2.7 billion in unspent SCHIP 
funds from reverting to the Treasury and will help States to 
avert the projected national enrollment decline resulting from 
the decrease in SCHIP allotments.

                             EFFECTIVE DATE

    This subsection, and the amendments made by this 
subsection, shall be effective as if this subsection had been 
enacted on September 30, 2002, and amendments under Title XXI 
of the Social Security Act for fiscal years 1998 through 2000 
are available for expenditure on and after October 1, 2002, 
under the amendments made by this subsection as if this 
subsection had been enacted on September 30, 2002.
            (b) Authority for qualifying States to use certain funds 
                    for Medicaid expenditures

                              CURRENT LAW

    No provision.

                          COMMITTEE PROVISION

    For FY1998, FY1999, FY2000 and FY2001, the Committee's bill 
would allow ``qualifying States'' to use up to 20 percent of 
their original SCHIP allotment or their reallocated funds (for 
that fiscal year) for certain Medicaid medical assistance 
payments. Qualifying States would be eligible to receive, 
subject to availability of their SCHIP allotment or reallocated 
funds for the year, an amount equal to the difference between 
the enhanced SCHIP matching rate and the FMAP for Medicaid 
expenditures (in a given fiscal year) associated with children 
through age 18 with family incomes greater than 150 percent of 
the Federal poverty level (FPL). Use of these funds for 
expenditures incurred under an approved Section 1115 waiver in 
the qualifying State would not impact the budget neutrality 
agreement for such States. For example, they may not be counted 
as an offset to ensure that the predicted ``with waiver'' costs 
do not exceed the ``without waiver'' costs as required by the 
budget neutrality agreement.
    For a given fiscal year, ``qualifying States'' would 
include those who: (1) as of April 15, 1997, or under a Section 
1115 waiver implemented on January 1, 1994, had a Medicaid 
income eligibility standard for at least one category of 
children (excluding infants) of at least 185 percent FPL; and 
(2) as of January 1, 2001 had a SCHIP eligibility standard of 
at least 200 percent FPL, or greater than 200 percent FPL if 
under a Section 1115 waiver targeted at uninsured children; (3) 
did not impose waiting lists or enrollment caps for children 
whose family income is at least 200 percent FPL; (4) provide 
statewide SCHIP coverage to all children who meet such State's 
income and other eligibility requirements; and (5) have 
implemented at least three of the following procedures for 
establishing children's eligibility for their Medicaid and 
SCHIP programs: (a) use the same uniform, simplified 
application form; (b) do not apply asset tests; (c) adopt 12-
month continuous enrollment; (d) use same forms, verification 
policies, and frequency for initial eligibility determinations 
and eligibility redeterminations; and/or (e) initial 
eligibility determinations can be made by disproportionate 
share hospital (DSH) facilities as well as federally qualified 
health centers.

                           REASON FOR CHANGE

    In order for States to access their SCHIP allotments, 
current law requires States to expand income eligibility levels 
above the levels in effect under Medicaid on March 31, 1997. 
SCHIP funds may not be used to pay for children already 
eligible for Medicaid as of this date.
    A small number of States have been unable to access a large 
portion of their SCHIP allotments because their Medicaid 
eligibility levels were significantly above the Federal 
mandatory minimum levels for Medicaid when SCHIP was enacted. 
This provision would allow those States to use a limited amount 
of their SCHIP allocation to cover the costs of certain 
children who were already enrolled in Medicaid when SCHIP was 
enacted, provided that the States meet a number of criteria 
related to eligibility simplification and enrollment.

                             EFFECTIVE DATE

    Effective upon enactment of this act.

          III. REGULATORY IMPACT STATEMENT AND RELATED MATTERS


                           Regulatory Impact

    In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee makes the following 
statement concerning the regulatory impact of the bill as 
amended.

                  IMPACT ON INDIVIDUALS AND BUSINESSES

    Section 1(a) extends the availability of SCHIP allotments 
for fiscal years 1998 through 2001 and Section 1(b) provides 
authority for qualifying States to use certain funds for 
Medicaid expenditures. Because these provisions merely enable 
States to spend funds previously allocated to them, they do not 
impose any additional paperwork or regulatory burdens on 
individuals or businesses.

