GOP Hopes to Score Populist Points With Children’s Health Bill

As they prepare for Democratic attacks on their tax-reform package, conservatives want to use the CHIP bill to make the wealthy pay more for Medicare.

Rep. Mark Meadows emerges from a House Republican Conference meeting on July 28.
AP Photo/J. Scott Applewhite
Daniel Newhauser and Erin Durkin
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Daniel Newhauser and Erin Durkin
Nov. 1, 2017, 8 p.m.

House conservatives are determined to use a children’s health care bill to bolster their populist bona fides—and they’re willing to fight their own leadership to do so.

As they prepare for attacks from Democrats that their tax bill benefits the wealthy, conservatives are relying on legislation to extend the funding for the Children’s Health Insurance Program to boost their credibility. They want the bill to essentially cut some assistance from higher-income Medicare beneficiaries to provide money to low-income kids.

The Energy and Commerce Committee passed legislation that included a provision to make higher-income Medicare beneficiaries pay more in premiums. Then, Chairman Greg Walden submitted an amendment that would have removed this offset and instead dipped further into the Affordable Care Act’s prevention and public health fund.

But Tuesday evening, House Freedom Caucus Chairman Mark Meadows and some of his colleagues confronted House Majority Leader Kevin McCarthy on the House floor asking that he leave the bill as it was passed out of committee.

“The bill the committee passed out helps kids and means-tests Medicare recipients, Part B, and would increase their premiums, and that’s certainly something I support,” Meadows said Tuesday night, after a Freedom Caucus meeting. “I don’t know that there’s anybody, again, that would be willing to vote against needy children that need help,” he added.

The offset, which would increase premiums on beneficiaries making more than $40,000 per month, was put back into the legislation Wednesday afternoon during a meeting of the Rules Committee.

Conservatives are pleased by the idea of going back to the original plan. “I think we like that version,” Rep. Jim Jordan said.

The call to change the Medicare pay-for came at the behest of Ways and Means Chairman Kevin Brady, who wanted to use the offsets either for tax reform or another measure in the future, according to two sources with knowledge of the matter. Republican leaders have been struggling to find a way to pay for their pricey tax legislation since members from high-tax states such as New York, New Jersey, and California have balked at attempts to scale back the state and local tax deduction.

Coming out of their weekly meeting, Freedom Caucus members framed their objection to the change as a matter of regular order. They are sick of leadership changing committee-passed bills at the 11th hour, as it did with legislation from Financial Services Committee Chairman Jeb Hensarling, they said.

“It’s about the process of regular order,” caucus member Mark Sanford said. “The group feels burned by what happened with flood insurance with Hensarling and the way that went through regular order, [but if] you can’t come up with a solution, you get stripped out.”

Still, sources noted that behind the scenes, other motivations were at play.

Democrats have been against the offsets in the legislation, which also extends funding for community health centers.

So if House Republicans pass the bill, they can feasibly say they took money from the wealthy to pay for sick children while Democrats stood idly by. The line will be used as a counterattack when Democrats tar the GOP tax plan, scheduled to be released Thursday, for being too generous to the wealthy.

The National Republican Congressional Committee has already been using the committee vote to attack Democrats. A press release expressed disbelief that a targeted Democrat, Rep. Raul Ruiz, “chose taxpayer subsidies for millionaires over health insurance for kids? Classy. Good thing he’ll be held accountable for it in 2018.”

The House wrangling comes as the children’s health bill is likely a nonstarter in the Senate—at least for now.

“I know that in effect what we’re doing today … is essentially punting until the end of the year,” said Energy and Commerce Committee ranking member Frank Pallone during the Wednesday hearing. “In other words, the Senate isn’t going to take these bills up, and as a consequence it waits until the end of the year.”

Waiting comes with downsides. Funding for the children’s health program expired at the end of September, and there are a few states that are expected to run out of funding this year. And states will have to make moves well before the money is gone to start shutting down their programs or preparing to cover kids with reduced help from the federal government.

Utah, for example, is planning to send notices to families this month, although the state’s money is estimated to last through the end of December. This could cause confusion among families, and kids may fall out of coverage, even if Congress eventually extends the program.

Arizona is expected to run through its funds before most states. Four of the state’s congressional representatives are members of the Freedom Caucus.

Arizona had 88,000 kids enrolled in its CHIP program in 2016, according to the Kaiser Family Foundation. But because it is run separately from Medicaid, the state is not obligated to keep those children covered if the program is shuttered. Before the end of September, Arizona was informed that it would get redistributed funding to keep the program for another two months.

“If Congress has taken no action to reauthorize CHIP funding before redistribution funds are exhausted, members enrolled in KidsCare will be notified prior to any program changes,” according to the state’s Medicaid program.

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