September 24, 2007 | WebMemo on Health Care
On September 21, House and Senate leaders announced a deal to expand the State Children's Health Insurance Program (SCHIP) by $35 billion over five years, to $60 billion. This "compromise" does little to bridge the differences in opinion on how best to address the needs of uninsured children. Instead, Congress should consider a bipartisan approach that is broad and balanced. Congress should reauthorize SCHIP and use innovative policy tools to expand access to private coverage for children.
The Shortcomings of the SCHIP Compromise
The compromise reflects the less extreme bill passed by the Senate and drops the Medicare provisions found in the House bill. However, based on the Senate-passed bill, the following fundamental problems remain:
Needed: A More Balanced Approach to Covering
The current debate over expanding health care coverage for children has focused exclusively on SCHIP. Members of Congress should expand the discussion to include innovative policy ideas. Specifically, a reasonable compromise could be formed around three simple concepts:
The compromise proposal turns SCHIP into a vehicle for incrementally expanding government-run health care and undermining the private model. With the President reaffirming his threat to veto the current proposal, it is clear that Congress will need to go back to the drawing board if it is serious about reauthorizing SCHIP and expanding coverage to more children.
A more balanced compromise would combine the approaches preferred on both sides of the political spectrum. Earlier this year, agreement on a very similar approach was reached by a wide coalition of organizations, including the U.S. Chamber of Commerce, the American Medical Association, America's Health Insurance Plans, and Families USA. Congress should reauthorize SCHIP and use innovative policy tools to expand access to private coverage for children.
Nina Owcharenko is Senior Policy Analyst in the Center for Health Policy Studies at The Heritage Foundation. Stuart M. Butler, Ph.D., is Vice President of Domestic and Economic Policy Studies at The Heritage Foundation.
 Paul L. Winfree and Greg D'Angelo, "SCHIP and "Crowd-out": The High Cost of Expanding Eligibility," The Heritage Foundation Web Memo No. 1627, September 20, 2007, at www.heritage.org/static/reportimages/42187B869FCC1789EFD627A58E432978.pdf.
 Michelle C. Bucci and William W. Beach, "22 Million New Smokers Needed: Funding SCHIP Expansion with a Tobacco Tax," The Heritage Foundation Web Memo No. 1548, July 11, 2007, at www.heritage.org/static/reportimages/F9C5E6A39FF6A8EDF8BCDC3418FD822E.pdf.
 Stuart Butler, "The Voinovich-Bingaman Bill: Letting the States Take the Lead in Extending Health Insurance," Heritage Foundation Web Memo No. 1128, June 15, 2007, at www.heritage.org/static/reportimages/B696DEECDDC7668F2208C161E5BCF463.pdf and Stuart Butler and Nina Owcharenko, "The Baldwin-Price Health Bill: Bipartisan Encouragement for State Action on the Uninsured," Heritage Foundation Web Memo No. 1190, August 7, 2006, at www.heritage.org/static/reportimages/9FCB24CDEA2B0652E7B80EC4E4697573.pdf.