Courtesy of Grace-Marie Turner and the Galen Institute:
Nina Owcharenko of Heritage argued that this is a huge expansion of coverage that will largely replace private health insurance for millions of middle-income children with a government-run structure.
Steve Entin of IRET won the award for turning around an analysis of this week’s legislation in record time, and summarized his new paper. Even with their huge price tags, the bills are still underfunded because of budget gimmicks. The bill crowds-out private insurance and “would shift the cost of the insurance from private wallets to the public purse.” This program for the poor is funded by a tobacco tax that disproportionately affects lower-income people. And it creates a new tax on health insurance, “an odd way to hold down the cost of insurance.”
Bob Helms of AEI echoed Rep. Shadegg’s statement, saying that the incredibly generous ($242 billion this year) hidden tax expenditures for job-based health insurance “take away the incentives for people to seek cost-effective insurance. We will not be able to have more affordable health insurance without addressing this fundamental issue.” He also said that the funding formulas for both SCHIP and Medicaid offer huge incentives for states to expand taxpayer-supported coverage. Under the provisions of this bill, states could put every child on SCHIP if they are willing to pay the matching rate.
Michael Tanner of Cato said “Let’s be clear. SCHIP is a welfare program. How far up the middle class do we want welfare to go?” He argued that the bills are fiscally irresponsible and would carry us “down the road to government-run health care. Make no mistake: government funding inevitably leads to government regulation, and health care will become a public utility.”
And Jim Frogue of the Center for Health Transformation said that we need a new slogan for the cigarette tax, a main funding source for SCHIP expansion: “Smoke for the Kids.” He complained that the net new cost of covering an additional uninsured child is far too high and is unnecessarily crowding out private coverage.
Don’t punish poor children. Poorer children who are not enrolled in SCHIP will be a much lower priority if the program is vastly expanded into the middle class. The Urban Institute says that there are 689,000 uninsured children who would be eligible for SCHIP at 200% of poverty but are not enrolled. Those children certainly should be the first focus of our efforts in reauthorization.