House Democrats Pass Bill to Bolster Child Health Insurance

House Democrats pushed through legislation Wednesday to add 6 million lower-income children to a popular health insurance program while making deep cuts in federal payments to Medicare HMOs, defying a veto threat from President Bush.

On a 225-204, mostly party-line vote, the House passed the legislation, which would add $50 billion to the decade-old State Children's Health Insurance Program and roll back years of Republican-driven changes to Medicare.

The bill would slash federal payments to private insurance companies that cover elderly and disabled patients under Medicare and shift money to doctors and benefits for lower-income beneficiaries. The rest of the children's health increase would come from hefty increases in taxes on tobacco products.

In other congressional action, the House passed by a broad margin, 381-40, a $20 billion water projects bill Bush threatened to veto because of growing costs. Many House members have home-state projects funded in the bill, which includes drinking water and wastewater treatment plants and authorizes the Army Corps of Engineers to improve navigation, reduce flood and storm damage threats and restore environmental damage.

House Democrats decided to abandon efforts this week to use energy legislation to push for an increase in automobile fuel economy. Two amendments that would require a boost in required mileage for news automobiles were withdrawn by their sponsors. House Speaker Nancy Pelosi said she supported the drive for more efficient cars but wanted the issue deferred to promote passage of the overall energy bill.

The children's insurance legislation sparked a bitterly partisan health care battle on the eve of Congress' monthlong summer recess, complete with parliamentary fireworks by angry Republicans. The back-and-forth engulfed a broadly supported program to insure working poor kids in a larger argument over whether the government or the private sector should provide health insurance to the nation's most vulnerable populations.

In the Senate, a more limited, $35 billion expansion of the children's health care program without broader Medicare changes appeared headed for a bipartisan endorsement by the end of the week, despite another threatened veto. Bush has proposed spending half as much on the program — scheduled to expire Sept. 30 — over the next five years.

In a veto threat of the House bill issued Wednesday, the administration said the legislation "clearly favors government-run health care over private health insurance," and spends far too much.

Pelosi, D-Calif., who has made children's issues a signature focus of her tenure, said the measure would "meet our moral obligation to our children."

The decade-old SCHIP program is designed to subsidize the cost of insurance for children whose families earn too much to participate in Medicaid, but not enough to afford private health insurance. Through federal waivers, however, the program has expanded in many states to include middle-income children and adults, prompting Republicans to argue that it has morphed into a backdoor way to extend government-provided health care to an ever-increasing population of Americans.

"This is not just about helping low-income children. This bill today seems to be spending government funds to lure middle class, upper middle class, even wealthy, perhaps, families, to opt out of private health coverage and go to government health coverage," said Rep. Jim McCrery of Louisiana, the top Republican on the House Ways and Means Committee.

Democrats, betting that opposing the measure — which would insure a total of 11 million under SCHIP — would be a political loser for Republicans, painted the GOP opposition as mean-spirited and stingy.

"The bottom line is, where were you when this government, as big as it is, wanted to protect (11 million) kids in health insurance?" said Rep. Charles Rangel, D-N.Y., the Ways and Means chairman. "Come November (2008), people will be asking questions: ... Did you let this program expire? And were you there when the children called on you?"

Beyond health care for children, though, the measure reflected dueling Democratic and Republican health care priorities, especially on how to cover the nation's elderly, a potent voting bloc. Democrats have long worked to bolster government-provided coverage for seniors under Medicare, while Republicans have favored giving private companies incentives to insure them.

To help pay for the SCHIP increase, Democrats dipped into federal payments to Medicare HMOs, which they argue drive up premiums for the elderly in traditional Medicare by inflating the cost of care. Officials estimate the government pays an average of 12 percent more to these private plans than it does for traditional coverage.

Republicans said Democrats would live to regret the Medicare cut, which GOP strategists say will prompt angry seniors to exact a steep political price on the majority party.

"Don't use children as your shield," said Rep. Mike Rogers, R-Mich. "This is the single largest cut to Medicare in the program's history."

Just five Republicans crossed party lines to support the measure, while 10 Democrats — including conservatives whose districts have high concentrations of seniors participating in Medicare HMOs — broke with their leaders to oppose it.

As the acrimonious debate unfolded in the House, the more modest Senate expansion of the program survived challenges from the right and left. Republican efforts to scale back the plan and a Democratic bid to increase it both failed.

The Senate rejected 61-35, a $35 billion alternative offered by GOP leaders that would have limited eligibility for the program to those it was originally designed to cover — people at 200 percent of poverty, or $41,300 for a family of four.

Also rejected were GOP attempts to freeze SCHIP at its current $25 billion level and to cut federal payments for middle-income children and childless adults and limit future coverage for those populations.

Senators also turned back, 60-36, an attempt by Democratic Sen. John Kerry, D-Mass., to increase SCHIP to the House's $75 billion level. Kerry had proposed paying for the boost by rolling back Bush's tax cuts for people making $1 million a year.

Many Republicans have lined up with Democrats in defiance of Bush to back the more limited SCHIP expansion in the Senate, but it's unclear whether enough will break with their president to hand the majority a veto-proof margin.

Since the program's inception, the Democratic and Republican administrations, including Bush's, have issued waivers to states that allowed them to extend coverage to children with higher incomes and to adults. Nineteen states have done so, allowing families earning as much as $82,600 to be covered.

The bipartisan bill would gradually move adults who don't have children out of SCHIP, giving states the option of covering them through Medicaid. The government also would lower payments for parents' coverage and be barred from issuing new waivers allowing states to cover parents. But states would still have the option of providing coverage to pregnant women through SCHIP.

It would be financed through a 61-cent-a-pack tax increase on cigarettes. The House-passed bill includes a 45-cent increase.