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HEALTHLINE NEWS

What Happens If Funding for Children’s Health Program Expires?

Without last-minute funding from Congress, the Children’s Health Insurance Program will expire on Saturday. It provides service for 9 million children.

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Healthcare experts are sounding the alarm that nearly 9 million children could be at risk for losing health services.

They say that will happen if Congress doesn’t extend funding for a 20-year-old program that helps children of lower-income families get insurance.

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In recent weeks, members of Congress had been focusing on the Graham-Cassidy healthcare bill, while another healthcare program designed to help children could lose its funding after September 30.

The Children’s Health Insurance Program (CHIP) gives federal funds to states in order to provide health insurance coverage to children who aren’t eligible for Medicaid coverage.

Funding for CHIP is set to expire on Saturday, which could lead to a wave of disruption for children and their families in addition to the states that administer the program, according to experts.

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A bill to fund the CHIP program was introduced last week, but it remains unclear if either the Senate or the House will actually vote on it by this weekend.

CHIP, which was passed by Congress in 1997, costs approximately $13 billion a year with almost $10 billion paid for by the federal government, according to the Kaiser Family Foundation.

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In the 20 years since it was passed, every state has started providing coverage to children.

Nearly all allow families with annual incomes up to 200 percent of the federal poverty level to participate.

What happens if CHIP isn’t extended

States administer the program in their own way, so a lapse in federal funding will affect states differently.

Samantha Artiga, an analyst at Kaiser Family Foundation, said basically every state assumed that federal funding for the CHIP program would continue when they came up with their 2018 budget.

“If federal funding is not extended, nearly all states would face budget shortfalls,” she told Healthline.

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And, she added, some states “anticipate running out of funding soon.”

If federal funding falls through, state officials could face difficulty coming up with the funds to pay for the program, resulting in potential cuts or caps to their program.

“We’re really starting to bump up against deadlines where states are going to start to take actions,” Artiga said.

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The Kaiser Family Foundation estimates that at least 10 states will exhaust their CHIP funding by the end of 2017.

Even if Congress gets around to funding the program in the future, Artiga said missing Saturday’s deadline could lead to turmoil.

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Some states, including Nevada, have laws that require officials to freeze or close enrollment if federal funds decrease.

They could also end coverage by November 30 if there are no federal funds allotted.

“If Congress misses the deadline and comes back later for funding, there’s a potential for a lot of confusion in families and also wasted effort and expense for states,” she said.

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States at risk

One of the states facing a tight deadline is Minnesota.

Earlier this month, Emily Piper, the commissioner for the Minnesota Department of Human Services, sent a letter to the Minnesota congressional delegation warning that their CHIP funding will be exhausted by the end of September.

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In Minnesota, the program mainly covers children not eligible for Medicaid but also pregnant women who earn up to 278 percent of the federal poverty level.

Piper warned that without federal help, “pregnant women covered by CHIP would be at risk of losing coverage altogether.”

Piper said that the state may be able to redirect $10 million from their overall fund for these women, which could keep the program going for another nine months.

However, she warned that it would come at “significant financial penalty” to the state.

Piper urged the delegation to help get CHIP funding passed, calling the program “integral to providing health care to children in Minnesota.”

Leni Preston, the president of Consumer Health First, a Maryland-based advocacy group, said that her state has 137,000 children on CHIP.

Preston said Maryland would likely be able to keep the program afloat until next year, but that it could take a toll on the budget and potentially on residents.

“If Maryland is going to cover that, where is it going to come from?” she told Healthline. “The state budget is not a bottomless pit, and nobody wants to raise taxes.”

Artiga said states like Minnesota and Maryland may have to make difficult decisions about the program in order to keep their budgets balanced.

“There are a number of actions that they would need to take like closing or capping the program,” she explained.

Jim Kaufman, vice president of public policy at the Children’s Hospital Association, said he’s concerned that even if there is a temporary lapse, families could start to receive notices immediately that they will lose their coverage.

“It depends on the state,” he told Healthline. Some “will say we have to start to tell families. Other states will carry over more” of their own funding.

Kaufman said there is also the possibility that in some states, children’s medical care could be interrupted if there isn’t a vote on the CHIP federal funding by Saturday.

“The state might start to put in wait lists and put in disruption in care as well,” he said.

Senators Orrin Hatch (R-Utah) and Senator Ron Wyden (D-Ore.) introduced a bill this month that would extend funding for CHIP for the next five years.

“Introducing this legislation is an important next step toward ensuring uninterrupted funding for CHIP, providing much-needed certainty for the vulnerable children and families who rely on this critical program for health coverage,” Hatch said in a statement.

While both Hatch and Wyden said they hope to move the bill quickly through congress, it isn’t clear if the bill will even come up for a vote before Saturday’s deadline.

Officials at the American Academy of Pediatrics (AAP) pointed out last year that CHIP along with Medicaid have helped reduce the number of children without health insurance “to the lowest level ever recorded.”

“If CHIP funding is not extended beyond 2017, many CHIP-enrolled children and pregnant women would likely become underinsured or uninsured altogether, which would threaten their access to care and the historic gains made insuring children over the past two decades,” AAP officials said in a statement sent to members of congress last year.

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