Thursday, October 11, 2007


“Schip was created in 1997 to help insure children from low-income families, but it has since become a stealth vehicle to expand government control of health care. . . . House and Senate negotiators [have hashed] out a ‘compromise’ that would expand the program by about $35 billion over the next five years (plus a budget gimmick concealing at least $30 billion),” according to a Wall Street Journal editorial of September 24.

The President’s Saturday message was to explain the necessity of his veto of the State Children’s Health Insurance Program bill. Said he, “Unfortunately, 500,000 poor children who are eligible are not enrolled in the program. Several states including Massachusetts , Illinois , New Jersey , Michigan , Rhode Island , and New Mexico spend more SCHIIP money on adults than they do on children. And that is not the purpose of the program. (Federal funds are given as block grants to the states that are free to spend them as they wish.)

“I think the Children’s Health Insurance Program is another step to move toward universal coverage” of the type in Canada , Britain , and France , said Senator Max Baucus. “Everyone realizes that the goal of this legislation moves us a giant step further down the road to nationalizing health care.”

HillaryCare II? Hillary is reported to have told Speaker Denny Hastert that people cannot be trusted to make spending decisions so in her plan there is a “global budget.” Washington would dictate an absolute level of medical spending for the whole society.

President Bush in his Saturday morning radio address on October 6 stated that “one out of every two children who moved onto the government plan would drop private insurance.” Here lies the deep philosophical divide between the health-care insurance plan as originally designed and the plan now moving in the direction of central planning of universal coverage.

Congress’s SCHIP has gradually been moving away from children (defined in the bill as up to 25 years old) who are poor. Middle-income and wealthy children and even adults with no children can be covered where their income is up to $83,000.

Advocates of universal health-care seem not overly concerned about costs as health-care becomes unaffordable with states’ piling on requirements. In New Jersey , insurers must accept all applications (known as “guaranteed issue”). There, it costs a family as much to be insured with a $500 deductible and a 20% co-payment (the insurer pays 80%) as it does to lease a Ferrari, according to Dr. David Gratzer in his book, “The Cure, How Capitalism Can Save American Health Care” (New York: Encounter Books, 2006, $25.95). States mandate requirements. Maine requires that all insurance policies must provide for pastoral counseling. According to the Council for Affordable Health Insurance, in 2004 there were 1,823 benefits mandated by states, including chiropodists (3), marriage therapists (4), massage therapists (4), social workers (28). Some states mandate specific services, e.g., second surgical opinions (ll) and birthing centers with midwives (6).

“Suppose America ’s working poor were having terrible difficulty affording clothes. It would hardly make sense to pass a law compelling them to shop only at Neiman Marcus or Saks Fifth Avenue . Suppose car prices were rising fast. Who would propose outlawing the sale of used cars?” David Frum asks.

The Democrat rebuttal to the President was given by Majority Leader Steny Hoyer, who asserted that SCHILD “will not cost a penny.” Not so, says the President. The plan will run out of money in five years, and Congress will then either have to raise taxes or drop people from the plan.

The fact is that the additional funding needed at the outset of this amendment is planned to come from a huge increase in the cigarette tax. This is a tax on the working poor, who tend to smoke more than upper-income people. An additional source of funding in the House version would come from a reduction in the government subsidy to the rural elderly.

The Republican position is that the Congressional plan is an incremental step toward a socialist government-run health-care for every American. Government-run health-care would deprive Americans of choice and competition that come from the private market, the President said in his address. It would result in rationing, inefficiency, and long waiting lines. It would replace the doctor-patient relationship with dependence on bureaucrats in Washington , D.C. It is the wrong direction for our country. “Ultimately our goal should be to move children who have no insurance to private coverage, not to move children who already have private coverage to government coverage,” he concluded.

by Natalie Sirkin
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