                       IMPACT ON PERSONAL PRIVACY

    The Committee bill permits States to spend SCHIP funds 
previously allotted to them. Because the bill does not change 
any existing rules related to the health insurance coverage 
provided by States through Medicaid or SCHIP, it has no new 
impact on personal privacy.

                           IV. BUDGET EFFECTS

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, June 23, 2003.
Hon. Charles E. Grassley,
Chairman, Committee on Finance,
U.S. Senate,
Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 312, a bill to amend 
title XXI of the Social Security Act to extend the availability 
of allotments for fiscal years 1998 through 2001 under the 
State Children's Health Insurance Program.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Eric 
Rollins and Jeanne De Sa.
            Sincerely,
                                       Douglas Holtz-Eakin,
                                                          Director.
    Enclosure.

S. 312--A bill to amend title XXI of the Social Security Act to extend 
        the availability of allotments for fiscal years 1998 through 
        2001 under the State Children's Health Insurance Program

    Summary: S. 312 would make several changes to the 
availability of allotments for the State Children's Health 
Insurance Program (SCHIP). The bill would make allotments for 
fiscal years 1998 through 2001 available for a longer period of 
time and change the way that they are allocated among states. 
The bill also would allow certain states to spend a portion of 
these allotments on children enrolled in Medicaid.
    CBO estimates that S. 312 would increase direct spending by 
$85 million in 2003, $85 million in 2004, and $975 million over 
the 2003-2013 period. The bill would increase spending in the 
SCHIP program by almost $1.8 billion over the 2003-2013 period 
by giving states more time to spend their SCHIP funds. By 
making more SCHIP funds available, the bill also would reduce 
the extent to which states would see Medicaid funds to offset 
shortfalls in SCHIP funding. As a result, CBO estimates that 
enacting the bill would reduce Medicaid outlays by $790 million 
over the 2003-2013 period. On balance, enacting the bill would 
increase direct spending by just under $1 billion over the 
2003-2013 period.
    S. 312 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA). 
The bill would give states more time to spend unused SCHIP 
funds from their allotments for the fiscal years 1998 through 
2001. Certain states also would be able to use some of those 
funds on behalf of children in Medicaid with family incomes 
above 150 percent of the federal poverty level. CBO estimates 
that state spending for SCHIP would increase by about $690 
million over the 2003-3013 period, and state spending for 
Medicaid would decline by about $750 million over the same 
period.
    Estimated cost to the Federal Government: The estimated 
impact of S. 312 is shown in the following table. The costs of 
this legislation fall within budget function 550 (health). 
CBO's estimate assumes that S. 312 would be enacted before 
August 1, 2003.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                        By fiscal year, in millions of dollars--
                                                              ------------------------------------------------------------------------------------------
                                                                2003    2004     2005     2006     2007    2008    2009    2010    2011    2012    2013
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                     DIRECT SPENDING

SCHIP spending under current law:
    Budget authority.........................................   3,175   3,175    4,082    4,082    5,040   5,040   5,040   5,040   5,040   5,040   5,040
    Estimated outlays........................................   4,518   4,885    4,721    4,689    5,024   5,203   5,186   5,340   5,446   5,465   5,443
Proposed changes:
    SCHIP:
        Estimated budget authority...........................   1,259   1,350        5        0        0       0       0       0       0       0       0
        Estimated outlays....................................      85     105      455      590      210      65      45      10       5      80     115
    Medicaid \1\:
        Estimated budget authority...........................       0     -20     -215     -290     -105     -35     -25      -5       0     -40     -55
        Estimated outlays....................................       0     -20     -215     -290     -105     -35     -25      -5       0     -40     -55
SCHIP spending under S. 312 \1\:
    Estimated budget authority...............................   4,434   4,525    4,087    4,082    5,040   5,040   5,040   5,040   5,040   5,040   5,040
    Estimated outlays........................................   4,603   4,990    5,176    5,279    5,234   5,268   5,231   5,350   5,451   5,545   5,558
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ The figures for SCHIP spending under S. 312 do not include the bill's effects on Medicaid spending.

