SCHIP Spending Battle Continues

Published May 31, 2016

The battle on Capitol Hill over how much to expand the State Children’s Health Insurance Program (SCHIP) hit a roadblock on November 13 when President George W. Bush vetoed the legislation for a second time, vowing not to sign any legislation expanding the scope of the program to the degree Democrats in Congress desire.

Democrats knew the legislation was facing a veto and that they didn’t have the power to override it, given the strong opposition from House Republicans.

The second incarnation of SCHIP to be sent to Bush was nearly identical to the first–the few significant changes included reducing the phase-out time for childless adults covered under the program from two years to one and measures aimed at ensuring the program covers the neediest children first.

Opponents of SCHIP expansion said those provisions were ineffective. The measure’s supporters–who would have needed at least 13 votes to override a Bush veto–won practically no converts in Congress.

“An optimist would see this as an opportunity to further educate the public about what is really going on about expanding the program to cover kids well into middle-income families,” said Grace-Marie Turner, president of the Galen Institute.

“States have a responsibility to be good stewards of public money,” Turner said. “This is the State Children’s Health Insurance Program, and states do have a responsibility to make sure that the children who most need help from this program continue to receive it.

“There are better ways to provide incentives for people to purchase the portable, private health insurance of their choice for themselves and their families, and we need to make that case,” Turner concluded.

Democratic Infighting

Democrats took heat from their most liberal members for even attempting to compromise with House Republicans and the executive branch.

The “TriCaucus”–the Congressional Black Caucus, Congressional Asian Pacific Caucus, and Congressional Hispanic Caucus–said provisions to verify SCHIP beneficiaries’ citizenship go too far, and the caucus may oppose any compromise legislation.

Rep. Carolyn Cheeks Kilpatrick (D-MI), chairwoman of the Congressional Black Caucus, told The New York Times for a November 15 story she was disappointed Democrats had been “negotiating with 15 or 20 House Republicans, not the 43 members of the Black Caucus.”

In addition, eight Democrat senators–Amy Klobuchar (MN), Frank R Lautenberg and Robert Menendez (NJ), Jeff Bingaman (NM), Jack Reed and Sheldon Whitehouse (RI), and Russ Feingold and Herb Kohl (WI)–said they will oppose any compromise legislation that does not allow their states to continue covering adults at taxpayers’ expense.

“Our states have taken the lead to provide health care to this specific population, and we do not want to inhibit their ability to continue providing this important coverage,” the senators wrote in a letter to House Speaker Nancy Pelosi (D-CA) and House Majority Leader Steny H. Hoyer (D-MD).

Warring Factions

Beltway insiders speculate SCHIP’s repeated introduction when its chances of passage are so slim has more to do with politics than children’s health care.

Liberal interest groups accelerated their advertising purchases in the districts of Republican congressmen seen as vulnerable in the 2008 election. Radio and television ads excoriating Republicans for authorizing military spending while opposing spending on health care for children multiplied.

Funded primarily by labor unions, the ads are intended both to help Democrats in the 2008 election and to pressure moderate Republicans to change their votes on the SCHIP legislation.

At press time a compromise was unlikely, with various factions “drawing the line” on what the bill must include. Pelosi demanded it cover 10 million children, ensuring the expansion will cost an additional $30 billion–a figure Bush said he will veto. Business interests oppose funding an entitlement through taxes on one specific sector of industry–even if that industry, tobacco, is a popular bogeyman on Capitol Hill.

House Republicans oppose expanding the program to cover children in middle-income families, especially if those children would otherwise be covered by private insurance.

While Congress continues to quarrel over how much to expand the program when they officially reauthorize it, SCHIP continues to run on a temporary basis: A second stopgap bill funded the program at its previous levels through December 14.

James P. Gelfand ([email protected]) is a health policy expert in Washington, DC.