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The Bush Administration’s New Target: Uninsured Kids

Fighting against SCHIP is Bush’s first salvo in the battle for major health care reform

BY Art Levine

The first battle in the war over universal health care has begun, with the Bush administration and its right-wing allies targeting bipartisan legislation to expand and reauthorize the under-funded State Children’s Health Insurance Program (SCHIP). They’re doing so with a slick campaign comprised of lies, distortions and sloganeering that derides the proposed bills as paving the way for socialized medicine.

This blitzkrieg against uninsured kids should serve as a wake-up call for Democrats seeking major health care reforms. If President Bush and his spokesmen can tell the American public that, say, we invaded Iraq to stop a potential nuclear attack by Saddam, what’s to prevent them from fabricating falsehoods about a well-regarded program that currently provides coverage each month to 4 million low-income children–or bills that aim to reach about half of the nine million still-uninsured kids?

Apparently nothing, but progressive groups have been relatively slow to fight back and build veto-proof support for the SCHIP legislation in an effective, well-coordinated way. In mid-July, the president vowed to veto bipartisan legislation worked on for six months in the Senate that would add $35 billion to the program, paid for by an increase in cigarette taxes. (The full Senate is scheduled to vote on the bill this week.) Finally, there’s now a growing grass-roots effort to support SCHIP, with broad-based progressive organizations such as Moveon.org joining longstanding advocates like Families USA. On July 23, Moveon.org sent out an email alert to its 3 million members: “We still don’t have enough votes to override Bush’s veto–and the Senate vote is just days away. Can you help win the biggest health care victory in decades?”

But progressives have done relatively little in a highly visible and timely way to puncture the lies of the administration or target vulnerable Republicans who haven’t backed the reform bills. Some Senate leaders, such as Senate Finance Committee Chairman Max Baucus (D-Mont), have done what they can to counter the distortions and Presidential veto threats, with Baucus telling the New York Times, “The president should stop playing politics and start working with Congress to help kids, through renewal of this program.”

But starting in late June, the Secretary of HHS, Michael Leavitt, joined by columnist Robert Novak and other attack dogs, began pushing claims that the proposed SCHIP expansion would be a giveaway to well-to-do kids and adults, plus become what Leavitt called a “Washington-run, government-owned plan.” Leavitt conveniently overlooked Bush’s flip-flop on the issue: Bush himself promised at the 2004 Republican convention to use the SCHIP program to expand coverage to millions of kids, and it was Bush’s HHS that had granted waivers that allowed states to extend SCHIP to low-income parents and adults. HHS also released a dubious study in June claiming that less than 700,000 uninsured children fall below 200 percent of the poverty line, making them eligible for SCHIP or Medicaid, compared to six million in the most reputable previous research. Novak added to the statistical sophistry by claiming, “An estimated 71 percent of all American children in families of four making as much as $82,000 a year would become eligible, with states also continuing present coverage of adults under SCHIP.”

That spin conjures up images of $80,000-a-year yuppies lounging in front of their high-definition TVs, drinking cocktails while their healthy children frolic in the backyard–all of them covered by SCHIP at your expense. Actually, the proposed Senate reform bill would lead to cutbacks in coverage for poor parents and childless adults (less than 10 percent of current recipients), and would overwhelmingly serve uninsured children whose families make no more than twice the poverty level of roughly $20,000 for a family of four, and often far less, according to the nonpartisan Congressional Budget Office.

In fact, the proposed expanded SCHIP program would primarily reach uninsured kids who are already eligible for either SCHIP or the even more restrictive Medicaid program. Indeed, currently nine out of ten of those now enrolled in SCHIP are in families that earn below 200 percent of the poverty line. SCHIP was established in 1997 to cover those low-income, uninsured kids who weren’t eligible for Medicaid but whose families typically earn up to twice the poverty level. (The administration concocted its $82,000 figure because New York State said it might cover children in families that are four times the poverty level, but the Senate bill cuts sharply the federal matching grant to any state that raise the eligibility above 300 percent of the poverty level after the law’s passed.) Moreover, the current program reimburses children and poor families for care delivered by private insurers and doctors (it’s not British-style medicine, God forbid). And the bipartisan Senate bill even has the backing of such health industry groups as America’s Health Insurance Plans (AHIP), the American Medical Association and the Pharmaceutical Research and Manufacturers of America (PhRMA). (The health insurance lobby, though, opposes the House bill because it would cut the excessive payments to the private Medicare Advantage plans offered as an alternative to regular Medicare.)

But you wouldn’t know any of that from listening to the baseless rhetoric of President Bush and his henchmen. Bush’s proposed $5 billion increase in funding to the program would still leave nearly 20 states without sufficient funds to cover all those now enrolled. Bush opposes major expanded funding for SCHIP because he’d like to link the program with his dead-in-the-water proposals to offer tax credits or deductions to help people pay for high-cost, often exclusionary private insurance on their own. So the president has conjured up assorted socialized medicine bogeymen that might result from adding the needed funding–whether it’s the $35 billion in the Senate Finance Committee version that passed on July 16 by a 17-4 margin, or the $50 billion House bill that would also rein in overpayments to private “Medicare Advantage” private insurance plans. Bush claims that Democratic efforts to protect the SCHIP program before it expires September 30 would “expand SCHIP far beyond its original intent” and be “empowering [federal] bureaucrats to make medical decisions.” No matter, as Sicko amply documents, that private-sector HMO bureaucrats are already making medical decisions that are literally killing people by denying care their insurance should provide. Or that 90 percent of the public said in a recent Georgetown University-sponsored poll that it wants Congress to help the states cover more uninsured kids. President Bush’s recent what-me-worry? answer in Cleveland for those kids and families without insurance is, after all, a blunt reminder of his real views: “”I mean, people have access to health care in America. After all, you just go to an emergency room.”

Yet despite facing a GOP attack machine that has traditionally swift-boated Democratic candidates and anti-war opponents, the sensible Democratic and Republican advocates for the SCHIP reform legislation still acted as if this right-wing-pandering administration would deal with this popular health program for low-income kids in a fair-minded and reasonable way. “They were focusing on getting bipartisan legislation,” explains Edwin Park, a senior fellow with the Center on Budget and Policy Priorities. “The hope initially was that this wouldn’t become a battleground for larger health care reform, but they [administration officials] are starting the fight early.”

Now, both the House and Senate proposed bills have provisions that could slow their passage through the entire Congress and reduce the chances for overcoming a presidential veto. Some Southern and rural legislators are wary of the steep 61-cent increase in the tobacco tax in the Senate bill, while the effort in the House to add funds for SCHIP by cutting the absurd overpayments to the Medicare Advantage plans and other waste is spurring strong health insurance industry opposition. Still, some legislators on both sides of the aisle are hopeful that the President won’t follow through on a promise to veto health insurance for kids and that some expanded SCHIP measure can be cobbled together that could gather enough support to overcome a veto.

Yet as Drew Altman, the CEO of the Kaiser Family Foundation told Reuters in a recent interview, the fight over SCHIP is a “really bad sign” for future health care reforms. Altman asked, “If they can’t agree in Washington on covering kids, how are they going to agree on a much more challenging health care reform?”

Art Levine, a contributing editor of The Washington Monthly, has written for Mother Jones, The American Prospect, The New Republic, The Atlantic, Slate.com, Salon.com and numerous other publications.

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