Ronald Reagan noted that “Governments tend not to solve problems, only to rearrange them.” He could have described the State Children’s Health Insurance Program (SCHIP). Created in 1997 in the wake of the collapse of the Clinton health plan, SCHIP was supposed to be the down payment in providing government health care for all by first providing federal support to new state-run insurance programs for millions of children, who, we were told, did not have health insurance.
It took nearly 10 years to enroll the nearly 5 million children who are currently on SCHIP today. In the main, some of the children that were enrolled by states were simply shifted from Medicaid to the new program in order to benefit from a more generous federal subsidy. While SCHIP did provide many children with coverage that did not have access to it in the private sector, it also siphoned off lots of children who, as they moved out of Medicaid, might have otherwise gotten private insurance. Regardless, 10 years later, there are still 6 million children eligible for Medicaid that have not signed up and only 700,000 children left eligible for SCHIP but unenrolled. That is a classic example of rearranging a problem with more money, which is how Washington creates entitlements.
The federal government is already paying for Medicaid and SCHIP but obviously people don’t like the hassles or quality associated with it. So, rather than give both SCHIP- and Medicaid-eligible families the cash and the choice of signing up for private health insurance, Democrats want to increase SCHIP spending by $50 billion to cover families with incomes up to $83,000 a year. In his movie “Sicko,” Michael Moore toasts countries like France, Canada and Britain where Pinot-drinking yuppies are drowning in taxes to pay for “free” health care. According the Heritage Foundation, that means a percentage of American families will be eligible for an entitlement and pay the Alternative Minimum Tax. Life does imitate art.
SCHIP’s record in rearranging the problem of health-care coverage rather than expanding opportunity suggests that Congress should seek a different course. It wants to create a government-run health system on the backs of children with higher taxes. Instead, it should expand tax breaks for health savings accounts and better insurance choices that promote portability and encourage prevention and disease management.
Unfortunately, as far as health care is concerned, it would appear many in Congress would rather pay to have us join Michael Moore’s medical mystery tour to Cuba than to continue to be part of the Reagan Revolution.