    Basis of estimate: The State Children's Health Insurance 
Program provides federal matching funds to states to provide 
health coverage to certain children--generally in families with 
incomes below 200 percent of the federal poverty level--who do 
not qualify for Medicaid and do not have private health 
coverage. States may provide this coverage by expanding their 
Medicaid programs, setting up a separate program, or a 
combination of the two. SCHIP began operation in 1998 and is 
authorized through 2007. CBO's baseline for later years follows 
statutory rules and assumes funding at the 2007 level. 
(Specifically, section 257 of the Balanced Budget and Emergency 
Deficit Control Act requires that the baseline assume the 
Balanced Budget and Emergency Deficit Control Act requires that 
the baseline assume the continuation of certain expiring 
programs at the level ``in effect immediately before its 
expiration.'')

Availability of SCHIP funds under current law

    SCHIP gives each state an annual allotment that limits the 
amount of federal matching funds that the state can receive. 
States have three years to spend their allotments. At the end 
of the third year, the Secretary of Health and Human Services 
takes any unspent amounts and redistributes them to states that 
have spent their entire allotment. These redistributed funds 
are available for an additional year. After that, any unspent 
allotments expire.
    The Congress enacted special rules for the 1998 and 1999 
allotments as part of the Benefits Improvement and Protection 
Act of 2000 (BIPA). BIPA reduced the amount of unspent 1998 and 
1999 funds that were redistributed to states that had spent 
their entire allotments, and allowed states that did not spend 
all of their funds within the three-year period to keep a 
portion of their allotments. BIPA also extended the 
availability of all funds from the 1998 and 1999 allotments 
through 2002.

Availability of SCHIP funds under S. 312

    S. 312 would change the availability of SCHIP allotments 
for fiscal years 1998 through 2001 in a number of ways. First, 
the bill would extend the availability of the 1998 and 1999 
allotments through 2004. The allocation of those funds across 
states would not be affected.
    For the 2000 and 2001 allotments, the bill would allow 
states that do not spend their entire allotment within the 
three-year period to keep half of the unspent amounts. The 
other half would be redistributed to states that have spent 
their entire allotments. S. 312 would extend the availability 
of all funds from the 2000 allotments through 2004 and the 
availability of all funds from the 2001 allotments through 
2005.
    The bill also would allow certain states to spend up to 20 
percent of their allotments for 1998 through 2001 on children 
who are enrolled in Medicaid and have family incomes greater 
than 150 percent of the federal poverty level. States could use 
these amounts to claim the additional matching funds that they 
would have received if these children were enrolled in SCHIP 
instead of Medicaid and thus reduce the state share of Medicaid 
spending. (The average federal match rate is 70 percent in 
SCHIP, compared to 57 percent in Medicaid.)

How CBO models SCHIP spending

    CBO's primary focus in its baseline projections and 
estimates for legislation in SCHIP spending at the national 
level. Nevertheless, the program's complex financing 
structure--and its redistribution of unspent funds in 
particular--make it essential to account for variation in 
spending across states. Therefore, CBO models SCHIP spending by 
state using a blend of state-specific and national data. These 
projections are meant to reflect the program's complexity given 
the limits of available data rather than provide precise 
spending estimates for each state.
    Our model incorporates the allotments for each state that 
are published annually in the Federal Register and data on 
SCHIP spending from the Centers for Medicare and Medicaid 
Services (CMS). Spending data for prior years includes detail 
by state on the amounts spent from each allotment. For future 
years, CBO projects each state's allotment based on its share 
of total SCHIP allotments for the most recent year. (Total 
funding for the SCHIP allotments varies from year to year.) Our 
estimate of spending in 2003 and 2004 is based on estimates 
that the states have submitted to CMS. We project spending in 
later years by taking the 2004 amounts and adjusting them for 
population growth, inflation, and increased utilization. These 
adjustments are based on national averages and do not vary by 
state.
    The spending projection described above approximates what 
SCHIP spending would be if funding for the program were open-
ended, as in Medicaid. Since SCHIP funding is limited, CBO 
projects spending by limiting expenditures in each state to the 
amounts available from the allotments and any redistribution of 
unspent funds.
    Since SCHIP allotments are available for three years, 
states typically have allotments from several years available 
at any one time. For example, this year a state could have 
funds from the 2001, 2002, and 2003 allotments available. 
(States that qualify for a redistribution also would have funds 
from the 2000 allotment available.) In line with CMS 
regulations, CBO assumes that states will spend their 
allotments in order--they will spend their 2001 allotment 
before spending any of their 2002 allotments, and so on. 
Redistributed funds are the only exception to this rule; CMS 
gave states some flexibility in spending redistributions from 
the 1998 and 1999 allotments, and CBO assumes that they would 
do so for future redistributions.
    CMS has not announced how it will allocate unspent funds 
among states that qualify for a redistribution. Redistributions 
from the 1998 and 1999 allotments (the only ones that have 
happened so far) were based on the special rules enacted in 
BIPA. We assume that unspent funds will be redistributed among 
qualifying states based on their original allotment for that 
year.
    As noted above, SCHIP spending in some states will be 
restricted by the availability of allotments. This will be 
increasingly prevalent after 2007, when CBO's baseline holds 
SCHIP funding constant at the 2007 level. In these cases, CBO 
assumes that states will offset some of the funding shortfall 
by expanding Medicaid eligibility. Doing so will allow states 
to receive additional matching funds, albeit at a lower match 
rate. We assume that higher Medicaid spending would offset the 
full amount of any shortfall in SCHIP programs that were 
implemented as Medicaid expansions (about 20 percent of total 
spending) because children in those programs are entitled to 
Medicaid if SCHIP funding is unavailable. CBO also assumes that 
half of any shortfall where SCHIP was implemented as a separate 
program (and children are not automatically entitled to 
Medicaid) would be offset by higher Medicaid spending.

