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Senate Finance Committee Leaders Agree to Five-Year CHIP Extension

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Shelley Starkey

Project Assistant

Senate Finance Committee Leaders Agree to Five-Year CHIP Extension

September 14, 2017 | Children and Youth | Medicaid | Comments
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With funding for the Children’s Health Insurance Program (CHIP) nearing its expiration at the end of September, Senate Finance Committee leaders have announced a bipartisan proposal to reauthorize funding for the program for five years. Formal legislation has not yet been released, but Chairman Orrin Hatch (R-UT) and Ranking Member Ron Wyden (D-OR) have committed to help move the proposal through Congress this month. An identical proposal must also pass the House and be signed by President Trump.

 

HISTORY OF CHIP

A program with bipartisan support, CHIP currently provides affordable, comprehensive health coverage to roughly 9 million children and pregnant women who do not qualify for Medicaid, but whose families cannot afford other forms of health insurance. Since CHIP’s inception in 1997, the uninsured rate of children from ages 0 to 17 dropped from 13.9 percent that year to 4.5 percent in 2015. CHIP is currently funded in part by states, who receive federal funds at specific matching rates, much like Medicaid.

 

Under the Affordable Care Act (ACA), the federal match rate for CHIP was increased by 23 percent to help incentivize states to expand their coverage programs for children. The current federal match for CHIP is set to expire after September 30, which would leave states with limited funds to continue administering the program if no deal is reached.

 

THE ROAD FORWARD FOR CHIP

Senate Finance Committee Chairman Orrin Hatch (R-UT) and Ranking Member Ron Wyden (D-OR) announced their proposal on Wednesday in hopes to ensure stability for states by extending federal funding for CHIP for five years. To reach a bipartisan agreement, the current proposal would reduce the increased 23 percent match rate over the life of the extension, dropping to 11.5 percent in 2020, and eliminating the increase by 2022.

 

“CHIP is an effective, bipartisan program that helps to provide health coverage for vulnerable children and families,” said Chairman Hatch. “Congress needs to act quickly to extend the funding for CHIP. This agreement with Ranking Member Wyden is a good first start. Not only does this proposal provide uninterrupted funding for CHIP, but it also provides certainty and increased flexibility for states to administer the program. We will continue to work to advance this agreement in a way that does not add to the deficit, and I am hopeful we can move forward swiftly to ensure no lapse in care for our nation’s most vulnerable children.”