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Child healthcare aid pondered

WASHINGTON - President Bush and other critics of a $35 billion spending increase for children's health insurance say they'll support expanding coverage to families of four making as much as $62,000 a year, but they want to limit states' ability to go beyond that level.

About three dozen states ignore certain income when determining who can get government-subsidized health coverage. For example, many states exclude child support payments. Others deduct expenses for child care when determining who qualifies for the State Children's Health Insurance Program known as SCHIP.

Congress is considering the renewal of the SCHIP for an additional five years, but differences remain over whom the program should cover and how much money should be spent. The flexibility that states have in defining income is one of the differences that will probably need to be resolved for Democrats to override a promised veto from Bush.

At the White House yesterday, spokeswoman Dana Perino said Bush's negotiators have been meeting with Republican congressional leaders - but not Democrats - about the children's health insurance legislation.

"I think they offered, and I don't think the meeting was accepted," Perino said of the White House's overture to leaders of the Democratic majority. Asked if any meetings with Democrats were planned, she said: "I don't think they want to meet with us. I think that's the point. They haven't taken us up on the offer."

Perino repeated the White House's stance that the legislation must be shaped in such a way to cover the poorest children first. "This is not about the price tag, it's about the policy," she said.

So far, the "income disregards" issue has received little attention, but that started to change in last week's debate on the House floor.

"You leave it up to the states to say you can't have an income level over 300 percent [of poverty], but you can deduct $20,000 for a housing allowance or you can deduct $15,000 for shelter or whatever," said Representative Joe Barton, Republican of Texas. "So, what you've got here is the classic bait and switch."

Representative John Dingell, Democrat of Michigan, said that allowing states to exempt some income helps to ensure that low-income families don't have to resort to welfare to get healthcare for their children.

Another disagreement over the program's future is over the coverage of adults, even though the Bush administration approved most of the waivers that allowed adults into the SCHIP program. Now, the administration wants to remove those adults from the SCHIP rolls more quickly than called for in the bill that passed the House last week.

Under that measure, states would have to move an estimated 200,000 childless adults off SCHIP within one year. Also, by 2010, waivers covering about 500,000 parents would be paid from a separate fund. States that perform well on covering low-income children could continue covering parents through that fund, which would get a lower federal matching rate, Dingell said.

Last year, administration officials testified during congressional hearings that extending state insurance coverage to parents increased the likelihood their children would get health insurance, too. But Mike Leavitt, Health and Human Services secretary, now calls the coverage of parents an experiment that took resources away from poor children. About a dozen states received waivers to cover parents through the SCHIP.

"All adults should be moved off SCHIP when their state waivers come up for renewal or within one year, whichever comes sooner," said a policy statement issued by the White House last week.

The bill that passed the House Thursday would allow about 3.9 million more uninsured children into the program by 2012 - on top of the 6 million now enrolled. An additional 2 million children would leave private coverage by then and enroll in SCHIP, according to the Congressional Budget Office.

The bipartisan bill before Congress calls for a $35 billion increase, bringing total spending to $60 billion.

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