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A Better Way To Expand Children's Health Coverage

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The Tampa Tribune

Published: October 19, 2007

Expanding SCHIP is not the answer. There's a better way to extend health coverage to children.

The State Children's Health Insurance Program should be reauthorized, but it should remain focused on covering children in low-income families that earn no more than twice the federal poverty level (FPL), or $41,300 for a family of four.

A health care tax credit for families earning up to $61,950 for a family of four will extend and preserve coverage to more children than simply expanding SCHIP to the middle class. This approach also will let those families select coverage that suits them best, rather than limit their options to a government-sponsored program.

The tax credit approach has several advantages over making SCHIP coverage a middle-class entitlement. It will help 1.3 million uninsured children get the type of health insurance their parents think is best for them. Families would use the credit to shop for 'best available' coverage, purchasing it either through the workplace or on their own.

It will help another 9.2 million children keep the coverage they already have. Some 77 percent of the children in families earning two to three times FPL already have private health coverage. Estimates show a tax credit could help about 9.5 million families struggling with rising insurance costs keep the coverage - and the doctors - they already have.

The bill approved by Congress would make government health care available to families earning three times the FPL - that's up to $62,000 for a family of four. The lure of 'free' SCHIP coverage will reduce the number of children with private-sector insurance and increase Americans' dependency on government-chosen coverage.

The Heritage Foundation projects that about half of the millions of children made newly eligible for SCHIP under the proposal will drop off their private sector coverage and receive government health care.

The Heritage Foundation is a conservative think tank based in Washington, D.C.

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