By Alex Wayne, CQ Staff
November 6, 2008 -- Democrats are expected to pass a large expansion of children's health insurance early next year, making good on a campaign promise dating to 2006.
Lobbyists from child advocacy groups have been meeting with the staff of key Democratic lawmakers and committees responsible for the State Children's Health Insurance Program (SCHIP) in recent weeks, urging them to pass an expansion of the program as one of their first acts of the new Congress.
House Speaker Nancy Pelosi appears poised to meet the demand; she told National Public Radio on Wednesday that an SCHIP expansion "will probably be one of the first bills we would put on President Obama's desk."
The legislation came to President Bush's desk twice, and he vetoed it both times.
Child advocates say it is critical to keep a new SCHIP bill separate from a much larger, comprehensive health care overhaul that is one of President-elect Barack Obama's top priorities.
"I think there's a growing understanding . . . that given the economy, you should do SCHIP quickly, and it actually builds momentum for broader reform and doesn't step on it," said Gordon Whitman, a spokesman for the PICO National Network, a coalition of churches and faith-based community organizations.
"We don't want people to get it confused with overall health reform," said Jim Kaufman, vice president of the National Association of Children's Hospitals.
When Democrats took control of Congress in 2006, they promised that a large SCHIP expansion would be a top priority. The program was created in 1997 to cover children from families that are low-income but not poor enough to qualify for Medicaid, the much larger health entitlement.
About 7.1 million people, mostly children, were enrolled in the program at some point in 2007, according to the Centers for Medicare and Medicaid Services. The government expects to spend about $6.1 billion on SCHIP in fiscal 2009.
House Democrats passed a bill in 2007 that would have expanded SCHIP spending by nearly $50 billion over five years, but the Senate did not consider the measure. Instead, the Senate passed a bipartisan bill (HR 976) that expanded SCHIP by $35 billion over five years, to about $60 billion. But Bush vetoed the measure, as well as a second, very similar bill (HR 3963) that Democrats had hoped would draw a veto-proof majority. It did not.
Child advocates think that the bill the new Congress will pass will be similar in policy to the Senate bill that Bush vetoed. But thanks to inflation, it will have to include greater spending to cover the same number of children—perhaps as much as $50 billion over five years.
"You're effectively doing the Senate bill with a couple of tweaks," said Bruce Lesley, president of First Focus, a child advocacy group.
That includes one significant and controversial tweak. In 1996, Congress passed a law (PL 104-193) that forbids legal immigrant women and children from enrolling in Medicaid or SCHIP for the first five years that they are in the country. Child advocates have long sought to lift that prohibition, and see their opportunity under Obama.
Democrats face a problem paying for the expansion. The bill that Bush vetoed was paid for with an increase in tobacco taxes, including a 61-cent increase in the cigarette tax to $1 per pack. But that same tax increase won't pay for the larger expansion that is now contemplated.
"I think it will probably be one of the bigger issues," Lesley said.
Democrats also face a deadline. New spending on SCHIP is authorized only through the end of March—after that, the program would have to run only on money in reserve, and many states would quickly face shortfalls in their programs.
"Given the looming March deadline, states are looking to Washington for guidance on how this program will be structured," said Dr. Jay E. Berkelhamer, chairman of the American Academy of Pediatrics' Subcommittee on Access. The pediatricians' group also is lobbying for a quick SCHIP expansion.