In an editorial released Friday, National Review’s editors highlight the many problems with the State Children’s Health Insurance Program, or SCHIP. That program ostensibly was created for low‐​income children. Congress is presently trying to expand the program to cover as many non‐​poor children — and even non‐​children — as they can get away with.


I agree with most of the editorial, though I worry about its conclusion:

If the Democrats agree to enact some free‐​market reforms, it might be worth supporting a modest expansion of S-CHIP. Otherwise, President Bush should make good on his veto threat.

I think one would have throw in some pretty hefty free‐​market reforms to offset the harm done by expanding SCHIP. Letting people purchase health insurance out‐​of‐​state wouldn’t be enough. The package would have to include weightier reforms, such as President Bush’s proposed standard deduction for health insurance or large health savings accounts.

I discuss the many problems with SCHIP in an upcoming Cato Institute Briefing Paper.