Congress still hasn’t renewed CHIP funding, 9 million children could soon lose health coverage

Three states and the District of Columbia are expected to run out of CHIP funds by next month.

(Credit: Getty Images)
(Credit: Getty Images)

It has been 51 days since Congress allowed the Children’s Health Insurance Program (CHIP) to expire. Since then, states have been grappling with the reality that nine million children may soon lose critical health care coverage.

While CHIP has historically received support from lawmakers on both sides of the aisle, this year, Congress has allowed disagreements over the Affordable Care Act (ACA) to take precedence over reauthorizing funding for the program. Things are now especially dire for Arizona, the District of Columbia, Minnesota, and North Carolina — all of which are expected to run out of CHIP funds by next month. Thirty-one states will likely exhaust their funding by March 2018.

“We’re in an unprecedented situation,” Joan Alker, executive director of Georgetown University’s Center for Children and Families, told ThinkProgress. Referring to Congress’ delay in funding the program, Alker said, “We’ve never seen anything like this happen before.”

Created in 1997, CHIP provides low-cost health care coverage to millions of children whose parents’ income exceeds Medicaid qualification levels, but only amount up to 300 percent of the federal poverty level. The program, which also helps pregnant parents, is funded through a block grant that provides states with a set amount of dollars that they then match with their own funds. CHIP helped lower the rate of uninsured children from 14 percent in 1997 to 4.5 percent in 2015, providing much-needed coverage for routine check-ups, prescriptions, dental and vision care, emergency services, and other critical health care needs.

When federal funding for the program runs out, the law requires the Centers for Medicare and Medicaid Services (CMS) to redistribute unused funds from previous years to states. Continuing coverage also depends on whether a state has a separate CHIP program or one that is an expansion of its Medicaid program. States that fall into the former category are permitted to shut down CHIP coverage if federal funding runs out and those in the latter category can continue that coverage through Medicaid at a lower federal rate.

“States have been walking a tight rope for a while,” Alker said, adding that many states have spent time and money on developing contingency plans to notify families and providers in the event that they are forced to shut down their programs.

In a statement emailed to ThinkProgress, the Minnesota Department of Human Services said that while it received redistributed CHIP funds for October and November, it does not expect to receive additional funds. The state, which has a combination program (both separate and expansion), can provide continuing coverage to children through Medicaid, but “there is no fallback coverage other than emergency care” for pregnant individuals once the redistributed CHIP funds are exhausted, the statement said.

In the past couple of months, Texas, Florida, and Puerto Rico have been especially hard hit, as all states have had higher than expected costs due to recent hurricanes. The program covers 400,000 children in Texas, and the funds could dry up as early as January.

“Even if Congress does fund the re-authorization of CHIP later this year or into 2018, people will have been hurt here in Texas,” wrote Ken Janda, president and CEO of Community Health Choice, Inc., in a recent column for the Houston Chronicle. “Some people might get sicker or even die before they have a chance to enroll again, which is only made more complicated by the hurricane recovery, as families are displaced and documents are missing.”

Missouri, which has a combination program, is due to run out of funding by March 2018. Earlier this month, the mother of a St. Louis CHIP recipient suffering from a rare form of lung cancer wrote an op-ed urging Congress to renew funding, amid fears that her son, Roland, may lose vital health coverage.

“If Congress forces Missouri to drop Roland’s coverage, our family will be in an impossible situation. I don’t have the savings to pay for Roland’s care out of pocket. I don’t have family and friends — much less a bank — who will loan us tens of thousands of dollars for Roland’s treatment,” Myra Gregory wrote.

Congress has taken steps to reauthorize the program, but, so far, they’ve been caught in partisan crossfire over where the money should come from. Several weeks ago, the House voted along party lines to pass Republican legislation that would refinance the program and extend funding for five years. Democrats criticized the measure for paying for CHIP by cutting funding to programs treating opioid addiction, diabetes and heart disease, youth suicide, and other public health initiatives.

“These programs have traditionally been bipartisan. But, the bill before us extends these programs by taking billions of dollars away from the Affordable Care Act, and undermining Medicare,” said Rep. Frank Pallone, Jr. (D-NJ) on the House floor prior to the vote. “Democrats strongly support reauthorization of these programs — but we reject the way Republicans are paying for them.”

The Senate Finance Committee, last month, passed a bipartisan five-year reauthorization of the program, but did not specify how it intended on paying for the measure. A similar House bill, which has not advanced through committee, proposed funding CHIP by raising Medicare rates for senior citizens who earn more than $500,000 a year and by redirecting the ACA’s prevention fund.

“I hope that we can avoid a very negative outcome,” Alker said, adding that she is “cautiously optimistic” that Congress can set aside it’s difference to “do something good for kids’ health.”