Congrees, Bush Clash Over Children's Health Insurance

By Christopher Lee
Washington Post Staff Writer
Sunday, July 15, 2007

If anything looked like a sure thing in the new Congress, it was that lawmakers would renew, and probably expand, the popular, decade-old State Children's Health Insurance Program before it expires this year.

But the future of the $5 billion-a-year program, which serves 6.6 million children and has long enjoyed bipartisan support, has become mired in an ideological fight over the proper role of government in health care and in more mundane legislative arm-wrestling over how to fund the effort in a tight budget climate.

Key members of the Senate Finance Committee announced a bipartisan deal late last week that would raise the federal excise tax on cigarettes by 61 cents, to $1 a pack, to expand the program by $35 billion over the next five years. That would create total program funding of $60 billion over the period -- enough, lawmakers said, to cover 3.3 million additional kids while keeping the focus on children of the working poor. The committee is expected to vote on the plan as early as this week.

The program, which will expire on Sept. 30, "has helped millions upon millions of low-income, uninsured American kids see doctors when they're sick," Finance Committee Chairman Max Baucus (D-Mont.) said in a statement. "This agreement will make sure that even more children get the health care they need."

House Democrats, meanwhile, have sought an even bigger increase: $50 billion, for a total of $75 billion in funding over five years. It would be paid for, at least in part, by trimming payments to private Medicare plans for seniors. Such an expansion would reach even more of the nation's 8.3 million uninsured children and, more generally, provide a foundation for further efforts to cover more of the 45 million uninsured Americans, they argue.

President Bush has attacked the proposals as big-government attempts to enlarge the federal role in health care, saying they would siphon choice away from individuals and reduce private insurance coverage for some children. He has proposed about $5 billion in new funding for children's health insurance over five years, for a total of $30 billion -- an amount that the Congressional Budget Office says would be too little to keep covering even just the number of children enrolled in the program now.

"The program is going beyond the initial intent of helping poor children," Bush said at an appearance in Cleveland last week. "It's now aiming at encouraging more people to get on government health care. . . . It's a way to encourage people to transfer from the private sector to government health-care plans. . . . I think it's wrong, and I think it's a mistake."

Tony Fratto, a White House spokesman, said yesterday that Bush's senior advisers "will certainly recommend a veto" of the Senate committee's proposal because of its size and the plan to fund it with a tax increase.

"It's important that Congress understands the serious consequences of delaying this or sending the president legislation that he clearly cannot sign," Fratto said.

The president has sought to revive his idea of replacing the long-standing tax break for job-based health insurance with a new tax deduction that would help people pay for insurance regardless of whether they get it through their jobs or on their own.

But Democrats in Congress have shown no interest in it, even after Bush said last month that he would consider a new tax credit to help lower-income people buy private insurance.

Republican Sens. Charles E. Grassley (Iowa) and Orrin G. Hatch (Utah), who helped broker the deal in the Senate Finance Committee, issued a joint statement last week calling Bush's tax code proposals "not realistic" and urging the president not to veto the $35 billion package if it reaches his desk.

"What the administration needs to understand is that if a bipartisan plan isn't achieved, then the Democratic-controlled Congress will, at the very least, extend the current program with all the terrible policy provisions that have evolved, such as waivers for childless adults and coverage for higher-income kids," the senators said.

Begun in 1997, the state-federal program was created to provide health coverage to children whose families do not qualify for Medicaid but cannot afford insurance on their own. While most of those enrolled are from families earning no more than twice the poverty level ($34,340 for a family of three), some states have used the program's flexibility to enroll children from families with incomes above that and to sign up 670,000 adults.

The Senate committee's plan would curb coverage for adults and would require states to pick up a larger share of the cost of coverage for children above 300 percent of the poverty level, or $51,510 for a family of three.

Reaction to the Senate proposal among children's advocates was mixed. Cindy Mann, executive director of the Georgetown University Center for Children and Families, called it "a significant effort" to insure the lowest-income children that nevertheless will leave millions without coverage.

Bruce Lesley, president of the Alexandria-based nonprofit First Focus, said limiting growth to $35 billion would be "a serious setback for children with and without public health coverage."

For people such as Beverly Chappell, 43, a Web site developer in Thornton, N.H., the debate is about health and family, not ideology. Chappell and her husband, David, 49, a self-employed carpenter, earn a total of $43,000 a year and for years could not afford health insurance for their family. While the couple still have none, they had signed up their children for the program in 1998 -- just before their son Nathan had his first severe asthma attack.

"If I had not had that insurance, I would not have taken him to the emergency room and he probably would have died," Beverly Chappell said. "The program has value. Nobody should have to evaluate when it is an emergency and when it is not because they are afraid of getting a bill."

© 2007 The Washington Post Company