The State Children's Health Insurance Program looks like it will be a big, if not the big, domestic policy debate when Congress returns from its August recess. So we'll have more to say about it soon. For the moment, though, I wanted to point out one key fact. If you've been following this issue, then you know the basic fault lines. S-CHIP expires this year, so Congress must reauthorize it. Congressional Democrats, along with some Republican counterparts, want to make sure the program keeps insuring the people who it's already insuring -- which will reqiure spending more. And because the program has been remarkably successful at reducing the number of low-income children without insurance, they want to expand it so that it can cover even more of them. On the other side is President Bush, plus a different group of Republicans, who object to the expansions on principle. Among other things, they say, the program has already exceeded its "initial intent" by covering some children who are well above the poverty line. In so doing, they say, it's becoming a middle-class entitlement, displacing private insurance. As a result, Bush has promised to veto expansions if they come to his desk. What's more, as my colleague Ben Crair noted yesterday, he's also issued regulations under which the Secretary of Health and Human Services could restrict states' existing ability to expand coverage up the income ladder. Which brings me to my brief argument for the day. Listening to Bush and his supporters, you'd get the impression that S-CHIP is using taxpayer dollars to subsidize coverage for tons of well-off, middle-class couples who don't need the help.* The numbers, alas, tell a different story. As of 2006, more than 90 percent of the children receiving coverage under S-CHIP were in families at or below 200 percent of the poverty line. (See the first page of this Kaiser Family Foundation paper.) And while I haven't yet found hard numbers on where the other 10 percent are, my bet is that many of them are in New Jersey, the state that has stretched the income limits the most -- by allowing families making up to 350 percent of the poverty line to buy in. Why is that significant? Well, New Jersey has some of the most expensive health insurance in the country, not to mention a pretty high cost of living. So you can imagine why a family making three-and-a-half times the poverty line might actually need help getting health insurance. Indeed, that helps explain why New York state is now proposing to stretch its income limits even further. It, too, has notoriously expensive health insurance and a high cost of living. --Jonathan Cohn *For the record, I personally would have no problem with government insuring middle-class Americans -- and upper-class ones, too. I'm a fan of universal coverage, which means I think government-financed insurance should cover everybody. But that's another question.