Automatic enrollment can dislodge health bill

Last Thursday’s failed vote on children’s health care was the latest example of politics at its worst. Both sides were unwilling to compromise, and in the end, not one House Republican changed votes.

Even worse, the sides became more entrenched. Speaker Nancy Pelosi says the goal of covering 10 million children is “non-negotiable,” while President Bush insists that he will veto any bill that does not prioritize coverage for low-income families and encourages people with private insurance to switch to public insurance (also known as the “crowd-out effect”).

American opinion has also become increasingly divided.

Although nearly 80 percent of Americans are in favor of S-CHIP reauthorization, a recent Gallup poll reported that 55 percent of Americans are concerned that “expanding this program would create an incentive for middle-class Americans to drop private health insurance for a public program, which some consider a step toward socialized medicine.”

At this critical juncture, it’s time to get beyond our divisions and focus on the next step. I could write this whole column countering the claim that expanding S-CHIP is not a step toward socialized medicine, but more of the same partisan rhetoric will only get us to the same impasse where we were one week ago.

Instead, I have a new idea for a compromise. By using electronic information that is already available, the federal government could automatically enroll more children who are already eligible for S-CHIP and Medicaid while reducing unneeded bureaucracy and crowd-out at the same time.

The concept of automatic enrollment is not new. For example, Medicare Part B and Part D, as well as the new Massachusetts health plan, have already had much success using existing government information on age and income to automatically enroll eligible citizens for government programs.

Last spring I wrote about automatic enrollment as it applies to S-CHIP for the Roosevelt Institution, and in August, Stan Dorn from the Urban Institute published a comprehensive policy brief on the topic for the Robert Wood Johnson Foundation. It’s worth revisiting this issue, however, since it may be critical for today’s policy debate.

In the context of children’s health insurance, automatic enrollment is an innovative way to reach nearly all of the estimated six million children who are eligible, but not enrolled in Medicaid and S-CHIP. While Congress’s current bill plans to cover about four million of these children, using information that the government already collects on tax forms such as the EITC or W-4 could provide an easy, electronic way to identify and to insure virtually every eligible child. Families would still have a choice to opt out of S-CHIP and privacy would be protected. The only difference would be that working families wouldn’t have to fill out the same information twice. For the most technologically advanced country in the world, it is only common sense to coordinate this information and make enrollment easier for consumers.

Streamlining existing data for automatic enrollment can also help address issue of crowd-out and citizenship status. Until recently, a complicated set of regulations known as ERISA essentially prohibited states from accessing information about private insurance. Yet, a little known provision in Section 6035 of the Deficit Reduction Act of 2005 now mandates states to collect information on private insurance coverage, including ERISA plans. Section 6036 of the same legislation also includes some provisions that may help identify citizenship. As a result, these databases could be cross-listed easily with S-CHIP applicants to prevent fraud and abuse.

In the end, the numbers add up. About two million kids who would likely be eligible but not enrolled under the current proposal will take the place of about two million kids who would have been expected to switch from private to public insurance. Democrats will win their “non-negotiable” goal of covering 10 million kids total, and Republicans can claim victory on refocusing the program towards poorer families who are already eligible while at the same time reducing unneeded bureaucracy.

Moreover, this plan requires few changes to the existing legislation. Section 203 of the most recent bill already supports demonstration programs for automatic enrollment in ten states. This policy would need to be expanded to eventually cover all 50 states, and some additional clarifications would be needed to ensure that states can use data to reduce crowd-out.

Obstacles still remain, such as overcoming opposition to the increased tobacco tax, but this small bit of creative policy making might just be enough to convince the 10 Republicans who are currently in the way of health insurance for 10 million kids.

Rep. Michele Bachmann from Minnesota, who voted against the bill, said in the aftermath of Thursday’s vote that Congress now has an opportunity to “show the American people that we are here to solve problems.”

Indeed, it’s time for politics at its best.

Robert Nelb is a senior in Timothy Dwight College. His column runs on alternate Tuesdays.

Comments