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.