This vote was on an amendment by John Kyl, R-Ariz., which would prohibit the provisions in the State Children’s Health Insurance Program (SCHIP) reauthorization bill from being implemented until the Congressional Budget Office (CBO) – the arm of Congress that reviews the budgetary impacts of bills – certifies that the bill would not reduce the number of people currently covered under private health insurance by more than 20 percent.
The amendment was offered to a bill that would reauthorize SCHIP and expand the program’s funding by about $35 billion over the life of the bill. To offset the cost of expansion, the bill would increase the federal tax on cigarettes by 61 cents, to $1 per pack. The SCHIP program – funded primarily through taxes on tobacco products -- helps low income families with children afford health insurance, and currently covers about 6 million kids.
Kyl said the CBO has already found that between 25 and 50 percent of the people who are currently eligible for coverage under SCHIP already have private health insurance. Kyl said the CBO also found that 100 percent of those who will be newly eligible for SCHIP coverage as a result of the underlying bill’s expansion of the SCHIP program also already have insurance.
“In other words, CBO says 100 percent of the newly eligible, the people we are adding to this program, already have insurance. Now why should the American taxpayer have to pay for people who already have insurance?” Kyl said. “Surely, in response to the argument of the other side that it is as efficient as we can get, we can be more efficient than 100 percent inefficient. My amendment says that when we get it down to only 20 percent inefficiency, then the program takes effect; in other words, when only 20 percent of the people we are paying for already have insurance.”
Max Baucus, D-Mont., said if Kyl’s amendment were adopted, it would doom the entire bill. “There is no way in the world that CBO can certify [that]. They cannot do it,” Baucus said. Baucus added that that how many people who are currently on private insurance plans might seek to switch to SCHIP coverage (sometimes called “crowd-out”) remains to be seen.
“There are many organizations trying to figure out what is the so-called crowd-out rate. They are all over the lot. It is almost impossible to tell what it is. That is the reason for the big range to which the Senator referred,” Baucus said.
By a vote of 37-62, the Senate defeated Kyl’s amendment. Every Democrat present voted against the amendment. Of Republicans present, 37 voted for the amendment, and 12 voted against it. The end result was that the measure went forward without language that would prohibit the SCHIP reauthorization bill from taking effect unless the CBO certified that it would not reduce the number of people covered under private health insurance by more than 20 percent.