February 4, 2009 / 6:15 PM / 10 years ago

Obama signs children's healthcare bill

WASHINGTON (Reuters) - President Barack Obama on Wednesday signed a law expanding a health program to include 3.5 million uninsured children, advancing an overhaul of the U.S. healthcare system despite the embarrassing withdrawal of his nominee to lead the initiative.

President Barack Obama is surrounded by members of Congress as he signs the $32.8 billion expansion of the State Children's Health Insurance Program, or SCHIP, at the White House in Washington February 4, 2009. The SCHIP program aims to help working families who cannot afford private health insurance but earn too much to qualify for Medicaid healthcare coverage for the poor. REUTERS/Kevin Lamarque

Obama signed the legislation at a White House ceremony just hours after the U.S. House of Representatives voted 290-135 for the $32.8 billion expansion of the State Children’s Health Insurance Program, or SCHIP, which was approved by the Senate last week.

“In a decent society, there are certain obligations that are not subject to trade-offs or negotiations — healthcare for our children is one of those obligations,” Obama said.

The bill was “a downpayment on my commitment to cover every single American,” he added.

President George W. Bush twice vetoed similar bills, arguing it would raise taxes and encourage businesses and families to drop private insurance and switch to the program.

The bill signed by Obama aims to increase the number of children covered by SCHIP to 11 million from the 7.4 million currently enrolled.

The expansion is being paid for by raising the federal tax on cigarettes to $1 per pack from the current 39 cent-per-pack tax. Taxes on cigars and other tobacco products will also rise.

The signing ceremony provided a lift for Obama a day after he acknowledged mistakes in his handling of the nomination of Tom Daschle, a former Senate majority leader, to lead a broad overhaul of the $2.3 trillion U.S. healthcare industry.

Daschle withdrew his name from consideration as secretary of health and human services because of income tax problems.

Obama pledged in his campaign to expand healthcare coverage to an estimated 46 million uninsured Americans and to control medical costs. Healthcare advocates said the SCHIP bill would help him meet that goal.

“We see this as an important small downpayment in our quest to insure everybody in the United States,” Dennis Rivera, who heads the Service Employees International Union’s healthcare division, said in an interview.

Others said the bill would help achieve another important healthcare goal — discouraging smoking.

“By using a tax on tobacco, we are not only keeping kids healthier now, but also protecting their long-term health by discouraging smoking — a habit that causes deadly, costly and largely preventable diseases,” said Bill Novelli, chief executive of the AARP, an advocacy group for people over 50.

The SCHIP program is designed to help working families who cannot afford private health insurance but earn too much to qualify for Medicaid healthcare coverage for the poor.

President Barack Obama signs the $32.8 billion expansion of the State Children's Health Insurance Program, or SCHIP, at the White House in Washington February 4, 2009. REUTERS/Kevin Lamarque

Republicans had criticized provisions in the bill that allowed states like New Jersey and New York to provide coverage for higher-income families, some earning as much as $88,000.

They also criticized a provision backed by Democrats that ended a ban on legal immigrants enrolling in the program until they had lived in the United States for at least five years.

Republicans had argued that lawmakers could have achieved their goal of providing healthcare for more low-income children for less money. Despite those concerns, 40 House Republicans joined the Democratic majority in backing the legislation.

Additional reporting by David Alexander; Editing by David Storey

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