Maine Taxpayers Dodge a Bullet on SCHIP


Today, Maine taxpayers were shielded from a potential tax increase. The failure of U.S. House of Representatives to override George W. Bush’s veto of the expansion of SCHIP will prevent a subsequent increase in the Maine General Fund Budget.
MHPC researchers Tarren Bragdon and J. Scott Moody had estimated that the passage of the SCHIP bill would have resulted in a $25 million annual increase in Maine Medicaid costs. The SCHIP bill would have expanded resulting in more matching funds for the states. Those funds would have created an incentive for Maine Legislators to increase state spending in order to receive the new federal money.
Federal delegations need to recognize that they are doing a disservice to their home states by supporting fiscally irresponsible bills like SCHIP. Federal bills like SCHIP create incentives for state legislators to also behave in a fiscally irresponsible manner. It is in the best interest of taxpayers that these federal bills never get the chance to wreak havoc on state budgets.