Don't expand state children's insurance program
By Paul Guppy
Congress is currently debating re-authorization of the 10-year-old State Children's Health Insurance Program. A straight re-authorization for a further five years would cost the treasury $25 billion, but some advocates in Congress want to expand the program's expense to $50 billion, and one proposal is as high as $70 billion.
Crowding out private coverage
Most Americans support a safety net program to help needy kids. But the state children's insurance program is not just for the poor. Some states cover middle-income families making up to $62,000 a year, or three times the poverty level. One proposal would raise that to $83,000. And it's not just for children.
Fourteen states include adults in the program. Wisconsin, for example, spends 75 percent of its children's health money on adults. Some advocates want to count people up to 25 years old as "children" under the program.
A larger state children's' program would crowd out private insurance. The Department of Health and Human Services estimates that an expanded program would cause 1.6 million people with private insurance to drop their coverage and enter the government program. After all, why buy something when Congress will let you get it from taxpayers for free?
Currently, most children already have health coverage through a private family plan, usually provided by their parents' employer. The entitlement expansion would push many people into a one-size-fits-all federal program.
Top-down government programs undermine consumer choice and the ability to shop for affordable coverage. A public program that aggressively seizes market share risks putting private insurers out of business. Lawmakers should target assistance to those who need it, not set up tax-subsidized programs that compete for business against their fellow citizens.
Government policies drive up the cost of health coverage for children
Instead of shrinking the private market, lawmakers should review their own policies that make it harder for families with children to gain access to affordable health coverage. Such as:
