It has been more than three months since Congress failed to authorize funding for the Children’s Health Insurance Program (CHIP). Despite urgent pleas from governors, providers and families, Congress has yet to deliver long-term funding for this vital program. In less than two weeks, Congress is up against a looming deadline to pass a continuing resolution to keep the federal government operating. It’s imperative that the continuing resolution include at least five years of funding for CHIP.
The CHIP program has enjoyed robust bipartisan support since its establishment more than 20 years ago. Although Congress periodically needed to take action on CHIP funding, this is the first time in the program’s history that they allowed funding to lapse. For the more than nine million children and pregnant women who rely on the program for health care, the situation has reached a crisis point.
A brief look back
The last few months have been a roller coaster for the CHIP program. Congress permitted CHIP funding to lapse on September 30, 2017 and states started to rely on a small pot of leftover funds. In early November, both the House and the Senate passed legislation extending CHIP funding for five years. However, the two chambers did not agree on how to pay for the program. The Senate chose not to include details on how it would pay for CHIP, while the House proposed raiding the Affordable Care Act’s Prevention and Public Health Fund and jeopardizing other health priorities to fund CHIP.
During the fall, states began sounding the alarm about the impact of dwindling CHIP funding. Some states indicated that they would have to freeze CHIP enrollment and others sent notices to families to alert them that their children’s health insurance might be ending. In response, Congress passed a measure allowing the Centers for Medicare and Medicaid Services (CMS) to redistribute the available leftover funds. Congress intended this measure to give them a bit of additional time to pass long-term funding. Even with this short reprieve, Congress was not able to get its act together to fully fund CHIP. Instead, they passed another short-term patch just before leaving for the winter holidays, which analysts thought would provide only the smallest amount of breathing room.
Where are we now?
Unfortunately, Congress has pushed the CHIP program to a crisis point. Despite the short-term patch passed in late December, CMS has confirmed our fears by announcing that some states may run out of funding in the next few weeks, while others will run out shortly after that. The situation is especially dire because most states’ legislative sessions are beginning and decision-makers need to know whether and how much federal funding will be available for CHIP so they can pass their own budgets.
At this point, Congress has the opportunity to provide families, providers and states with a sigh of relief by including CHIP funding in the must-pass January 19 continuing resolution to keep the federal government open. Just a few days ago, the Congressional Budget Office (CBO) made that opportunity much easier by releasing an updated estimate of how much CHIP will cost. CBO determined that the cost of refunding CHIP is substantially less than previously estimated—$7.5 billion less—due to anticipated increases in Marketplace premiums. The rise in premiums is the result of stripping the individual mandates requirement from the ACA—a provision Congress included in the end of the year tax bill. However, the price tag for CHIP could be even sweeter. CBO has also projected that a 10-year extension of CHIP would save the government $6 billion. These new cost estimates mean that Congress could save billions of dollars by extending CHIP funding for 10 years or at most Congress would only need to find $800 million to fund CHIP for five years.
Let’s tell Congress it’s time to take action and provide long-term funding for CHIP. Our kids can’t afford to wait any longer.