The veto, Bush's fourth, was delivered without the fanfare that accompanied his rejection of stem-cell legislation. It was attacked by Democrats and Republicans, including Utah Sen. Orrin Hatch who, in 1997, helped craft legislation to create the popular Children's Health Insurance Program (CHIP).

So why did he do it?

Call it the first salvo in what is shaping up to a bigger - and politically, higher-stakes - battle over plans for reducing America's swelling ranks of uninsured, say advocates for children and low-income families. Meanwhile, the fate of CHIP, which provides health insurance to 6 million poor children, hangs in the balance.

"It's unfortunate. The CHIP bill is caught up in the partisan debate, a rhetorical debate, really, about the future of health care in this country," said Karen Crompton, executive director of Voices for Utah Children. "It really should be considered for what it is, an opportunity to cover more kids."

CHIP was designed for working families who earn too much for Medicaid but can't afford health coverage through their employer, such as a family of four earning up to $41,300 a year.

Though largely funded by the federal government, the program is run and tailored by states.

Between 1997 and 2005, CHIP helped cut by a third the number of kids without health coverage, according to the Kaiser Foundation. But that number has started to creep up again.

The bipartisan bill that Bush vetoed on Wednesday called for expanding CHIP by $35 billion over the next five years. Some of that money would go to rising health care costs. It also would extend coverage to 10 million more children.

The funding source: a hike in the tobacco tax.

Bush supports a smaller, $5 billion, increase. But advocates say that's not enough to keep up with inflation.

And they argue that Bush has made misleading statements about Congress's plan, such as the claim that the bill would extend CHIP coverage to middle-income families making up to $80,000 annually.

For that to happen, states have to apply to the federal government for waivers, said Lincoln Nehring, an analyst at the Utah Health Policy Project. "Only one state, New York, has asked for a waiver, and the administration denied it."

Nehring acknowledged, however, there's a possibility that Bush will be replaced by a Democrat who is more sympathetic to these waivers.

Also rankling advocates is Bush's claim that the bill is a step toward "government-run health care for every American."

In Utah, as in most states, CHIP is administered by private insurers. Kids on CHIP go to the same hospitals as other patients.

That's why drug companies, children's hospitals and trade groups for private insurance companies - bulwarks of opposition to government-sponsored medicine - support the bill, Crompton said.

CHIP does mandate what, at a minimum, insurers must cover. And the legislation would have raised that floor, including beefing up dental coverage.

Utah already meets the proposed new dental standards, said state CHIP director Nate Checketts.

The bill also would have extended coverage to pregnant women for prenatal care. But it sought to generally bar states from using CHIP to cover adults.

Currently, there are no plans in Utah to expand CHIP. There are 28,000 kids now enrolled, leaving vacant 17,000 slots - roughly the same number of children estimated to be eligible.

On average, children spend one year on the program, though some families are repeat customers, state Health Department data show.

If Congress fails to strike a compromise with Bush, some states could run out of funding in November.

Utah has enough reserves to last through next April, said Checketts, who is optimistic, that "the federal government will fix this problem by then. They won't leave states hanging."

kstewart@sltrib.com