Aarp Health Insurance

President Obama today signed into law an expansion of health insurance for children, keeping a promise he described during the campaign as a critical first step toward universal health coverage.

The signing came only hours after the House voted, 290-135, to continue and strengthen the State Children’s Health Insurance Program (SCHIP), giving Obama one of his first victories since taking office. The Senate passed the same bill, 66-32, on Jan. 29.

But the victory is bittersweet, as both votes broke mainly along party lines, in a repudiation of Obama’s desire for bipartisanship. The greatest sticking point was a provision allowing certain legal immigrants to enroll in SCHIP, which many Republican lawmakers oppose.

AARP praised the new law as a “historic” boost to children’s health. “Keeping all American children healthy is vital for the future of our country,” said AARP CEO Bill Novelli, who attended the signing at the White House. “Our leaders have shown the political will to make progress on health reform,” he added. “Today represents more of a start than a finish—we must keep pushing to fix the health care system that squeezes all Americans and their employers.”

The SCHIP program, which covers the children of people who can’t afford health insurance but are ineligible for Medicaid, was due to expire March 31. The new law is estimated to cover an additional 4 million children, bringing the number enrolled to about 11 million. It is expected to cost $33 billion over the next four-and-a-half years, and will be paid for primarily by a 61-cent-a-pack increase in the federal cigarette tax, for a total tax of $1 a pack.

President Bush had vetoed the legislation twice, arguing that it cost too much and would expand the program beyond the low-income children it was originally designed to reach.

The new provisions “will allow all American kids to get the care they need to stay healthy,” AARP Executive Vice President Nancy LeaMond said. “There can be no economic recovery without acknowledging—and fixing—the role of skyrocketing health care costs on working families. Too many families are being forced to choose between insurance premiums and mortgage payments, between immunizations and groceries.”

House Speaker Nancy Pelosi, D-Calif., noted that Bush had vetoed the bill because of the cost. “Forty days in Iraq equals over 10 million children in America insured for one year,” she said. “We certainly can afford to do that.”

Opponents of the legislation have also charged that while it may help some children now, it will saddle future generations with the cost because the government is operating at a deficit, as are most of the states. The head of the National Governors Association said last month that states face their worst fiscal challenge in 25 years, with the national recession potentially punching a $200 billion hole in state budgets over the next two years, according to Stateling.org, a website that tracks state governments.

“The kids of tomorrow are going to pay through the nose for the things we are doing today,” said Rep. Dan Burton, R-Calif.

But AARP Policy Director John Rother says that paying for care for children is less costly in the long run. “Children who don’t have health insurance and don’t get needed medical care are much more likely to become seriously ill, imposing additional costs on the health system and families,” he says. “Health care investments early in life have significant beneficial effects throughout the life course.”

Credit: Elaine S. Povich