States Struggle as Members Scramble on CHIP Deal

The lowered price tag has helped smooth the pathway to renewal, but lawmakers may now disagree on how long funding should last—and states can’t afford to wait.

Sarah Cameron holds up a photo of her two sons, 8-year-old Trevor, and 5-year-old Austin, as she talks about the Children's Health Insurance Program during a news conference Dec. 7 in Pittsburgh.
AP Photo/Keith Srakocic
Erin Durkin
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Erin Durkin
Jan. 15, 2018, 8 p.m.

House Republicans appear confident they are near an agreement on funding for a program that provides health coverage to around 9 million kids, but the waiting game has left states in a dangerous limbo.

States and families have lived in an environment of uncertainty since Congress failed to renew funding for the Children’s Health Insurance Program at the end of September. This turmoil is already taking a toll, experts say, and some states will start running out of money and programs will close. But lawmakers may be on the verge of a long-term solution.

“For families, it’s a lot of confusion and a lot of worry about what they are going to do to meet the health care needs of their children if CHIP is no longer available to them,” said Samantha Artiga, analyst at the Kaiser Family Foundation.

States have already prepared to shutter their programs and notify families about possible loss of coverage. For example, Connecticut informed parents that the state expected to close the program at the end of January. This changed when lawmakers provided some short-term funding to states—$2.85 billion—as part of the government-funding bill in December, but the program is only expected to last through February.

“The bad news travels fast,” said Joan Alker, executive director of the Center for Children and Families at Georgetown University. “I worry that there may be a chilling effect.”

But the icy partisanship that existed around the CHIP negotiations could be ready to thaw. The Congressional Budget Office updated their estimates showing reauthorizing the program would cost $800 million rather than $8.2 billion over 10 years.

Energy and Commerce Committee Chairman Greg Walden said he is eyeing extending the program for six years and offsets may not be needed. “If we go to six years, it may have no cost,” he said.

This could remove the major stumbling block to reaching a solution. The Republican proposal renewing the program for five years used pay-fors that Democrats opposed.

Rep. Fred Upton, who also serves on the committee, said there is a lot of support behind passing a longer-term extension this week as part of the government-funding bill. “There is a pretty solid block of folks that will not vote for a [continuing resolution] unless CHIP is part of it, and I feel pretty good that it’ll be there,” he said.

Their Democratic counterparts, however, may press for an even longer renewal. “I’m going to push for as long a CHIP reauthorization as we can possibly get because it is such an attractive deal,” said Senate Finance Committee ranking member Ron Wyden, adding that making the program permanent should be an obvious move.

Analysis from the CBO on a 10-year extension, requested by Energy and Commerce Committee ranking member Frank Pallone, found that it would decrease the deficit by $6 billion. “After showering corporations and the wealthiest few with tax cuts, Congressional Republicans have created a situation where we can provide permanent coverage to millions of kids through the CHIP program,” said Pallone in a statement last week. “This should be a no-brainer—we should stop the uncertainty and permanently extend CHIP.”

If Congress fails to come to a long-term agreement and punts for a few more months, this could have severe consequences on states that are already struggling to manage their programs in an unpredictable environment.

“They’ve reached the end of the road for the short-term fixes for a variety of reasons,” said Alker. “States just have to have a firmer terrain here, or I think a number of states have expressed that they’re gonna have to act as if the funding is going away if they punt again. It’s just a huge crapshoot if they do that, it’s very unwise, and it’s gambling with children’s health and their future and a family’s peace of mind.”

A Georgetown University report released last week found that 11 states would exhaust all of their available funds before the end of February. The redistribution pool—leftover money in the program from past years—might be sufficient to cover February shortages, but it is difficult to predict, the report says.

“If Congress fails to approve long-term funding for CHIP in January, nearly 1.7 million children in separate CHIP programs in 21 states with shortfalls in March 2018 could lose coverage by the end of February 2018,” the report states.

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