Special Interests Lining up Against Bush on Children's Health Insurance Bill

Groups representing most facets of the nation's health care system are lining up in support of a large spending increase for a popular children's insurance program, even as President Bush renewed his veto vow Tuesday.

The major lobbying groups for insurers, doctors and hospitals said they stand behind a proposal to more than double spending on the State Children's Health Insurance Program. To pay for the increased spending, supporters seek a 61 cent increase in the federal excise tax on cigarettes. Comparable tax increases would also be applied to other tobacco products.

The legislation, which still wasn't available to the public late Monday evening, was to come up for a vote in the House on Tuesday. It was expected to pass easily.

However, Bush repeatedly has promised to veto the bill. A White House statement issued shortly before the House debate was to open said the bill "goes too far toward federalizing health care" and offers help to families that do not need it.

The most critical test will be whether at least two-thirds of the House members support the bill — the number needed to override a veto. Most analysts believe the bill is not likely to get that many votes.

The health insurance program, known as SCHIP, provides coverage to about 6 million children and 600,000 adults. Supporters said the bill under consideration Tuesday in the House and Wednesday in the Senate would raise that enrollment number to about 10 million children.

Richard Umbdenstock, president and CEO of the American Hospital Association, said Monday that children without health insurance were 2 1/2 times more likely to go without care for an illness than were children with insurance. Also, uninsured children were four times as likely as insured children to seek treatment in an emergency room.

He said the legislation being considered this week would help ensure that minor illnesses didn't become major illnesses for many children.

Bush supports a smaller spending increase for SCHIP: $5 billion over five years. The bill before Congress calls for a $35 billion increase.

Bush said he opposes the bill because it would turn SCHIP into a program that covers wealthier families who already have private health insurance.

"Instead of expanding SCHIP beyond its original scope, we should return it to its original focus, and that is helping poor children, those who are most in need," Bush said last week.

Sens. Max Baucus, D-Mont., and Charles Grassley, R-Iowa, took issue with Bush's description of their legislation. They said the vast majority of children participating in SCHIP would still live in families whose incomes are below twice the federal poverty level — $34,340 for a family of three.

"This program is a low-income kids program. There's just no doubt," Baucus said.

Grassley said that about half of the spending increase being proposed is needed just to cover the program's existing population.

Grassley emphasized that the legislation would not change the law about who is allowed into the program. If eligibility limits were increased to the levels described by the president — $83,000 for a family of four — it would have to be done with the administration's approval. Such approval is unlikely to occur, given that the administration just rejected such a request from the state of New York, he said.

Republicans will argue that tobacco taxes fall hardest on the working poor, the very people SCHIP was designed to help. About a third of adults who live in poverty are smokers.

"Under this scheme, the poorest Americans will be burdened with even higher federal taxes so that wealthier families and businesses can shift the cost of their health care coverage to the American taxpayers," said Reps. Joe Barton, R-Texas and Nathan Deal, R-Ga, in a letter to colleagues.

Republicans will also argue that the legislation relies on "gimmicks" to appear more affordable. Specifically, the bill authorizes $14.25 billion during the first 6 months of 2012; then slashes the amount to $1.75 billion for the second 6 months of that year. It then assumes the lower spending level for the program's duration.

As a result, Congress will have to find more revenue to maintain coverage for all enrollees after 2012, or states will have to slash enrollment.