Clock is ticking for Congress to act on CHIP funding
Despite its popularity, the Children’s Health Insurance Program could get caught up in the ongoing partisan bickering that’s consumed Capitol Hill.
CHIP, which covers 8.4 million lowand moderate-income children, must be reauthorized by Sept. 30 or federal funding for the program will cease. The Medicaid and CHIP Access Commission projected that 1.2 million children would become uninsured if the funding ends, because their families would not be able to afford premiums or cost-sharing under private insurance. Since CHIP started in 1997, the uninsured rate for children has plummeted from 13.9% to 4.5% in 2015.
States are in a bind, too. Four states, including Arizona and California, will spend all their federal dollars by December, while 27 more will run out of money by next March. Many will have to send cancellation notices to CHIP beneficiaries, health plans and providers as soon as Dec. 1 if Congress doesn’t renew funding, Linda Nablo, chief deputy director of the Virginia Department of Medical Assistance Services, said during a Senate Finance Committee hearing last week.
“The states have held off making changes to their programs because they didn’t want to alarm beneficiaries or cause disruption for health plans and providers,” Anne Schwartz, executive director of the Medicaid and CHIP Payment and Access Commission, told the senators. “But the clock is very close to having run out.”
Republican and Democratic senators agreed during the hearing that they need to extend CHIP funding, but there was little or no discussion on how
“While some policy changes are certainly in order for the program . . . there may not be time to give full and fair consideration to CHIP reforms prior to the expiration of federal funding.”
Sen. Orrin Hatch (R-Utah)
to resolve thorny disagreements about details of the program or how long to extend federal funding, which is expected to hit $17.4 billion in fiscal 2018.
Democrats, backed by MACPAC recommendations, want to continue enhanced federal CHIP contributions to the states authorized by the Affordable Care Act, which bumped up federal matching rates by 23 percentage points through September 2019. As a result of that increase, the federal government has picked up 88% to 100% of states’ costs for the program.
In addition, Democrats and MACPAC want Congress to extend through 2022 an ACA provision barring states from reducing CHIP eligibility below the levels in place before the ACA took effect.
But some Republicans want to end the enhanced federal match and the state maintenance-of-effort provisions.
“While some policy changes are certainly in order for the program . . . there may not be time to give full and fair consideration to CHIP reforms prior to the expiration of federal funding,” committee Chairman Orrin Hatch (R-Utah), who co-authored the original CHIP legislation with Democratic Sen. Ted Kennedy 20 years ago, said in a written opening statement.
That may prompt Republicans to push for a reauthorization lasting just a year or two, rather than the five years recommended by MACPAC and backed by insurance, provider and patient advocacy groups.
It’s unclear whether Senate and House leaders will try to move a standalone bill or package funding with other measures, such as provisions to stabilize the individual insurance market or extensions of various Medicare programs.
Packaging CHIP renewal with funding for the ACA’s cost-sharing reduction payments to insurers could help GOP leaders get the CSR funding past balky conservatives, who don’t want to vote for anything that stabilizes the ACA. On the other hand, combining the measures could jeopardize rapid approval of CHIP funding, which most Republicans want to see passed.
During last week’s hearing, Republican Sens. Charles Grassley of Iowa, Dean Heller of Nevada and Tim Scott of South Carolina strongly backed renewing CHIP funding, along with all the Democrats on the panel.
“No one wants to be accused of interfering with continuity of healthcare for kids,” said Joe Antos, a conservative health policy analyst at the American Enterprise Institute. Antos predicts CHIP funding will probably pass as a stand-alone bill.