Colorado business and health leaders have banned together to get health insurance for every child in Colorado and the country. President Bush is asking Congress to authorize $5 billion over the next five years for SCHIP (State Children’s Health Insurance Program), which is designed for the children of working class parents.
Congress says that amount is too low, and 10 times that amount ($50 billion) is needed to cover kids in every state.
The General Accounting Office says $14 billion would be required to fund SCHIP over the next 5 years if enrollment stays steady. Rep. Diana DeGette says it won’t stay steady, it will only go up. She is correct.
How much will it go up? Groups like the Independence Institute do have a point:
“It makes people eligible who earn quite a bit of money. If they’re making that much, they can afford to buy their own health coverage.”
Harvard economist David Cutler and MIT economist John Gruber find that for every additional $1 spent on Medicaid, private insurance spending contracts by 50¢ to 75¢. For SCHIP expansion, Gruber estimates the contraction is 60¢.
If people can get free insurance from the state, they drop their private coverage. Or employers stop offering private coverage as a fringe benefit. The result: a massive shift of the burden from the private sector to taxpayers – while making only minor dent in the percent of people uninsured.
Also of the 8 million uninsured children in this country, fully 70 percent already qualify for Medicaid or SCHIP – their parents have just not bothered to enroll them!
If 70 percent of kids that qualify for SCHIP are just not enrolled, expanding it to include people that make more money doesn’t make much sense quite yet. There will be a lot of people that can afford to buy health insurance for their children on their own, but will decide to start having the government buy it for them. Then they can finally afford to buy that new plasma TV.
In Colorado, SCHIP is called Children’s Health Plan Plus (CHP+). Governors, including Gov. Ritter, like SCHIP because the feds will pay $2 for every$1 the state pays. Premiums paid by the government run about $122 per month per child.
Here are the guidelines to qualify for CHP+ health insurance in Colorado:
MAXIMUM INCOME LEVELS*
FAMILY SIZE ANNUAL MONTHLY HOURLY
I $20,424 $1,702 $10
2 $27,384 $2,282 $13
3 $34,344 $2,862 $17
4 $41,304 $3,442 $20
• Certain expenses such as child care, medical costs, adult health insurance premiums child support and alimony payments may be deducted from a family’s gross income. Hence, families may make more money and still qualify for CHP+.
* Applicable April 1, 2007 through March 31, 2008
How do we get enrollment in the current SCHIP plans up? John Goodman proposed this idea:
Parents should show proof they have insured their children (by employer plan, Medicaid, direct purchases, etc) before claiming the $500 child tax credit (the tax code’s reward to the middle class for having children).
Now that the credit has climbed to $1,000 per child, the case is stronger than ever. Republican members of Congress who passed on our tit-for-tat idea will now have to explain why only they and Ebenezer Scrooge want to deny families both a tax credit and free health insurance.
That sounds like a better place to start.