S-CHIP and Adult Coverage

The Elmira Star-Gazette reprints a Kuhl press release on S-CHIP.  It begins by touting the same USA Today poll as his blog post yesterday, then it makes the following claim about adult coverage in S-CHIP:

Currently there are more than 500,000 low-income children eligible for the program but not covered. Meanwhile, some 700,000 adults currently receive SCHIP benefits, including 87 percent of the enrollees in Minnesota and 66 percent of the beneficiaries in Wisconsin, according to the Congressional Research Service.
I couldn't find the Congressional Research Service report Kuhl cites, but the Kaiser Family Foundation's S-CHIP page has a report on Family Coverage that contains the same numbers.  The states Kuhl listed do have a high percentage of adult enrollment, because S-CHIP allows states to spend S-CHIP dollars on adults (mainly parents and pregnant moms) if they've already covered children under Medicaid.  Here's why:

In 2000, based on research showing the benefits for children of parent coverage, federal SCHIP waiver guidelines were issued permitting family coverage under certain conditions. In 2001, the Bush Administration released a broader waiver initiative, called the Health Insurance Flexibility and Accountability (HIFA) initiative, which encouraged waivers that used Medicaid and SCHIP funds to cover uninsured adults [...]
So, the coverage of adults was increased by the Bush administration, which now uses the waiver they issued as a basis for vetoing S-CHIP.   Strange, to say the least.

The reason that 500,000 children don't have coverage while some states are covering adults is because of the state/federal partnership on Medicaid.  States choose how much they spend on Medicaid in general, and S-CHIP in particular, and some states are far more generous than others.  This fact sheet from the Kaiser Foundation shows the variations across states.   There are a dozen states, most of them big states in the Southwest, where over 20% of the eligible children lack coverage. 

Finally, it's worth a peek at another Kaiser report on the basic problem which sparked the S-CHIP changes: the rising cost of health care, which has led to more uninsured families:

[T]he analysis shows that 48 percent of the increase in uninsured children from 2005 to 2006 was among families with incomes between 200% and 399% of the federal poverty level (roughly $40,000 to $80,000 for a family of four in 2006). Among kids, the share with employer-sponsored insurance declined by 1.2 percentage points, but there was no change in the share with Medicaid or SCHIP coverage to offset the employer decline since most children in this income group are not eligible for public coverage under current rules.
This is why states like New York want to raise eligibility requirements for S-CHIP.  The working poor and lower-middle-class can't afford health insurance, and their employers aren't providing it.