Wednesday, February 04, 2009

Congress expands SCHIP, Kentucky loses

Gov. Steve Beshear has made a big deal out of signing up children for government health insurance and the U.S. House of Representatives just helped him waste our money even faster.

From the Cato Institute:
"SCHIP’s great expense stems from the fact that in many cases, it simply enrolls children who were already insured privately. Economists Jonathan Gruber and Kosali Simon estimate that out of every ten children added to the SCHIP rolls, six already had private coverage. Only in government is a program deemed to “work” when it covers four uninsured children for the price of ten."

If Gov. Beshear were really serious about putting Kentucky in position to grow when the economy recovers, he would consider encouraging Kentuckians to get off SCHIP rather than trying to get them on:
"One thing SCHIP does accomplish is to discourage work. SCHIP and similar programs create enormous disincentives to climb the economic ladder. A single mother of two earning minimum wage in New Mexico who increased her earnings by $30,000 would find no change in her net income: She would pay an additional $4,000 in taxes and lose $26,000 in SCHIP and other government benefits, according to data compiled by the Urban Institute for the federal government."

Read more here.