Covering More Children

The administration balks at the expansion of a health-care program that works.

IN THE DECADE since its enactment, the State Children's Health Insurance Program has helped provide insurance coverage for millions of children whose families have modest incomes but earn too much to qualify for Medicaid. Now the Bush administration is picking an unnecessary, and unnecessarily ideological, argument over the program's reauthorization.

SCHIP has helped reduce the percentage of children who are uninsured even as the share of adults without insurance has grown. Among children in families with incomes between 100 and 200 percent of the poverty level -- the group for which SCHIP provided the greatest increase in eligibility for coverage -- the share of uninsured children fell from 22.5 percent in 1996 to less than 17 percent in 2005. Yet 9 million American children remain uninsured at some point during the year. Most of them, an estimated 6.1 million, are eligible for Medicaid (4.4 million children) or SCHIP (1.7 million) but simply are not enrolled.

Today the Senate Finance Committee is scheduled to take up a generally sensible proposal to reauthorize the program and spend $35 billion more over five years than the $27 billion a straight reauthorization would provide; the House is discussing a larger increase. The bipartisan Senate proposal, backed by Chairman Max Baucus (D-Mont.) and health-care subcommittee chairman John D. Rockefeller IV (D-W.Va.) and their Republican counterparts, Sens. Charles E. Grassley (Iowa) and Orrin G. Hatch (Utah), would be paid for by a 61 cents per pack increase in the tobacco tax, which would in itself bring health benefits. By 2012, the Senate plan would provide coverage for 4.1 million children who would otherwise be uninsured, 1.8 million of them eligible for Medicaid. Policymakers are right to focus on, and devote resources to, this poorest population.

President Bush has issued an early threat to veto the Senate measure. The fight is partly over money: The administration is proposing a paltry $4.8 billion increase over current costs, an amount that, according to the Congressional Budget Office, would not even allow the program to tread water. But the fight is also about the government's place in providing health care.

The administration wants to cap SCHIP eligibility at 200 percent of the poverty level -- $34,340 for a family of three. The Senate measure would permit coverage for children in families at up to 300 percent of the poverty level. The administration is right that as the government extends coverage up the income scale, more families will shift from private insurance to public. The CBO estimates that half of those newly eligible under the Senate measure would otherwise be covered by private insurance. But the poverty level is a national benchmark, while the cost of living, not to mention the cost of health insurance, varies widely from state to state. Consequently, setting a flat 200 percent level would leave many children without coverage. The administration's alternative -- retooling the tax code to make insurance more affordable -- is going nowhere fast in the Democratic Congress. Meantime, insurance costs are rising rapidly, and employers are dropping or scaling back coverage. The risk of leaving children uninsured strikes us as greater than the risk of shifting costs to the government.