Sen. Toomey Issues Statement on Children’s Health Insurance Program Rescission

WASHINGTON, May 18 -- Sen. Patrick J. Toomey, R-Pennsylvania, issued the following statement, which was published in the Congressional Record on May 16, on the Children's Health Insurance Program rescission:

Mr. President, the second topic I wish to touch on today is a subject that is apparently misunderstood, and it is certainly wildly mischaracterized. It is the subject of rescissions. It has become a topic of conversation since the President--the administration--has proposed a rescission. A rescission relates to our budget process. It is when money originally authorized by Congress to be spent on a program but actually is not spent--that authorization is revoked, it is rescinded, but it is with respect to money that was never spent.

Now, specifically, I want to discuss how this relates to the Children's Health Insurance Program, which is often referred to by the acronym CHIP--the CHIP program. So if you follow recent media reports and comments by some of our colleagues, and even some industry stakeholders, boy, it sure seems like there is a lot of confusion.

Let me state an unequivocal fact. Since 2011, there have been rescissions from CHIP every single year. This is not new. It has happened every single year since 2011.

Now, is that because Congress decides during the course of each year that they don't really like the CHIP program or they don't like children or they don't want kids to get health insurance? No, that is not why it happens. The reason it happens each and every year is because Congress systematically, intentionally, and willfully authorizes far more money for the CHIP program than it is ever going to actually spend.

We have a chart that illustrates this. We can see the vertical columns. The red bars show how much money Congress has authorized in the years to the left of the dotted line. Those are historical years. To the right of the dotted line is the projected future years. So the red bars are how much money Congress has authorized for the CHIP program. The green line shows how much of that money actually gets spent on the program. We can see that in each and every year the red bar is way above the green line. It has been going on back to 2009; it is every single year, and if we continue on our current path, that will continue to be the case as far as we can see going into the future.

Now, take a particular year; for example, this year, 2018. We expect the Federal Government is going to spend $16 billion on the program. Now, because of the nature of the way this program works and certain features, it is possible we will spend $16.1 billion. It is possible it will end up being $15.99 billion, but we know $16 billion is enough to provide the Federal share of funding for the children enrolled by their States, but, as I say, we don't know it with precise precision right to the last dollar.

So knowing it is going to be about $16 billion, how much money do we think Congress authorized for this program that is going to cost $16 billion? The answer is $25 billion. So $25 billion, when we know for a fact--everybody, including our Democratic colleagues, knows we are not going to spend anything close to that amount of money. As I say, this overfunding is not unique to 2018; it happens each and every year, and it will continue well into the future.

Now, within that $25 billion, I should point out a subset. There is something called the Child Enrollment Contingency Fund. In 2018, $4.3 billion of the $25 billion is designated for this Child Enrollment Contingency Fund. The word "contingency" is there because it is meant, theoretically, to be a backstop in case the demand--the utilization--for this program is so great that the allocated money isn't enough, so there will be this contingency fund. That raises a question: Is that a sensible number, $4.3 billion?

Well, let's look at this. Since 2009, there has been a total of $11.4 billion made available in this very category, this contingency fund. That is represented by the blue circle on the chart. How much has actually been needed? The answer is $100 million--one-tenth of $1 billion. Nine-tenths of 1 percent of the amount of money that has been made available has actually been used for this purpose, and $11.4 billion was authorized in the decades since this contingency fund was invented.

During that period of time, all 50 States and the District of Columbia, if they ever needed it, would have been able to access this. That 50, plus 1, over the course of 9 years, is 460 opportunities for a State or the District to come to the Federal Government and say: We need some of that money from the contingency fund--460 times. How many times has it actually occurred over the course of those 9 years? The answer is three, and the amount of money is less than 1 percent of what has been authorized: $108 million used out of $11 billion that has been authorized.

Well, next year, according to State law, despite the fact that no State is even close to consuming the full amount of the main fund, we are going to allow another $4.5 billion to be deposited in this account, when the sum total of all the States' usage for the last 9 years was $100 million, one-tenth of $1 billion.

Look at it another way. If you look at all the CHIP-related accounts--all the Federal money that has been designated for this children's health program since 2009--Congress has willfully and systematically authorized so much in excess of what is needed that actually only 58 percent of the money has gone to the CHIP program because that is all the demand there was for this program.

So this, obviously, raises a question: Why is it that year after year after year, including this year, Congress intentionally authorizes so much more funding than we are ever going to spend on this category, on this program, on the children's health program? I will tell my colleagues why. It is a big budget gimmick. It creates a big opportunity for Congress to lie to the American people and spend more money on other programs under the guise of putting it toward the children's health program.

