Southern California -- this just in

« Previous Post | L.A. NOW Home | Next Post »

Health insurance for children in doubt

December 14, 2009 |  4:32 pm

Federal health officials are casting doubt on a last-gasp funding scheme by California to keep nearly 700,000 children from being yanked from a government health insurance program for the working poor.

U.S. health officials say the plan adopted by the state in the final days of the legislative session and signed into law by Gov. Arnold Schwarzenegger may not meet regulatory muster.

As a result, children’s health advocates are warning that by the end of next year, hundreds of thousands of children could lose their health insurance -- even as the Obama administration continues its push for universal healthcare.

“This would have devastating consequences,” said Wendy Lazarus of the Children’s Partnership. “I really can’t believe the Obama administration wants something like this to happen at the time they’re trying to make healthcare more stable for all Americans, particularly the kids.”

Facing huge funding cuts to the Healthy Families program, the state Legislature passed a measure extending a 2.35% tax to health insurance plans for the poor to help raise nearly $100 million to keep Healthy Families afloat.

But officials at the Centers for Medicare and Medicaid Services told the state in a letter last month that a preliminary review of the proposal found that it failed to meet its reading of the rules for such taxes.

“We recognize that the California Legislature may need to adjust state laws. We will work with the state to clarify policy and resolve any outstanding issues,” said Cindy Mann, director of the Centers for Medicare and Medicaid Services.

-- Eric Bailey in Sacramento