NCPA - National Center for Policy Analysis


September 28, 2007

Most shocking about the recent vote on the State Children's Health Insurance Program (S-CHIP) is how many Republicans have surrendered or been accomplices in this latest expansion of government health care, says the Wall Street Journal.

Simply on the basis of fiscal responsibility, opposing S-CHIP is a no-brainer, says the Journal:

  • On paper, the bill expands S-CHIP by $35 billion over the next five years, to a total of $60 billion, well beyond the 20 percent expansion supported by the Bush Administration.
  • To fill this pot of federal dollars, the Democrats will raise the cigarette excise tax by 61 cents.

More broadly, S-CHIP is designed as a ratchet that jacks up the government's share of health care spending because the real Democratic game is to turn the program into a new middle class entitlement:

  • Earlier this year, Sen. Hillary Rodham Clinton (D-N.Y.) introduced Congressional legislation that would raise S-CHIP eligibility to 400 percent of the federal poverty level or $82,600 for a family of four.
  • That move would qualify no less than 71 percent of American children for public assistance.

This would also lead to the bizarre circumstance in which a family would be entitled to S-CHIP benefits while also paying the Alternative Minimum Tax that is supposed to capture "the rich," says the Journal.  According to a Heritage Foundation analysis, if S-CHIP is extended nationally to 400 percent, about 70,000 families would be rich enough to pay the AMT while also on S-CHIP.

Source: Editorial, "Schip for Everyone," Wall Street Journal, September 28, 2007.

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