WASHINGTON, DC – A new report released today by First Focus, entitled “CMS’ Medicaid Regulations: Implications for Children with Special Health Care Needs,” indicates that the Administration’s new rules for Medicaid and the State Children’s Health Insurance Program, if imposed, will disproportionately affect millions of American children with special health care needs (CSHCN).

The report, commissioned by First Focus and authored by Professor Sara Rosenbaum, JD, Chair of Health Policy at The George Washington University School of Public Health and Health Services, analyzes several regulations issued by the Centers for Medicare and Medicaid Services (CMS), determining that they run counter to Medicaid’s longstanding statutory protections for children. Moreover, the report concludes that the regulations most directly contravene provisions of the statute enacted to provide maximum protection to the nation’s most vulnerable children, including premature infants, children with birth-related disabilities, and children with special health care needs.

“Not only does this report find that the Administration’s recent actions adversely affect our most vulnerable population of children, but it also identifies the many ways in which CMS’ undermines the basic legal protections provided by the Medicaid statute,” said Bruce Lesley, President of First Focus. “Moreover, as a recent study by a House Committee has indicated, these actions, if implemented, would reduce federal payments to states by nearly $50 billion over five years – over three times the impact estimated by CMS. As states battle to counteract the force of the recent economic downturn, this cost-shift to the states will saddle our nation’s most vulnerable children most in need of health care with the burden of paying for it or going without treatment and care. The rules would also reduce billions of dollars to our nation’s schools, which would be faced with the decisions to reduce funding for education and health services or raise state and local taxes to pay for the dramatic reduction in federal support.”

“Special needs” children include those with chronic physical, developmental, behavioral or emotional conditions, as well as those needing health and related services in a type and amount beyond that required by children generally.

Specifically, the report finds:

  • The Administration’s rehabilitation and case management rules contravene the Medicaid early and periodic screening diagnosis and treatment statute (EPSDT), which guarantees comprehensive health care and case management for children, from birth through age 21, particularly children who experience pre-birth or birth-related injuries and whose conditions are present at birth and affect growth and development.
  • CMS regulations virtually eliminate public health nursing case management for special needs children. Public health nursing as a basic Medicaid management activity has been a hallmark of the Medicaid statute for children since 1967, as part of the same Congressional amendments that created EPSDT benefits.
  • By prohibiting the use of schools to administer Medicaid, the regulations are contrary to the statutory requirement of efficiency, since they eliminate the most efficient means available to states to find and enroll children, as well as to manage care for children with special health care needs. As such, the rules directly contravene state agencies’ EPSDT and public health nursing outreach and case management obligations under federal law.

“CMS’ actions appear to be an effort to achieve through regulation the very results rejected by Congress in 2006, namely, repeal of the EPSDT statute,” said Professor Rosenbaum. “The children who risk the greatest harms may be those born with birth-related conditions and disabilities that will affect their normal growth and development and who thus are the most in need of the ameliorative health care and patient and family support services guaranteed by EPSDT.”

The report addresses First Focus’s primary concerns with the regulations, including the notion that the Administration’s regulatory and administrative actions are in violation of the federal Medicaid statute, which guarantees comprehensive health care for children with specials needs. Further, the actions will most profoundly impact the provision of health care and rehabilitation services for CSHCN, especially the use of public health nursing in home, school and other community settings. Moreover, these regulations “would seriously impair the ability of states to assure that special needs children in moderate income families can receive Medicaid or SCHIP.”

Lesley added: “This report is definitive proof that Congress can wait no longer to take immediate action to halt CMS’ attempts to usurp Congressional authority through these regulatory changes to long-standing Medicaid policy. No child who is currently covered under SCHIP or Medicaid should lose their health coverage as a result of the Administration’s actions.”

Report: CMS Medicaid Regulations: Implications for Children with Special Health Care Needs