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BattleSCHIP: The Senate and President Bush Square Off

July 17, 2007 - by Donny Shaw

A bipartisan group of Senators are set to make the opening move in a battle between Congress and the President over reauthorizing a program to provide poor children with health insurance. The State Children’s Health Insurance Program (SCHIP), which provides health care to children whose families aren’t poor enough to receive Medicaid but can’t afford to buy private insurance, was set in motion ten years ago and it is scheduled to run out on September 30th of this year. The stakes are high. If neither Congress nor the President budge on the positions they have taken over reauthorizing the program, no bill will be signed and 6.6 million children will suddenly be uninsured.

Last week, the Senate Finance Committee reached an informal agreement on a compromised reauthorization proposal that they think can pass muster in the Senate. Members from both parties made concessions: Democrats took $15 billion off of what they had hoped to get for the program, Republicans attached a provision to keep some states from covering adults under SCHIP, a tobacco tax was added to pay for the funding increase, and a provision to encourage states to fund children who are currently eligible was added.

The Committee is scheduled to put their official stamp of approval on the compromised bill this evening, but they will be doing it while staring down the barrel of Bush’s veto pen. President Bush has threatened to veto the reauthorization bill before it has even made it out of committee. Here’s how he made his case against the bill to an audience in Cleveland on July 10th:

>The best health care policy is one that emphasizes private health. In other words, the opposite of that would be government control of health care. And there’s a debate in Washington, D.C. over this. It’s going to be manifested here shortly by whether or not we ought to expand what’s called S-CHIP. S-CHIP is a program designed to help poor children get insurance. I’m for it. It came in when I was the governor of Texas; I supported that. But now there are plans to expand S-CHIP to include families — some proposals are families making up to $80,000 a year. In other words, the program is going beyond the initial intent of helping poor children. It’s now aiming at encouraging more people to get on government health care. That’s what that is. It’s a way to encourage people to transfer from the private sector to government health care plans. …
>I mean, think of it this way: They’re going to increase the number of folks eligible through S-CHIP; some want to lower the age for Medicare. And then all of a sudden, you begin to see a — I wouldn’t call it a plot, just a strategy — (laughter) — to get more people to be a part of a federalization of health care.

But since the Finance Committee’s compromise proposal was announced on July 13th, the Congressional Budget Office (CBO) issued a report that contradicts the President’s claims of an expansion into higher income families. According to the Center on Budget and Policy Priorities, the CBO report indicates that the vast majority of the proposed SCHIP increase would go towards covering children who qualify under the program’s “initial intent,” but are not currently covered due to a lack of funding:

>Congressional Budget Office estimates show that 4.1 million children who otherwise would be uninsured would have health care coverage by 2012 under the bipartisan children’s health legislation the Senate Finance Committee unveiled July 13. CBO estimates that 2.7 million of these children are uninsured children who would already be eligible for the program under the current eligibility limits that states have set in the State Children’s Health Insurance Program (SCHIP) and Medicaid,1 and another 800,000 are SCHIP children who would otherwise lose their coverage in coming years and end up uninsured under the “budget baseline” (because states would have insufficient federal SCHIP funding to sustain their existing programs)
>As a result, CBO estimates that 3.5 million of these 4.1 million children — 85 percent of them — are children with incomes below the current eligibility limits that states have set. Only 600,000 of the 4.1 million children who would otherwise be uninsured are children who would gain SCHIP eligibility as a result of actions by states to broaden the program’s eligibility criteria.

SCHIP is designed to allow the individual states to use the money as they see fit. It can be combined with Meicaid, used in combination, or kept completely separate. President Bush has even allowed 14 states to use SCHIP money to cover some adults (a practice which would be phased out by the current proposal). But the compromise reauthorization bill under consideration contains a provision to prevent states from using the money to provide health care for children above 200 percent of the federal poverty level. The proposal would set aside a certain amount of the appropriated money in an incentive pool that would be redistributed to states based on the progress they make with insuring children below the 200 percent line. So, the proposal props up states that stick with SCHIP’s “initial intent” of insuring poor children and punishes those that try to expand beyond it.

There has been some pressure on Bush from Republican senators urging him to back off his threatened veto of the bill, but so far he is sticking to his guns. And as the following excerpt from CongressDaily ($) indicates, the proposal’s crafters on the Finance Committee think that any adjustments to the compromise would cause it to stall in the Senate:

>"I put the $50 billion in the budget," said Budget Chairman Conrad, who also sits on the Finance Committee. “But the hard reality is that you need 60 votes, and this agreement is really the only prospect of getting a supermajority vote.” Sen. Ken Salazar, D-Colo., echoed Conrad’s statements today. “We need to strive for what is doable,” he said.

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