‘They came to school freaking out’: CHIP parents wait anxiously for federal action

Meanwhile, states prep contingency plans in case Congress doesn't fund the Children's Health Insurance Program by the new year.

TC Bell sits with his two daughters Dagny, 8 and Emma, 4 before they get dressed for school, at their home in Denver. Bell's daughters are recipients of the Children's Health Insurance Program. (AP Photo/Tatiana Flowers)
TC Bell sits with his two daughters Dagny, 8 and Emma, 4 before they get dressed for school, at their home in Denver. Bell's daughters are recipients of the Children's Health Insurance Program. (AP Photo/Tatiana Flowers)

The family liaison at Goldrick Elementary School, Mary Grace, said families came to her office last week “freaking out.” A handful of parents showed her a letter from the state. It read: If Congress does not renew federal funding, Child Health Plan Plus will end on January 31, 2018.

Some students at Goldrick in Colorado receive health insurance through CHP+ or the state’s Children’s Health Insurance Program (CHIP). A majority of students at the Southwest Denver school qualify for free or reduced lunch; the children’s parents are of modest-income; and many families are Latinx. Parent’s whose children receive coverage through CHIP sought Mary Grace’s advice. “What are my options?” Mary Grace didn’t know what to say. Admittedly, she wasn’t all too familiar with the drama out of Washington, D.C.

Colorado is the first state to warn families that if the federal government doesn’t fund the health insurance program, state officials will have to shut down operations.

“My families are affected and I’m really concerned,” said Goldrick special education teacher Silvia Stantcheva. “And I feel like I can’t do much.”

Congress failed to reauthorize funding for CHIP September 30th, amid a partisan health care dispute. Nearly half of all states will exhaust federal funding before February 2018, according to the Medicaid and CHIP Payment and Access Commission. Colorado officials expect to exhaust all funds by January 31st.

Seventy-five thousand families in Colorado are at risk of losing health insurance due to congressional inaction. Nationwide, CHIP provides coverage to roughly nine million children. In 20 states, pregnant women also qualify for CHIP. The program covers modest-income families who are not eligible for Medicaid insurance.

The federal and state government jointly finance CHIP, but the federal government pays most of the share. Congressional members overwhelmingly agree that the federal government should continue to finance the program, which helped bring the children’s uninsured rate to a historic low of 4.5 percent. But members do not agree on how to finance the program. The House voted along party lines in early November to pass a bill that funded CHIP for five years by charging higher premiums to wealthy seniors enrolled in the Medicare program and redirecting Affordable Care Act (ACA) public health funds. Democrats opposed the bill, arguing that Republicans are politicizing an otherwise nonpartisan program.

“My families are affected and I’m really concerned, and I feel like I can’t do much.”

Under a short-term spending measure released Monday, states would receive emergency funds to keep the state-by-state programs running until January. The House is expected to vote on the bill midweek.

Congressional dysfunction has state officials concerned about the future of the program. Three states and Washington D.C. are expected to run out of funds by the end of December, but these states — and a handful of others — have drawn up contingency plans should federal inaction continue. Minnesota was the first state to run out of federal funds but managed to bring in $3.6 million in emergency monies to keep the program running until the end of the year, according to the Los Angeles Times.

Arizona is another state that’s expected to drain federal monies in December. The program covers about 22,000 youngsters statewide. Once Arizona’s CHIP program KidsCare runs out of federal funds, state officials intend to reshuffle Medicaid funds to free up CHIP’s; this will extend operations for three more months and should have no effect on either programs’ enrollees. “We expect to implement our contingency plan at some point in December, but it is difficult to say on what exact day, since enrollment fluctuates,” said Heidi Capriotti, spokeswoman for the Arizona’s Medicaid program. Capriotti added that the state has already notified the federal health agency about its plan but permission was not required.

The Centers for Medicare and Medicaid Services (CMS), a division within the federal health department, has been providing “redistribution funds” to states since October to keep programs operating. CMS is able to use leftover CHIP funds from previous years to provide states’ relief. According to Politico, CMS has distributed $1.2 billion of its roughly $3 billion dollars in stopgap funds:

CMS gave Utah $13 million earlier this month to get through December said Kolbi Young, a spokesperson for the state’s health department.

The Utah Senator Orrin Hatch (R) authored CHIP 20 years ago, and recently came under scrutiny for supporting a costly tax bill that benefits the country’s most wealthy while simultaneously arguing Congress needs to be more mindful of entitlement spending.

“The reason CHIP’s having trouble is because we don’t have money anymore,” said Hatch Thursday on the Senate floor. A day later, Hatch helped lead the passage of a tax bill that would cost the federal government $1 trillion dollars. The bill, which passed at 2 a.m. Saturday, disproportionally benefits wealthier United States residents. While the Senate was able to pass a massive tax bill, it still hasn’t passed a CHIP bill. Now his home state stands to lose.

Utah officials have already posted a notice on the state’s CHIP website, alerting families to the possibility that the program will likely end January 31, 2018 if the federal government doesn’t commit to funds. If for any reason a family decides to enroll, pay their premium, or just access their account, they’ll see this alert. Like Colorado, Utah officials intend to send letters to affected families, but they do not have a definitive send date set. “We will provide adequate notice for families to find alternative coverage but ​​are hopeful that Congress will fund the program and make notification unnecessary,” said Tom Hudachko, a spokesperson for Utah’s health department.

If CHIP ends in Utah, state officials say many CHIP children will be eligible for coverage through the ACA marketplace. Although open enrollment ends on December 15 for Utah and most states where residents enroll for coverage on Healthcare.gov, CHIP families will still be able to enroll given the special circumstance.

If affected families don’t qualify for federal subsidies, coverage on the marketplace can be expensive. Premiums are particularly expensive this open enrollment because the president stopped paying insurers for one type of subsidy and Congress didn’t pass a bill in time to recommit these reimbursement funds.

“There is a chance that families may not be able to find something that is affordable,” said Gretchen Hammer, who directs Medicaid in Colorado, on NPR. “[Families] become financially responsible for the services that they’ve received.”