If the Bush administration sticks with its recently issued edict, it will be goodbye SCHIP for a large number of children across the country.

Coming off an unsuccessful bid to thwart a bipartisan congressional effort to expand the State Children’s Health Insurance Program, the administration informed states late last Friday that they would need to adhere to stricter rules or lose funding. The administration executed this surprise maneuver without first consulting governors or state health administrators and knowing full well that it would ignite a firestorm of protest.

All sides in this debate have agreed on the ultimate goal: covering children. That goal is undermined by the issuing of these draconian guidelines, which is the latest volley fired in the battle over the reauthorization of SCHIP, which is set to expire Sept. 30.

To recap: The U.S. Senate approved the spending of an additional $35 billion over the next five years. The House voted for $50 billion. The administration is calling for $5 billion, which wouldn’t even be enough to maintain current coverage. Plus, it wants Congress to move to a system where recipients are given a tax credit they can use to purchase health care from private insurers.

But there is no pending bill in Congress that would do that. It’s a goal worthy of debate, but it’s not going to happen before the program expires. The administration needs to regroup to fight another day. Continuing the fight with unrealistic rules imposed on the states will only hurt children. Continuing the fight by vetoing the bill that will emerge from Congress will only hurt children.

Under the new guidelines, states that have expanded coverage to families who earn more than 200 percent of the poverty level must prove that 95 percent of children under that threshold are covered. According to Martha Roherty, executive director of the National Association of State Medicaid Directors, that’s simply not possible because of families’ shifting financial circumstances and other complexities. That means that the 18 states that have expanded their income eligibility or are considering doing so would have their funds slashed. Washington state is one of them. The state estimates that 10,000 kids could be affected.

In addition, the new rules state that children covered by private insurance would have to wait an entire year before being enrolled in SCHIP. In Washington state, the wait is four months, with options to get enrolled sooner.

State Medicaid directors, who run SCHIP, are urging the feds to back off and are asking Congress to override the new rules with legislation. It’s become cliché to say, “It’s for the kids.” But this time, it really is.