January 02, 2005
Hutchison on CHIP

Senator Kay Bailey Hutchison doesn't attack Governor Perry in her op-ed piece on restoring CHIP funds. She doesn't even mention him. She didn't have to. Look at this quote:

CHIP requires cooperation between the state and federal government. In 2005, for example, for every dollar the state puts into CHIP, the federal government will provide $2.65 in matching funds. (This program is particularly beneficial to state health systems, because the match is greater than Medicaid. For every state Medicaid dollar, the federal government supplies $1.56.)

I'm concerned that, despite the best efforts of our congressional delegation, Texas has not maximized its use of CHIP to support our state health care system. Since 2000, Texas has turned back about $700 million in unused federal funds to the U.S. Treasury, and those funds are now being used by other states, to help their working families pay for health insurance. In the recently ended fiscal year, the Congressional Research Service estimates Texas turned back more than $50 million in unused federal funds.

This money should be used to assist our county hospitals and the property taxpayers who fund them. Dr. Ray Perryman, an economist, has concluded that whenever Texas fails to take full advantage of Medicaid and CHIP, the state's economy is weakened. For every state dollar removed from these plans, he notes, local taxes must rise by 51 cents, insurance premiums on those with coverage must rise by about $1.33, and retail sales decline by almost two dollars. Perryman suggests the state treasury is also an ultimate loser, because the decreased economic activity causes a drop in state tax revenue.

As a matter of simple fiscal conservatism, I hope Texas will, in the future, take full advantage of available federal matching funds to bolster our state health care system, and relieve increasing pressure on taxpayers who fund county hospitals. CHIP, given the available federal match, makes sense for our children's health and economic sense for our taxpayers.

So she's saying that the loss of federal matching funds that resulted when CHIP was cut in the 78th Legislative session was like a tax increase on all Texans. Anyone else think we're seeing a primary campaign theme being taken out for a test drive?

UPDATE: Greg suggests what the Democratic response to KBH should be.

Posted by Charles Kuffner on January 02, 2005 to Election 2006 | TrackBack

I learned the other day that the 78th Lege did the same thing with drug treatment funds for parolees, which I mentioned in this post, and am searching for more detail. The feds apparently denied Texas drug treatment money because we didn't spend the minimum state matching funds necessary to draw it down. It's not so much a tax increase as just callously poor management -- they're still mulcting the same amount, we just get fewer services for the money.

Hey, happy third anniversary, by the way. Great accomplishment. Keep plugging.

And happy new year to you and yours, while I'm at it. Best,

Posted by: Scott on January 2, 2005 12:51 PM