October 3, 2007

October 3, 2007 | Commentary on Health Care

A Better Way to Achieve Health Care for Needy Kids

Congress has two options, now that President Bush has vetoed its effort to expand the State Children's Health Insurance Program (SCHIP) well beyond the original purpose of providing health insurance to poor children: 

1) Keep posturing over which politicians most want to help kids in an election year.

2) Pass an alternative that actually helps struggling families afford health insurance for their kids - and allows each side to claim some victory.

Despite the pressure politics now unfolding, it appears unlikely the House will override the president's veto of the $35 billion expansion of SCHIP.

The president had proposed a 20 percent increase for SCHIP of $5 billion, focused on covering more children from low-income families who don't qualify for Medicaid. But Congress' SCHIP expansion would have crowded millions of children from middle-income families into inferior, government-run Medicaid programs or, at best, HMO plans.  An analysis by my colleagues at The Heritage Foundation shows that as many as six of every 10 of these children would be  pulled into this government maze from their parents' private health insurance plans.

With the veto, some may assume the political gridlock will continue.  However, The Heritage Foundation recommends an alternative plan to enable more needy children to get coverage - a plan that incorporates ideas from across the political spectrum.

The Heritage alternative, "SCHIP Plus," embodies an approach that already has the backing of the American Medical Association, AARP, Families USA (a left-leaning health reform group), the U.S. Chamber of Commerce, and top insurance and hospital associations.

This approach incorporates three important principles:

  • Improve SCHIP coverage for children below 200 percent of the poverty line ($41,300 for a family of four) while continuing coverage for better-off kids already enrolled by some states.
  • Provide tax relief for families with incomes up to three times the poverty line (as much as $61,950 for a family of four) to help them buy private health insurance for their families - or keep the coverage they're struggling to maintain.
  • Give states latitude to use existing federal programs to expand coverage, based on bills introduced by Reps. Tammy Baldwin, D-Wis., and Tom Price, R-Ga., and Sens. Jeff Bingaman, D-N.M., and George Voinovich, R-Ohio.

The  "SCHIP Plus" approach doubtless would provide health coverage to far more children in need than the vetoed SCHIP expansion. The only question is: Are lawmakers more interested in helping children or in scoring political points?

Michael Franc is vice president of government relations for The Heritage Foundation (heritage.org).

About the Author

Michael Franc Distinguished Fellow
Government Studies