New York State will sue the Bush administration unless the federal government grants the state a waiver to extend public health coverage to tens of thousands of more children who are not covered by Medicaid, Governor Spitzer said yesterday.

A lawsuit would be a last resort for the Spitzer administration, which is angling for Congress to step in and override newly imposed federal guidelines that have derailed the governor’s effort to expand the state’s health coverage program for children. Lawmakers are expected to pass a reauthorization of the State Children’s Health Insurance Program when they return from their summer recess in September.

In April, state lawmakers in Albany agreed to increase the income eligibility for the program, which uses federal and state funds to provide health care to children whose families earn too much money to qualify for Medicaid.

The income cutoff was raised to four times the federal poverty level, or $82,600 for a family of four, the highest level in the nation for such a program.

The Centers for Medicare & Medicaid Services, the federal agency that administers Medicaid, has indicated that it will deny New York permission to expand coverage to higher income families, releasing new guidelines earlier this month that effectively prevent New York and other states from raising income eligibility caps above 250% of the poverty level.

“If they do not grant us this waiver, if they continue to be obdurate, continue to throw poison after poison pill, continue to say to us, ‘Don’t worry about it, there’s an emergency room available for those kids … we will sue CMS,” Mr. Spitzer said at a press conference at his New York City headquarters in Manhattan.

He was joined by Rep. Charles Rangel, who drew a connection between the Bush administration’s efforts to rein in the expansion of public health care and other contentious issues involving the White House.

“With the war going the way it is, why would he select the children?” Mr. Rangel, a Democrat of Harlem, said. “With Gonzales leaving, with Scooter Libby being pardoned, with Rove going, why would the president look for the most vulnerable of Americans to say that he’s going to make it more difficult for them to have health care?”

The new rules require that states enroll at least 95% of children who are below 200% of the poverty level and eligible for Medicaid or Schip before they are allowed to enroll any children in families above 250% of the poverty level. New York falls short of that benchmark by 5 to 10 percentage points, a significant gap, and so cannot expand its coverage under the new guidelines.

Federal health officials said the new standards are intended to stop the “crowding out” of private coverage. They declined to comment on Mr. Spitzer’s threat of legal action.

“I would note that New York state submitted last Friday a response to our questions about their state plan amendment application,” a spokeswoman for the U.S. Department of Health and Human Services, Christina Pearson, said via e-mail. “CMS is evaluating and under the law has 60 days to reply back to the state.”

Mr. Spitzer said the new rules were illegal because they contradict provisions of the federal Schip law and because they were handed down without notice. He also said CMS was treating New York differently from other states that have sought permission to raise income eligibility levels.

The House and Senate earlier this month passed different versions of a plan to reauthorize and expand Schip. While the Senate version has bipartisan support, President Bush has vowed to veto either bill, saying both plans pose a threat to private insurers.

Mr. Spitzer has set a goal of covering the estimated 400,000 children in New York who are uninsured.

The overwhelming majority of those children were already eligible for state-subsidized health care before the Legislature raised the income threshold. The change extends subsidized health insurance to about 60,000 to 70,000 children who previously were not eligible.