Why is the Children’s Health Insurance Program Facing Uncertainty?


Why is the Children’s Health Insurance Program Facing Uncertainty?

Blog Post

By No Labels
12/8/2017

Why is the Children’s Health Insurance Program Facing Uncertainty?

The Children’s Health Insurance Program, which provides low-cost insurance to kids in all 50 states, is one of the more popular programs to come out of Washington in the last 20 years. Yet the program is currently in jeopardy because Congress has not provided funding for it to continue.

The situation has caused some states to create contingency plans, warning – sometimes very publicly – that children could lose coverage. Late-night host Jimmy Kimmel even weighed in.

As you follow the debate over CHIP funding, here’s what you need to know.

CHIP impacts almost 9 million children

CHIP helps children whose families earn too much money to be covered by state Medicaid programs but not enough money to purchase private insurance. In 2016, the program covered roughly 8.9 million American children, according to government statistics.

Reinforcing the importance of CHIP, a report by the Center for Children and Families at the Georgetown University Health Policy Institute concluded that, “Marketplace plans would cost families more, provide fewer benefits and offer less stability than the CHIP program.”

There’s no serious opposition to CHIP

CHIP started in 1997 as a bipartisan initiative, sponsored by the late Sen. Edward Kennedy, a Massachusetts Democrat, and Sen. Orrin Hatch, a Utah Republican. CHIP has generally enjoyed bipartisan support in Congress, with very few lawmakers opposed to it.

Polls over the years generally show that the program has broad public support. For example, a Kaiser Health Tracking Poll in September of this year showed that 75 percent said it was important for Congress to reauthorize CHIP funding.

CHIP funding does spark some debate in Congress

The federal government allocates roughly $14 billion in CHIP matching funds to the states each year, The New York Times reported. However, the program’s authorization ran out in September. Since then, states have been covering the costs via other means and waiting for Congress to provide long-term funding

Congress has been arguing, not over the program’s funding levels but over how to pay for it, with lawmakers often split on partisan lines. For example, a House bill to reauthorize funding that made it to the floor earlier this month would have paid for it by raising premiums on wealthy Medicare recipients, using some Affordable Care Act funding and other initiatives that Democrats rejected. The bill passed on the strength of Republican support but has not been acted on in the Senate.

A stopgap bill to keep the federal government directed funding to states that needed it most. But so far, none of these efforts have yielded a long-term solution.

States are already complaining that time is running out

The common wisdom is that CHIP will receive its funding. As Hatch said recently, “We’re going to get CHIP through. There’s no question about that.”

But that has not stopped some states from sounding a warning that children will go uncovered if funding is not authorized. Colorado, for example, sent letters to CHIP families suggesting that they begin to look at other options for insurance.

While the fiscal situation is different in every state, data collected by the Kaiser Family Foundation in November suggests that three quarters of the states will run out of funding for CHIP by March.

Jimmy Kimmel took up the cause

CHIP advocates got a boost this week when Jimmy Kimmel, with his baby son Billy in tow, made an appeal for CHIP funding on his late night talk show. The Washington Post fact checked him and not everything he said earned their approval. But with his show drawing north of 2 million viewers, there’s no doubt his argument was heard.

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