How does this work? Every year, as I mentioned at the beginning of my comments, after knowingly authorizing way more money than is needed, Congress comes back and says: Oh, you know what, let's do a rescission, but we will take this money out of CHIP, and we will spend it on something else. It could be spent on anything else, whatever the politically favorite cause is of the moment, but buried somewhere in a 1,000-page appropriations bill every year there has been a rescission, and the money has been shifted to something else. Basically, it becomes a slush fund to be used in the appropriations process and to allow the appropriations to exceed the cap on spending that we all agreed upon.

So that is what happens. Congress willfully creates a number way above what we are going to spend, comes back a little later and says: Oh, my goodness, look at all this leftover money. Well, let's just take it and spend it somewhere else.

It is completely dishonest. It completely misrepresents the CHIP program. It completely misrepresents--in fact, it blatantly violates the spending caps we have established, and it is not trivial. It is not a trivial amount of money. Over the last 8 years, the amount of these rescissions, so it can be spent elsewhere, has added up to 45 billion taxpayer dollars--entirely a gimmick, a device that just allows Congress to lie to the American people about what they are spending.

So that brings us up to last week. The administration comes along and says they have a suggestion for Congress. First of all, let's fully fund the CHIP program. Let's make sure the CHIP program is fully funded. There will be no shortage whatsoever, but let's stop the lying. Let's remove the deception. Let's provide a reasonable amount of excess funding, because I acknowledge at the beginning we don't know right down to the last dollar exactly how much we are going to spend, but let's take aside all of this wild excess.

Let's be honest. Let's rescind now most of the excess funding, which has been going on each and every year separately; let's leave more than enough in the contingency fund. Even though it is extremely unlikely that any of it will be tapped, the administration has proposed $500 million to be left in the contingency fund. Remember, that is the fund that has been used to the tune of $108 million over the last 9 years, but they are saying let's leave $500 million--five times as much as has been spent cumulatively over the last 9 years--and basically send all of this huge, excessive amount back to the Treasury so it is not just spent willy-nilly and irresponsibly.

Now, for some reason, despite the fact that not a single dollar that would have actually been spent on the CHIP program will be spent differently, will not be spent; despite the fact that the CHIP program will not lose a single dollar of actual funding; despite the fact that Congress has been doing this every single year since 2011, as long as it can spend it on something else; despite the fact that 65 Senators, including 40 of my Democratic colleagues, voted to rescind $6.8 billion from CHIP--how long ago? In March of this year, a few weeks ago, including $3.1 billion from the contingency fund. So the vast majority of my Democratic colleagues voted to rescind money from CHIP just earlier this year. Despite that, now we have people up in high dudgeon, wailing and gnashing of the teeth, about how what we are doing would tear CHIP apart--even after what they did in March, by the way--that it is somehow a betrayal, immoral, appalling; it hurts low- and middle- class families.

It would be too generous to suggest this is merely a lapse of memory. Everybody knows what is going on. This is ridiculous.

So I fully support the President's proposal that we fully fund CHIP but stop with the dishonesty in our budgeting. Stop throwing a bunch of money under this category, knowing we are going to go back later and spend it somewhere else. This program shouldn't be pillaged this way to spend money on unrelated things that just allow us to bust the budget cap.

I would go a step further. What the administration has proposed, to their credit, fixes this terrible flaw this year. I would like us to permanently fix it. I have suggested to my colleagues, rather than specifying a dollar amount, since we don't know the precise dollar amount, I would be OK with a provision that says: such sums as will be needed. That would guarantee it would be fully funded, but it would not create this big excess that gets wasted on who knows what.

If the only concern people have is to ensure that the CHIP program will be fully and properly funded, how can they object to that? It would specify, codified in language, that would be exactly what would happen. It would be fully funded, but we have gotten this resistance to that. How could that possibly be? Unless it is that people want to continue this gimmickry, this deception that has been going on for all of these years.

Well, I hope we will be able to work out a long-term solution. I hope we will bring an end to this. I understand my colleagues on the other side want to spend more money. Let's just admit it--admit it, and let's debate it. We have agreed-upon spending caps. I think they are too high, but that is what we agreed upon. We shouldn't be lying to the American people and going through this gimmick yet again.

So I want to state my unequivocal support for the administration's proposal for a rescission package. I would prefer if there were actual spending being cut. This is indirectly going to help reduce excessive spending because it is going after these unobligated funds, it is going after these excessive accounts. It happens in other accounts, but CHIP is the most noteworthy. To me, this is a modest step in the direction of honest budgeting and protecting the taxpayers.

I hope we will be able to have a permanent solution to this soon, but in the meantime, I hope my colleagues will support the administration's rescission package.

I yield the floor.