WASHINGTON -(Dow Jones)- Setting the stage for a showdown with President George W. Bush, the Senate Thursday cleared legislation that would increase children's health insurance funding by $35 billion over five years and raise tobacco taxes to pay for the increase.
The vote was 67-29, with 18 Republicans breaking party ranks to back the bill.
Bush has promised to veto the bill, though Democrats are hoping the program's popularity will sway him.
"There is still time," Senate Finance Committee Chairman Max Baucus, D-Mont., said.
Companies that would be affected include R.J. Reynolds Tobacco Co., a wholly owned operating subsidiary of Reynolds American Inc. (RAI); Philip Morris USA, a subsidiary of Altria Group (MO); and Carolina Group (CG), which is a unit of Loews Corp. (LTR).
While Bush supported an expansion of the State Children's Health Insurance Program, or SCHIP, in 2004, he says the bill now headed to his desk goes too far and that he will veto it.
Democrats, who had wanted to spend an extra $50 billion, say they don't intend to accept anything less.
"I'm sick of compromising," Senate Majority Leader Harry Reid, D-Nev., told reporters Thursday afternoon.
At least for now, it appears clear that the bill will not become law.
While enough Republicans in the Senate back the bill to override Bush's promised veto, the House's 265-to-159 vote to pass the bill Tuesday fell 25 votes shy of the 290 votes needed to do so.
Republican leaders, ones who voted against Thursday's bill, are talking about compromise. Some are suggesting simply funding the program at current levels. Others, including Senate Majority Whip Trent Lott, R-Miss., have said a $15 billion increase could work.
Republicans are also suggesting looking elsewhere besides a tobacco tax to offset the program's cost, though they have said that cutting Medicare payment subsidies to insurers is not one of the alternatives.
Democratic leaders haven't said what they intend to do next, though compromise appears unlikely.
House Speaker Nancy Pelosi, D-Calif., has said she intends to "haunt" Bush with the bill. She's talking about expanding the bill, possibly to the $50 billion originally proposed by the House.
Some in the Senate are suggesting that Congress simply keep sending the same $ 35 billion plan to the White House until federal elections next November.
Fight Over Children's Insurance Splits GOP
One of the more vocal advocates of pestering Bush until he signs the bill into law is fellow Republican Sen. Charles Grassley of Iowa.
Grassley and other Republicans backing the bill argue that while $35 billion may be more than they would spend, the $5 billion Bush is proposing is far too little. The Congressional Budget Office estimates that roughly 1.4 million fewer children and pregnant women would be covered by SCHIP under Bush's plan.
"Increasing the numbers of uninsured children is clearly not the goal here," Grassley said.
But conservative Republicans argue that the SCHIP expansion would allow adults to be covered, would include children from "rich" families, and would encourage families already covered by private health insurance to drop such coverage in favor of the government subsidized plan.
"We're not taking care of children we are selling their freedom away," Sen. Jim DeMint, R-S.C., said. He and other Republicans warned that the bill is a step to nationalized health care.
"You can't split the difference between freedom and socialism," DeMint said.
Grassley said calling the bill "nationalized health care" was dead wrong.
"To those of you who make such outlandish accusations, I say, go shout 'fire' somewhere else," Grassley said.
The vast majority of the program's benefits go to lower-income children; the bill makes it harder for states to use SCHIP to cover adults; and while the enhanced program will attract some children currently covered by private insurance, it would add coverage to 3 million new children, Grassley said.
Baucus said Republicans and the White House are raising their objections in a mistaken effort to try to tie the debate to the broader issue of health care reform. Baucus said they would also like to block the bill to then claim it was the "dysfunction" of the new Democratic majority that prevented it from becoming law.
Both GOP and Democratic leaders claim political advantage in the fight.
GOP leaders say that voters will reward them for killing an effort to expand the size of government and raise taxes.
Democratic leaders say voters are more interested in getting health insurance to kids and won't mind the tax increase which could push more Americans to quit smoking.
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The vote was 67-29, with 18 Republicans breaking party ranks to back the bill.
Bush has promised to veto the bill, though Democrats are hoping the program's popularity will sway him.
"There is still time," Senate Finance Committee Chairman Max Baucus, D-Mont., said.
Companies that would be affected include R.J. Reynolds Tobacco Co., a wholly owned operating subsidiary of Reynolds American Inc. (RAI); Philip Morris USA, a subsidiary of Altria Group (MO); and Carolina Group (CG), which is a unit of Loews Corp. (LTR).
While Bush supported an expansion of the State Children's Health Insurance Program, or SCHIP, in 2004, he says the bill now headed to his desk goes too far and that he will veto it.
Democrats, who had wanted to spend an extra $50 billion, say they don't intend to accept anything less.
"I'm sick of compromising," Senate Majority Leader Harry Reid, D-Nev., told reporters Thursday afternoon.
At least for now, it appears clear that the bill will not become law.
While enough Republicans in the Senate back the bill to override Bush's promised veto, the House's 265-to-159 vote to pass the bill Tuesday fell 25 votes shy of the 290 votes needed to do so.
Republican leaders, ones who voted against Thursday's bill, are talking about compromise. Some are suggesting simply funding the program at current levels. Others, including Senate Majority Whip Trent Lott, R-Miss., have said a $15 billion increase could work.
Republicans are also suggesting looking elsewhere besides a tobacco tax to offset the program's cost, though they have said that cutting Medicare payment subsidies to insurers is not one of the alternatives.
Democratic leaders haven't said what they intend to do next, though compromise appears unlikely.
House Speaker Nancy Pelosi, D-Calif., has said she intends to "haunt" Bush with the bill. She's talking about expanding the bill, possibly to the $50 billion originally proposed by the House.
Some in the Senate are suggesting that Congress simply keep sending the same $ 35 billion plan to the White House until federal elections next November.
Fight Over Children's Insurance Splits GOP
One of the more vocal advocates of pestering Bush until he signs the bill into law is fellow Republican Sen. Charles Grassley of Iowa.
Grassley and other Republicans backing the bill argue that while $35 billion may be more than they would spend, the $5 billion Bush is proposing is far too little. The Congressional Budget Office estimates that roughly 1.4 million fewer children and pregnant women would be covered by SCHIP under Bush's plan.
"Increasing the numbers of uninsured children is clearly not the goal here," Grassley said.
But conservative Republicans argue that the SCHIP expansion would allow adults to be covered, would include children from "rich" families, and would encourage families already covered by private health insurance to drop such coverage in favor of the government subsidized plan.
"We're not taking care of children we are selling their freedom away," Sen. Jim DeMint, R-S.C., said. He and other Republicans warned that the bill is a step to nationalized health care.
"You can't split the difference between freedom and socialism," DeMint said.
Grassley said calling the bill "nationalized health care" was dead wrong.
"To those of you who make such outlandish accusations, I say, go shout 'fire' somewhere else," Grassley said.
The vast majority of the program's benefits go to lower-income children; the bill makes it harder for states to use SCHIP to cover adults; and while the enhanced program will attract some children currently covered by private insurance, it would add coverage to 3 million new children, Grassley said.
Baucus said Republicans and the White House are raising their objections in a mistaken effort to try to tie the debate to the broader issue of health care reform. Baucus said they would also like to block the bill to then claim it was the "dysfunction" of the new Democratic majority that prevented it from becoming law.
Both GOP and Democratic leaders claim political advantage in the fight.
GOP leaders say that voters will reward them for killing an effort to expand the size of government and raise taxes.
Democratic leaders say voters are more interested in getting health insurance to kids and won't mind the tax increase which could push more Americans to quit smoking.
Discuss Add this link to... Bury
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