Cuts could happen even if Congress offers help

ATLANTA - Whether or not Congress rides to the rescue of PeachCare, it seems almost certain that the Georgia health insurance program for low-income children will emerge from this year's funding dustup leaner.


The top Republicans in the state House and the Senate are floating plans that would slash children from the PeachCare rolls, increase premiums and make dental and vision coverage a more expensive add-on. They argue that even if the federal government moves to fill the current shortfall, PeachCare needs to scale back if it's going to survive for the long haul.

House Speaker Glenn Richardson said the funding fight "has given us a good clean opportunity to give the program a fresh look."

"This is about the long-term viability of PeachCare for those kids that need it," he said.

Children's advocates argue that Georgia's program, which serves 273,000 children, has long been a model for other states and that state GOP leaders are using the funding crisis as an excuse to pursue long-sought cuts.

"Our leaders are telling Congress that this is a valuable program that they need to preserve, but then at home they're showing they are willing to slash this same valuable program," said Lauren Waits, the policy director at the Atlanta-based Voices for Georgia's Children.

Georgia is staring down a $131 million shortfall in federal funds for PeachCare, and state officials said they will stop enrolling new children in the program March 11.

Democratic leaders in Congress have said they will seek $750 million for the state Children's Health Insurance Programs - or SCHIP - as part of the Iraq war supplemental budget. But when - and if - the money will be approved is anyone's guess.

A task force convened by Lt. Gov. Casey Cagle recommended an increase in premiums for PeachCare participants based on income level. Emergency room visits would be subject to a new $25 co-pay. Children younger than 6 currently exempted from premiums would have to pay, under the task force recommendation.

Mr. Richardson has introduced a bill that would lower the income threshold for PeachCare to 200 percent of poverty, a move that would eliminate about 21,000 children from the rolls.

Mr. Richardson also said he wants to tighten eligibility by checking participants' immigration status and verifying income levels of applicants.

President Bush has proposed only $5 billion for SCHIP as part of his budget for the coming fiscal year. That's less than half of the $11 billion to $13 billion that would be needed to fund the state programs at current levels.

Alan Essig, the executive director of the nonpartisan Georgia Budget and Policy Institute, said it is premature to make changes to PeachCare until Congress retools it.

He also argued it would be a mistake to remove children from the rolls at a time when employer-sponsored health insurance coverage in Georgia is on the decline.