It has already made headlines--a $750 million appropriation meant to ease state SCHIP funding shortfalls is at risk because Congress put the money into a war spending bill that President Bush has vowed to veto. But there is more controversy to come for SCHIP (the State Children's Health Insurance Program) because the program, beloved of state governors and reviled as an opening wedge to socialized medicine by its critics, is due to expire on September 30.

That has produced a rash of bills in the House and Senate, most of them proposing to expand the popular program, and a lot of congressional hearings have been held or are scheduled. Meanwhile, the Bush administration is expressing strong opposition to any SCHIP expansion and has proposed instead to give families tax deductions to buy private health insurance.

Whether all of this will produce a compromise both sides can live with remains to be seen, but here are some of the issues involved:

• According to the U.S. Government Accountability Office (GAO), SCHIP enrollment increased rapidly during the program's earliest years, but has stabilized over the past several years.
• As of fiscal 2005, the latest year for which data are available, SCHIP covered approximately 6 million enrollees, including about 639,000 adults;
• State SCHIP programs reflect the flexibility federal law allows in structuring approaches to health care coverage. As of July 2006, 18 states had opted for a separate SCHIP child health program, 11 states had expanded their existing Medicaid programs to include more children, and 21 states had gone for a program that included both expanded Medicaid and a separate child health program.
•  Forty-one states cover children whose family incomes are at 200 percent of the federal poverty level or higher; seven of those states insure children whose family incomes are 300 percent or higher of the federal poverty level.
• Thirty-nine states require families to contribute to the cost of their children's SCHIP coverage, through premiums or co-payments.
• As of  February 2007, SCHIP identified 14 states that had received waivers from the Department of Health and Human Services allowing them to cover adults in their SCHIP programs; covered adults include caretaker relatives of Medicaid and SCHIP children, pregnant women, and childless adults.

Unlike Medicaid, SCHIP payments are capped, at levels depending on states' populations of eligible children, overall fiscal circumstances, and health care needs. SCHIP spending was initially low but now threatens to exceed available funding; some states consistently spend more than their federal contribution.

SCHIP is more popular than Medicaid with state governments because the federal government contributes a larger proportion of revenues, even though the total may be capped. State governors testifying at congressional hearings on reauthorization generally strongly support SCHIP.

With the Bush administration insisting on "refocusing the SCHIP program on low-income uninsured children" and congressional Democrats vowing to triple spending on the program by adding $50 billion, for a total of $75 billion over the next five years, the GAO cautions that "SCHIP reauthorization occurs in the context of debate on broader national health care reform and competing budgetary priorities, highlighting the tension between the desire to provide affordable health insurance to uninsured individuals, including low-income children, and recognition of the growing strain of health care coverage on state and federal budgets."

A GAO report, "Children's Health Insurance: State Experiences in Implementing SCHIP and Considerations for Reauthorization," is available online at www.gao.gov.

To view all SCHIP-related bills that have been introduced in this session of the United States Congress, go to http://thomas.loc.gov and enter "SCHIP reauthorization."