This vote was on an amendment by David Vitter, R-La., that would prohibit states from covering low-income families under the State Children’s Health Insurance Program (SCHIP) if those families have access to health coverage through their employer.

The SCHIP program – funded primarily through taxes on tobacco products -- helps low income families with children afford health insurance, and currently covers about 6 million kids.  The amendment was offered to a bill that would reauthorize SCHIP and expand the program’s funding by about $35 billion over the life of the bill.  To offset the cost of expansion, the bill would increase the federal tax on cigarettes by 61 cents, to $1 per pack. 

Vitter said he wants to encourage those who are eligible for SCHIP but have employer-sponsored health care available to them to stay with their private health coverage.  Vitter said this will make more room in the SCHIP program to cover families who don’t have the option of coverage through an employer. 

The program is intended to be a health insurance safety net for poor children.  But some Republicans have argued that people have begun quitting their jobs so that they can qualify for SCHIP coverage, and that expanding the program would just encourage more people to quit their jobs.  Democrats generally counter that simply because a private health insurance program exists does not make it better than the coverage a family could have under SCHIP.

“What we do not want to do … is create a mechanism to push people off good private insurance or to encourage them to drop good private insurance or to encourage employers to drop that coverage simply because we are reauthorizing and perhaps expanding SCHIP. No child and no family should be forced onto any Government health insurance program if they are currently insured otherwise through the private sector, through the employer, et cetera,” Vitter said, citing statistics showing that 40 to 50 percent of the children who will be newly eligible for SCHIP as a result of the underlying bill’s expansion will be “shifted out of private coverage into SCHIP.”

Max Baucus, D-Mont., criticized Vitter’s amendment for mandating that states deny coverage to children if their parents’ employer offers health insurance. 
“Why should we require States to prevent children’s health insurance coverage if by chance the child’s family is offered private health insurance? The private health insurance may be inferior to what the child would otherwise get in the program. The benefits might be much less. Who knows what doctors are available. Who knows?” Baucus asked. “That is not a fair choice.”

By a vote of 35-64, the Senate rejected the amendment.  All Democrats present voted against the amendment.  Of Republicans present, 35 voted for the amendment and 14 voted against it.  The end result was that the measure went forward without language that would have prohibited states from covering children under SCHIP if their parents are eligible for employer-sponsored health care.