In September, Congress let expire the Children’s Health Insurance Program, a bipartisan-backed program that covers millions of low-income kids whose families earn too much to qualify for Medicaid. First created in 1997 under President Bill Clinton, CHIP provides health insurance for routine checkups, doctors’ appointments, and hospital care for nearly 9 million kids—as well as 370,000 pregnant mothers—across the United States.
The Medicaid and CHIP Payment and Access Commission (MACPAC), an independent agency tasked with making recommendations about Medicaid and CHIP, estimated in July that more than 1 million children would lose medical coverage if Congress failed to reauthorize CHIP—and that some 4 million CHIP enrollees were at risk in states where programs weren’t tied to Medicaid and where, as a result, the states were “not obligated to continue covering these children.”
Over the weekend, the debate over CHIP came to a boil after comments from Sen. Orrin Hatch, the Utah Republican who helped create the program two decades ago. When debating the GOP tax bill Thursday on the Senate floor, Hatch said that CHIP was in trouble “because we don’t have money anymore,” even though he believed it had done a “terrific job.” He then added he had a “rough time wanting to spend billions and billions and trillions of dollars to help people who won’t help themselves, won’t lift a finger and expect the federal government to do everything.”
The comments set off a social-media firestorm, especially after MSNBC host Joe Scarborough highlighted Hatch’s remarks in a since-deleted tweet. When critics insisted that Scarborough, a former GOP congressman, had taken Hatch’s remarks out of context, and that Hatch had been attacking other entitlement spending—and not CHIP itself—Scarborough responded on Twitter to say that Hatch had played “a cartoon version of a GOP senator” in his remarks.
The weekend mudslinging came weeks after the Washington Post reported that about a dozen states were gearing up to notify families that federal funds for the program could run out soon. On November 27, Colorado officials began sending out letters to CHIP recipients, including 75,000 children and about 800 pregnant women, saying the state’s program would end on January 31, 2018.
If Congress doesn’t come up with a solution before the Christmas holidays, says Tricia Brooks, senior fellow at Georgetown University’s Center on Children and Families, it’s “going to have a real chilling effect on our country’s historic progress in covering children.”
Why’d Congress let CHIP lapse in the first place?
It all comes down to political priorities. While Republican lawmakers rushed, unsuccessfully, to repeal the Affordable Care Act before September 30, they let the deadline to renew CHIP pass. And now that lawmakers have homed in on tax reform, the program’s future remains in limbo two months later.
CHIP is on the brink despite the fact that it’s popular across the political spectrum. Not only has it been credited with expanding access to health care for low-income families, research shows that it boosts educational outcomes and reduces hospitalization rates. (Thanks to Medicaid expansion and CHIP, the percentage of children under 19 who are uninsured has dropped from 14 percent in 1997 to 5 percent in 2016.) A September poll from the Kaiser Family Foundation noted that 75 percent of all respondents said it was “extremely” or “very important” for Congress to renew CHIP, including 62 percent of Republicans.
The problem is that Democratic and Republican lawmakers are at odds on how to pay for the program. The federal government spends about $14 billion a year on CHIP (it pays for about 88 percent, with states picking up the rest of the tab), and the bill that passed through the Senate Finance Committee in October proposed giving more than $100 billion to the program over five years. But the Senate bill didn’t lay out how the program would be paid for, the New York Times reported at the time.
A month later, the House of Representatives passed along party lines a similar bill to renew CHIP for five years and fund community health centers for two. House Democrats took issue with the bill, because it paid for CHIP by taking money from the Affordable Care Act Prevention and Public Health Fund, which pays for a range of programs, and raising Medicare premiums for wealthy seniors—something one Democratic representative rejected on the House floor and likened to robbing “Peter to save Paul.”
What’s the immediate impact of letting CHIP expire?
The program’s expiration hasn’t trickled down to families just yet, but parents are starting to get worried. “Even if they run out of money in February, it doesn’t actually mean they have enough money to last them until February. So we’re going to see some pressure here toward the end of the year if Congress doesn’t renew funding for CHIP,” Georgetown’s Brooks tells Mother Jones. “States are either going to come up with more money to provide coverage for these kids or they are going to have to take steps to close down or temporarily freeze their programs.”
Some states have already had to dip into their budgets or federal funds that have been carried over from previous years to maintain services. Projections from MACPAC and Georgetown suggest two states will run out of money this month; five more (and the District of Columbia) will run out by early January; and 22 more by March. Once July 2018 comes around, all states but Illinois and Wyoming would exhaust funds.
If the money runs dry, states will have to figure out which children are eligible for Medicaid or encourage families to seek out health insurance through Obamacare, according to a November letter from the Centers for Medicare & Medicaid Services (CMS), which administers CHIP. They’ll also have to decide whether to freeze or cap enrollment in their programs—or shut them down altogether.
Arizona’s past could offer a glimpse at the future. Back in 2010, in response to the recession, the state froze enrollment in its CHIP program at 46,000 kids, and by 2012, 13.2 percent of children in the state were uninsured. In 2012, Arizona opened an alternative program, and when that program ended in 2014, the results were devastating: 14,000 kids lost medical coverage, according to an analysis by Georgetown’s Center on Children and Families.
The federal government has already had to approve funding to keep some states’ programs afloat. So far, the Centers for Medicare & Medicaid Services has sent about $1.2 billion in reserve funds—roughly 40 percent of the federal government’s total allotted pot—to 16 states and the District of Columbia to keep programs running. “This availability of extra money has given Congress the impression that they have a cushion of time,” Brooks says, “but that cushion is getting pretty darn thin now.”
And projections for when states will run out of money can change. In Texas, where roughly 400,000 are enrolled, CHIP funds could run out quicker than anticipated—sometime in January—after the state suspended enrollment fees in areas affected by Hurricane Harvey. And Florida faces similar concerns as a result of Hurricane Irma.
Meanwhile, some states, including Arizona and West Virginia, are required by law to terminate their programs altogether if funding goes away. In West Virginia, one of 12 states that receive 100 percent in total funds from the federal government, a state board determined the program would end enrollment on February 28, 2018, if Congress fails to pass a spending measure.
All of this has state officials preparing for the worst. Linda Nablo, chief deputy director at Virginia’s Department of Medical Assistance Services, told WBUR the state would wait to send letters to CHIP enrollees on December 1 to tell them the program would end at the end of the month. “The last thing we want to do is scare parents and then turn right around and have to tell them, ‘Sorry, never mind. Congress has finally acted and your coverage is safe.’ It’s terrible,” Nablo said. “At this point, the draft letter says, ‘You may, your child may lose coverage, you know, we’ll let you know as soon as we know.'”
Can CHIP be saved this year?
Yes. Brooks points out both Republicans and Democrats agree on how long funding should last and how much the program should be funded but adds that they have prioritized the tax package over CHIP. “There’s this strong sense that Congress has every intent to get this done and doesn’t have to debate it anymore,” she says. “It’s just a matter of following through.”
The Senate doesn’t appear likely to vote on its version of the bill soon. With lawmakers focused on a tax bill that will disproportionately benefit the wealthy, Brooks says funding for the program could be part of the end-of-the-year spending bill Congress needs to pass to avoid a government shutdown. Senators have told the New York Times as much. “We’re in a tricky time period. We have hope,” Brooks said. “We think Congress can get this done.” Until then, 9 million kids will be waiting.
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