Our View:: Kids’ health No. 1

A decade ago, a Congress controlled by Republicans adopted a bipartisan bill to extend health care coverage to children from households with too much money to qualify for Medicaid but not enough to buy private insurance. The president signed it.

This year, a Congress controlled by Democrats wants to reauthorize the State Children’s Health Insurance Program and expand it to children who remain uninsured. The president has vowed to veto a bipartisan bill that would do just that.

Instead, President Bush wants to continue the current spending of $5 billion a year, because he fears an expansion of the program would crowd out the private sector. He’s right, as far as he goes. The Congressional Budget Office notes that 34 percent of the children helped by the Senate bill are already covered by private plans.

The administration calls this troubling, but its preferred remedy of offering tax deductions that people could use to pay for their own insurance would deliver 77 percent of the benefits to people who are already insured, according to an analysis by MIT economist Jonathan Gruber.

If the idea is to help those who truly need it, the Senate bill is the better way to go. Plus, the administration’s complaint unintentionally raises a pertinent question: Why would people switch from private insurance to a public program? Answer: Private insurance is more expensive and may not offer the same range of services. Many plans include deductibles that low-income families struggle to pay.

To illustrate the effect of the rising cost of health insurance – an increase that easily outpaces the rise in wages – note that SCHIPS is projected to cover 7.4 million children by the end of this year. If government merely holds to the current funding levels, which the administration advocates, enrollment would drop to 3.7 million by 2017.

Halving the number of children who are covered would trigger other costs, such as poorer attendance for kids at school and parents at work. Plus it would exacerbate the crippling costs of emergency room care and charity care.

Economics aside, it’s morally troubling to deny health care to so many children.

The Senate bill calls for $35 billion for the next five years, which would be paid for with an increase in the tobacco tax. Included in the bill is a provision that is of particular interest to states such as Washington, which expanded Medicaid coverage before SCHIP was adopted. Washington state would like to shift some children from Medicaid to SCHIP, which has a favorable funding formula, but the government prohibits that. The bill would lift that ban, which would allow the state to enroll about 35,000 more children, according to U.S. Sen. Maria Cantwell.

The president’s ideological objection to the Senate bill hasn’t resonated within his own party because it doesn’t better accomplish the practical goal of SCHIP, which is to extend health care to children.