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Wednesday, July 1, 1998

Guess Who Paved the Road to Socialized Medicine?

Republicans Helped Create the Largest Health-Care Entitlement in 30 Years

Nearly one year ago, Congress passed and President Clinton signed into law the largest expansion of government health care since 1965, when Medicaid and Medicare were created. This new federally funded program, titled “State Children’s Health Insurance Program” (SCHIP), gives states the authority to enlarge government health insurance programs for children, including medical services in public schools. Congress estimates SCHIP will cost taxpayers $48 billion over ten years.

How ironic. When the Democrats controlled Congress in 1993, the Clinton administration was unable to pass its national plan for socialized medicine. Yet with Republicans in charge of Congress, the administration was able to implement its backup plan. According to the Association of American Physicians and Surgeons (AAPS), previously secret documents from Hillary Rodham Clinton’s Health Care Task Force show that a “kids first” strategy which could be implemented through Medicaid was the backup option in case the larger plan failed. The AAPS is the doctor’s group that successfully sued the task force to make it release all its documents. The government was ordered to pay more than $285,000 to AAPS because of the White House and Justice Department’s cover-up of task-force information.

When you ask Republicans why they helped create a new government health-care program for children, they will say that it’s what the American people wanted. But that is not exactly honest. Republicans are quite aware that Americans don’t want socialized medicine—or any new entitlement program for that matter. Even public-opinion polls confirm that. In fact, a recent Harvard University survey found that while most Americans think that children have a right to health care, the majority believes that families are responsible for securing that right-not government. Only 20.6 percent of those polled would consider giving that responsibility to the federal government. (Respondents were asked, “Who, if anyone, do you think should be most responsible for paying to make sure that children get this right [to health care]?” Results were: parents, 52.4 percent; federal government, 20.6; state government, 9.1; employers, 7.5; local government, 2.7; charities, 0.3; and other answers, 7.4 percent.)

Really, Why Did They Do It?

So why did the Republicans help create the largest federally funded health-entitlement program since 1965? It seems the Republicans merely caved into the Democrats’ savvy political strategy, which went something like this: Let’s propose a new government program for children and fund it with cigarette taxes. Then, if Republicans oppose “KidCare” we’ll charge that they don’t care about children and that the only reason they oppose it is because the Republicans get large sums of money from the tobacco industry. This was a brilliant political strategy. Yet the consequences of SCHIP will affect many, if not all, Americans.

One of the greatest dangers of SCHIP is that it will reduce the number of privately insured children. That is because SCHIP creates incentives for families and employers to drop private health insurance and instead take government subsidies for health care. The Congressional Budget Office expects that half of the participants in the new program will be families that give up private insurance. “That’s what happened when Medicaid opened in 1987 to pregnant women and their children with incomes 250% of the poverty level,” Robert Goldberg of George Washington University writes. “Between 1988 and 1995, the percentage of children covered by private insurance fell to 64% from 72%. At the same time, the percentage of children covered by Medicaid climbed to 23.1% from 15.5%. Studies show that at least threefourths of the shift was the result of parents dropping private coverage for themselves and their children. This new program will have the same effect.”

Another concern is that SCHIP could eventually become mandatory for all children, regardless of family income or need. That is what happened to the elderly. Consider that initially Medicare was established to help only poor elderly people, while the better-off were told they could keep their private health insurance. However, after Medicare was passed in 1965, the federal government garnered enough muscle to force private insurers to drop the nonpoor elderly, leaving them no alternative but to join Medicare. Moreover, the federal government has made it mandatory to enroll in Medicare Part A (which pays for hospital care) if you receive Social Security benefits. Given government’s track record, it is quite likely it could force children to participate in SCHIP. It is only a matter of time before we start seeing state laws that say, “Your child must join SCHIP or he can’t attend public school.”

SCHIP is also likely to lead to higher health-care costs. Again, one need only look to Medicare to see how that would happen. Medicare was created with the purported goal to help reduce the elderly’s out-of-pocket health-care expenses. However, their medical costs have increased dramatically since 1965. Medicare grew much faster than ever anticipated, and consequently, the elderly are now forced to pay higher deductibles and copayments. In terms of absolute dollars, their outof-pocket expenses were reduced by only $9 during Medicare’s first five years, from $234 to $225 per capita between 1966 and 1971. Since then, Medicare out-of-pocket costs (copayment and deductible amounts) have grown to $757 per beneficiary in 1995—about $26 billion total. Additionally, seniors pay millions out of pocket for non-covered services, such as prescription drugs. Clearly, Medicare did not meet its stated goal. It is unlikely that SCHIP can do so either.

A Dangerous Alliance

The greatest danger of SCHIP lies in its expansion of government health care in public schools. More than 30 states across the country are already in some stage of implementing KidCare in their public schools. Currently, public schools can provide health services under a Medicaid program titled “Early, Periodic, Screening, Diagnosis and Treatment” (EPSDT): Medicaid pays for any service to treat or prevent medical problems, including family planning, unclothed physical examinations, immunizations, and psychological counseling. Among the providers covered are physicians, nurses, psychologists, social workers, and physical therapists. Since 1967, Medicaid has required states to offer EPSDT programs to all Medicaid-eligible children up to age 21. Then in 1989 Congress mandated that states increase the proportion of eligible children receiving those services from 30 percent to 80 percent by 1995. To reach more children, the states tamed to the public schools.

There is no doubt that increased EPSDT services will mean a loss of parental control. Some school districts provide screening services to all children, whether or not they are eligible for Medicaid. A report by the Center for the Study of Social Policy on how to create school-based Medicaid programs explicitly states that “School districts should not consider the EPSDT/Medicaid program if their philosophy is that it is the sole responsibility of parents to attend to the health care needs of children.”

Clearly, the program implies greater government control over children, coupled with the view of parents as potential child abusers. A case in point is a recent incident in Pennsylvania where a public-school physician gave genital exams to 59 sixth-grade girls without parental consent and over the strong objection of some of the girls. The physician claimed she was looking for sexually transmitted diseases and for signs of sexual abuse. The new children’s health-care program increases the likelihood that public schools will examine or treat children without parental consent.

Parents should also be concerned about the lack of privacy at school-based health centers. Once a program is established, children are subjected to intrusive psychological testing without parental consent. Schools can then share psychological information and records with private foundations and state agencies. With so many behavioral problems labeled as psychological disorders, one can only imagine the labels applied to some students. Also, the school-based Medicaid programs create per-verse economic incentives: the more children diagnosed with psychological disorders, the more money schools can obtain from Medicaid.

But the trouble with psychological examinations does not end with the child’s school days. The results, as subjective as they may be, are entered on the students’ permanent school records, which then can affect their career opportunities.

SCHIP will help expand school-based health centers. Consequently, we will see more psychological testing and group counseling in public schools across the country.

The Republicans won control of Congress by promising to reduce government. But once in charge, they got scolded for their attempts to cut the growth in Medicare spending. One would think they would have learned a good lesson from that experience: it is almost impossible to roll back entitlement programs once they’re created, especially health-care entitlements. Yet instead of learning that lesson, Republicans helped create the largest health-care entitlement in 30 years. Thus, it is fair to say that the Republican-led Congress paved the road to socialized medicine.