The Census Bureau reports that the number of Americans without health insurance has risen to 44 million, about 11 million of them children. Insuring the uninsured has become a major issue in the contest for the Democratic presidential nomination, with Al Gore and Bill Bradley presenting dueling proposals – each centered on uninsured children.
Gore would expand the Children's Health Insurance Program, known as CHIP, and Medicaid. Bradley would pay the full insurance premium for children from families with incomes under $32,800 for a family of four, and provide subsidies on a sliding scale for children from families with incomes up to $49,200 for a family of four. Both proposals contain other provisions aimed at attracting the uninsured into the ranks of the insured.
Without minimizing the importance of health care for children, the Gore and Bradley proposals may be good politics, but both are questionable policy. Perhaps it is worth questioning why so many people overall, and so many children, are uninsured.
It isn't always because they can't afford insurance. Some 12 million – nearly three out of every 10 – are in families with annual incomes of more than $50,000. It isn't clear how many of that group are children.
Nor is it always because insurance isn't available to those who can't afford it. Just last month, President Clinton said most uninsured children are eligible for CHIP or Medicaid. Their parents just haven't enrolled them in either program. In fact, since CHIP started two years ago, the number of uninsured children has gone up.
The president said the government had expected five million children to enroll in CHIP by now, but only about a million are actually in the program. Further, many of those may simply have switched from some other type of insurance coverage – including private insurance. When CHIP began, the Congressional Budget Office estimated that about 40 percent of the children who enrolled would simply switch from some other type of coverage.
CHIP is now available for children from families with incomes below 200% of the poverty level. Gore wants to raise the limit to 250%, and to expand the program to let parents enroll, too, if their incomes are below some level set by each state. He also proposes letting parents without employer-provided health insurance buy into CHIP, saying families will be more likely to enroll their children if every family member can have coverage.
The federal government has already committed $20 billion over the next few years to cover uninsured children, mostly in the form of block grants to the states, which contribute another 25 percent. CHIP hasn't worked so far, but Gore thinks an expensive expansion will make it work.
Bradley's plan is not any more likely to bring additional children into the ranks of the uninsured than Gore's. At least, Bradley deserves credit for proposing to abolish Medicaid and let low-income families buy private insurance instead. Private insurance for a child can be obtained for $600 to $800 a year, but Medicaid costs far more. But Bradley proposes a $1,200 subsidy for each child from a poor family. This is done through refundable tax credits (you file a return and get the money even if you don't pay any income tax). The family gets the credit even if the child already is covered by employer-provided insurance. (For that matter, adults with employer-provided insurance get a credit, too, if their annual family income is less than $32,800.)
Although Bradley would require all children to have health insurance, he said he didn't propose any mechanism to enforce the requirement. Both candidates Gore and Bradley might consider a radically different, but eminently sensible approach for providing universal access to health care proposed by the National Center for Policy Analysis: let the federal government commit a fixed sum of money for private health insurance for every American. People who must buy their own insurance would receive a refundable tax credit dollar-for-dollar for premium costs up to a maximum amount.
Everyone would be able to buy a basic policy, but would have to use their own money if they wanted additional insurance. Those who choose not to buy private insurance would in effect pay higher taxes for being insured. The same fixed amount would go to state and local governments to be used as a safety net to fund health care for the indigent.
Simpler, less expensive, and everybody – including every child – would have access to health care.
——————————————————————————–
The National Center for Policy Analysis is a public policy research institute founded in 1983 and internationally known for its studies on public policy issues. The NCPA is headquartered in Dallas, Texas, with an office in Washington, D.C.