Lawmakers agree to include children's health insurance funding in Iraq war bill

More than a dozen states whose children's health insurance plans are running out of money got welcome news from Washington as lawmakers moved toward providing $650 million in emergency funding.

Over initial objections from the White House, the money was included in a war spending package totaling some $120 billion that lawmakers hope will win President Bush's signature by week's end.

"It should be a very good compromise," Rep. David Scott, D-Ga., said Wednesday. "Yes, let's take care of the troops ... but certainly we should be able to respond to the health care of our children. Without this, children will go without their health care."

The State Children's Health Insurance Program _ intended to provide health coverage for children of the working poor _ is funded with a combination of federal and state dollars, with most participants also paying premiums. Federal funding shortfalls this year had left states like Georgia and Iowa in a lurch as demand had outstripped budgets.

Georgia, which was $131 million short, froze enrollment in its PeachCare plan in March, and lawmakers later agreed to provide $81 million in state Medicaid dollars to keep the program afloat. In Iowa, state officials warned that without more money they would have to drop 13,300 children from the state's Hawk-I plan.

Other states with budget gaps are Alaska, Illinois, Maine, Maryland, Massachusetts, Minnesota, Mississippi, Nebraska, New Jersey, North Carolina, Rhode Island and Wisconsin.

Democrats say the $650 million in emergency SCHIP funding will be partially offset by roughly $250 million in savings by keeping children off Medicaid rolls.

The insurance money is among a handful of domestic initiatives in the war spending bill. Bush objected to previous versions of the measure over Democratic-backed timelines for withdrawing troops from Iraq, but Democrats removed those provisions in the latest version.

The House and Senate are expected to vote on the package this week.

The emergency SCHIP funding is a temporary salve as Congress prepares to reauthorize the program for the long-term later this year.

SCHIP's current annual budget is $5.5 billion. Democrats have proposed nearly tripling that amount, setting up a budget battle with the White House, which has recommended a much smaller increase.

Congress created SCHIP in 1998 as a way to provide health insurance for children of working parents who earn too much to qualify for Medicaid but not enough to afford private coverage.