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The Federal Budget

Slow Growth in Health

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Tuesday, February 6, 2007

President Bush would increase current funding levels for the state-federal Children's Health Insurance Program by $5 billion over the next five years -- far short of the $12 billion or more that experts say is needed to keep covering the 6 million children now in the program. The program, which costs about $5 billion annually, helps provide health coverage to children whose families earn too much to qualify for Medicaid but still cannot afford insurance on their own. The administration wants states to focus on serving children whose families earn 200 percent of the poverty level, or $41,300 for a family of four.

Senate Finance Committee Chairman Max Baucus (D-Mont.) said, "Congress must do more to fund the Children's Health Insurance Program than the president suggests here."

In Medicare and Medicaid, which serve nearly 93 million Americans, Bush would slow growth in spending for both programs by a combined $101 billion over five years, partly through changes in Medicare payments to hospitals, nursing and rehabilitation facilities, and home health agencies, and through changes in the way Medicaid pays for prescription drugs. He also proposed triggering across-the-board cuts in provider payments if Medicare spending reaches certain levels.

In the Medicare prescription drug benefit, individuals who earn more than $80,000 annually (and couples who earn more than $160,000) would have to pay higher premiums than less affluent beneficiaries enrolled in the same drug plans. The change would affect 1.1 million people in 2008.

-- Christopher Lee


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