Barry Senterfitt
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The Children's Health Insurance Program Reauthorization Act and the American Recovery and Reinvestment Act (the economic stimulus
legislation) contain broad-reaching healthcare related provisions affecting insurers, providers, employers and employees.
The reinvestment act contains more than $100 billion for healthcare measures including, among many other provisions, subsidies
to help unemployed workers afford healthcare coverage through COBRA and legislation aimed at the promotion of health IT.
Janet Farrer
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In February, the Children's Health Insurance Program Reauthorization Act of 2009, which reauthorizes the State Children's
Health Insurance Program (SCHIP) through 2013, was signed into law. The act expands SCHIP eligibility through a number of
measures. The most significant measure seeks to use a 61-cent increase in the cigarette tax to cover 4 million additional
children.
The act seeks to insure more children by giving states the authority to cover children whose families have an income as high
as 300% of the federal poverty level (FPL), which is about $66,000 for a family of four. The act also expands SCHIP's coverage
by authorizing the expenditure of an additional $32.8 billion in federal funds and allowing legal immigrants to qualify for
SCHIP. Legal immigrants were previously generally barred from Medicaid and SCHIP for five years after they entered the United
States. Although the act diminishes the previous delay for legal immigrants, it does not open the program to undocumented
immigrants who are still ineligible for coverage.
COBRA The recent economic stimulus legislation contains laws that significantly affect the way that COBRA is administered. It provides
more than $21 billion to subsidize 65% of what an individual must pay to continue health coverage under COBRA. Subject to
some exceptions, such as exceeding income threshold limits, the subsidies apply to employees involuntarily terminated between
Sept. 1, 2008, and Dec. 31, 2009, who are otherwise eligible for COBRA.
Covered employees will have 60 days from receipt of the notification to elect COBRA coverage. Covered employees will have
access to the COBRA subsidy for up to nine months, provided that the subsidy will terminate earlier if the covered employee
becomes eligible for Medicare or another qualifying group health coverage.
HEALTH INFORMATION TECHNOLOGY
The reinvestment act also contains legislation dedicated specifically to health IT that is designed to, among many other goals,
improve quality, reduce repetitive testing, and decrease medical errors. Further, the legislation requires the "utilization
of an electronic health record for each person in the United States by 2014."
To assist in achieving these goals, the legislation creates and appropriates $2 billion to the Office of the National Coordinator
for Health IT for overseeing health IT advancement. The legislation provides a number of incentives to eligible Medicaid and
Medicare providers who are "meaningful users" of electronic health technology by a certain time. Subject to some exceptions,
penalties are also provided for eligible professionals who are not "meaningful users" of electronic health technology by 2015.
This column is written for informational purposes only and should not be construed as legal advice.
Barry Senterfitt is a managing shareholder at Greenberg Traurig, LLP, Austin, Texas.
Janet Farrer is an associate at Greenberg Traurig LLP, Austin, Texas.
