THE WHITE HOUSE

Office of the Press Secretary

             HEALTH CARE PRIORITIES LEFT UNDERFUNDED DUE TO 
               MASSIVE OVERPAYMENTS TO MANAGED CARE PLANS

Restoring the State options to insure vulnerable legal immigrants. Despite the fact that legal immigrants pay taxes and have typically waited years to come to the U.S., welfare reform prohibited States from extending Medicaid or State Children's Health Insurance Program coverage to legal immigrant children and pregnant women for their first five years in this country. This contributed to the sharp decline in Medicaid and subsequently S-CHIP participation by legal immigrant children (from 37 percent in 1995 to 29 percent in 1999). Restoring this State option would insure 144,000 children and 33,000 pregnant women per year at a 10-year cost of $1.6 billion, and has broad, bipartisan support including that of Governor Jeb Bush.

Fully funding the Ricky Ray Relief Fund. The bipartisan Ricky Ray Hemophilia Relief Fund was enacted to provide one-time $100,000 relief payments to up to 7,500 persons with hemophilia (or their survivors) who contracted HIV while receiving blood clotting factor between 1982 and 1987. However, due to under-funding, approximately 5,000 people with HIV/AIDS or their families are on a waiting list, hoping to get this relief payment while the person infected is still alive. Ricky Ray himself and hundreds of others have died while waiting for this relief and none of the initiatives in Congress includes a dollar of the needed $570 million -- which is only about 1 percent of what they dedicated to managed care overpayments.

Health insurance for children with disabilities. Children with special health care needs are three times more likely to be ill and to miss school. Because of their high healthcare costs, parents often cannot afford private insurance and, instead, forego additional income to maintain Medicaid eligibility. Some even place their children in institutions or give up their children so they remain Medicaid-eligible under unfair and outdated rules. The Family Opportunity Act, which has bipartisan support from 78 Senators, would give States the option of letting families with children with disabilities buy into Medicaid. This commonsense policy builds on the bipartisan Work Incentives Improvement Act and is a wise investment.

Grants to integrate people with disabilities into the community. To address the institutional bias in Medicaid toward nursing homes, my Administration has supported $50 million in System Grants for States, which are part of Senator Harkin's MiCASSA bill, to develop infrastructure that supports community-based care for persons with disabilities. People with disabilities should have real choice in where they want to live, where they receive needed services, in what services they receive, and from whom they are obtained.

Improving nursing home quality. Health and safety are a top concern for both the 1.6 million older Americans and people with disabilities who receive care in nursing homes and their families and friends. Many nursing homes provide high quality care. However, recent reports found that over 50 percent of nursing homes do not maintain the minimum staffing levels necessary to ensure the delivery of quality care. Despite this fact, none of the dollars in the beneficiary and provider restoration initiatives are targeted to increasing the staffing ratios that are linked to increased quality. To rectify this, Republicans have joined Democrats in supporting the Administration's $1 billion State grant program to increase staffing levels by improving staff recruitment and retention, increasing training, and reward nursing facilities with good records.

Eliminating Medicare preventive services cost sharing. The value of preventive benefits is enormous, contributing to early detection, management and cure of diseases that would otherwise be debilitating and costly. However, too few seniors use these services, in part due to today's copay requirements. In the first 2 years that Medicare covered screening mammography, only 14 percent of eligible women without supplemental insurance received a mammogram. Eliminating cost sharing for current services costs about $3 billion over 10 years -- but will save innumerable lives and dollars in the future.

Targeting dollars to vulnerable hospitals and home health agencies. Hospitals and home health agencies have experienced financial distress in the last several years, partly from excessive Balanced Budget Act changes and partly from the shift to managed care which, according to recent studies, pays well below Medicare rates. This distress is particularly acute among hospitals serving low-income patients. While the Commerce Committee made a good start in investing over

$8 billion over 10 years in Medicaid disproportionate share hospital payments, my Administration supports investing more -- $10 billion over 10 years to increase both the State and hospital-specific limits on these payments. In addition, Medicare spending on home health has significantly declined in recent years and an investment in home health care will likely have a greater impact on improving beneficiary access to care than increase managed care payments.

Other critical health priorities. The provider payment restoration bills should also include other important health policies like: Medicaid and CHIP outreach initiatives; Medicaid coverage of smoking cessation; extended Medicare coverage for workers with disabilities; waiver of the waiting period for Medicare for people with Lou Gehrig's disease; home health coverage for people using adult day care; and adequate funding of providers such as teaching hospitals and hospices. In addi-tion, there has been no attempt by the Republican leadership of the U.S. Senate to even allow Committee consideration of legislation for an affordable, voluntary Medicare prescription drug benefit. This failure to act will result in millions of vulnerable seniors and people with disabilities waiting longer to get the relief that they so desperately need.

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