The Battle over SCHIP (New Eng Jour Med)

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The Battle over SCHIP

John K. Iglehart

Reauthorization of the State Children's Health Insurance Program (SCHIP), which was considered a routine matter until recently because of the program's success in expanding coverage to children of the working poor, has become embroiled in a larger struggle over ideologies that divide the political parties. The immediate battle to reauthorize SCHIP, for which the legal mandate expires on September 30, will resume this fall as Democrats, who command the House and Senate by slender margins, seek to stand up to President Bush, who has said he would veto the SCHIP bills approved by the two chambers because they authorize too much spending and go "too far in federalizing health care."

In the last days before Congress broke for its summer respite, the Senate defied Bush's threatened veto and underscored the bipartisan popularity of SCHIP by reauthorizing the program for 5 years on a vote of 68 to 31. House Democrats approved a more expansive version by a vote of 225 to 204, but only 5 Republicans supported it. Because the House-approved bill would also repeal an impending reduction in Medicare payments to physicians, broaden prevention benefits to Medicare beneficiaries, and increase support for selected hospitals (as well as eliminate the higher Medicare payments to private plans, as compared with fee for service), it attracted the support of the American Medical Association and allied physician organizations, as well as the formidable elderly lobby (AARP).

This support adds muscle to the efforts of Democrats to overcome the administration's opposition but also complicates the process.

SCHIP was created in 1997 as a bipartisan effort to provide insurance coverage for children living in families with too much income to qualify for Medicaid but not enough to afford private insurance (see line graph).1 An estimated 91% of children who are insured by SCHIP come from families with incomes below 200% of the federal poverty level, or $41,300 for a family of four in 2007. Before the enactment of SCHIP, only 11 states covered children in families with incomes of 185% of the poverty level or higher. By 2006, 42 states covered children with family incomes of 200% of the poverty level, including 7 states (in which the cost of living is particularly high) that set income thresholds for SCHIP eligibility at 300% of the poverty level.

In recent letters that underscored the strong state support for SCHIP, 43 governors urged Bush and congressional leaders to come together on behalf of reauthorization of the program before its expiration date.

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Source Information

Mr. Iglehart is a national correspondent for the Journal.

An interview with Professor Sara Rosenbaum, Chair of the Department of Health Policy at the George Washington University School of Public Health and Health Services, can be heard at www.nejm.org.

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