Budgetary effects of S. 312

    The provisions of S. 312 would increase the amount of 
budget authority in SCHIP by extending the availability of some 
allotments that would otherwise expire under current law. CBO 
estimates that the increases under the bill would total $1.3 
billion in 2003, $1.4 billion in 2004, and $5 million in 2005.
    CBO estimates that enacting S. 312 would increase SCHIP 
outlays by $85 million in 2003, $105 million in 2004, and $1.8 
billion over the 2003-2013 period. Most of the additional 
outlays in 2003 and 2004 would occur in states that under the 
bill would be able to spend some of their allotments on 
children enrolled in Medicaid.
    The additional spending for most states would occur 
primarily in 2005, 2006, and 2007. Spending in earlier years 
would not be affected by the bill because states generally have 
sufficient allotments under current law to fund their programs 
in those years. However, the bill would let states fund their 
spending in those years by drawing more heavily on older 
allotments, such as those for 1998 and 1999. This would allow 
states to conserve their newer allotments and would lead to 
additional spending after 2004, when more states would 
experience funding shortfalls under current law.
    By making allotments available for a longer period of time, 
S. 312 would lessen funding shortfalls in SCHIP and reduce 
states' use of Medicaid funding to offset them. In total, CBO 
estimates that the bill would reduce Medicaid spending by $20 
million in 2004 and $790 million over the 2004-2013 period. 
Savings in 2003 and 2004 would be relatively small because much 
of the additional SCHIP spending in those years would be due to 
states claiming additional matching funds on children enrolled 
in Medicaid rather than a reduction in funding shortfalls.
    Intergovernmental and private-sector impact: S. 312 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. The bill would give states more time to spend 
unused SCHIP funds from their allotments for fiscal years 1998 
through 2001. Certain states also would be able to use some of 
those funds on behalf of children in Medicaid with family 
incomes above 150 percent of the federal poverty level. CBO 
estimates that state spending for SCHIP would increase by about 
$690 million over the 2003-2013 period, and state spending for 
Medicaid would decline by about $750 million over the same 
period.
    Estimate prepared by: Federal costs: Eric Rollins and 
Jeanne De Sa; impact on state, local, and tribal governments: 
Leo Lex; impact on the private sector: Kate Bloniarz.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                        V. VOTE OF THE COMMITTEE

    On June 12, 2003, a substitute for S. 312, entitled, 
``Availability of SCHIP Allotments for Fiscal Years 1998 
through 2001,'' was ordered favorably reported by a voice vote 
with a quorum present.
    No amendments were offered.

                      VI. CHANGES IN EXISTING LAW

    In the opinion of the Committee, it is necessary in order 
to expedite the business of the Senate, to dispense with the 
requirements of paragraph 12 of rule XXVI of the Standing Rules 
of the Senate (relating to the showing of changes in existing 
law made by the bill as reported by the Committee).

                                
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