What Does the Future Hold for CHIP?

It’s hard to recall in the new age of Obamacare, but it wasn’t long ago that we were toasting an accomplishment that seemed unlikely just a short time before: the Children’s Health Insurance Reauthorization Act of 2009 (CHIPRA). Gone (for the most part) were the concerns about states running out of funds and wait-listing children, gone were the disincentives for states to be successful enrolling already-eligible children. CHIPRA was a hard-won precursor to the Affordable Care Act (ACA), and one that has continued to bear fruit for children’s coverage.

Of course, the efforts less than a year later to pass the ACA brought many new ideas about the best ways to cover more Americans, including some that suggested CHIP was no longer needed with the advent of exchanges. The fundamental question: Why not just put CHIP kids in the new exchanges (or marketplaces) with their families?

As many SayAhh! readers know, we at CCF did not feel confident about simply eliminating CHIP without knowing the alternative. After all, CHIP brought about many of the very enrollment and outreach successes for kids (also extended to Medicaid!) that the ACA sought to emulate. While the new marketplaces will be important new pathways to coverage for uninsured adults, that does not mean that it also makes sense to take children out of the coverage they know into a new, untested system. The compromise was CHIP funding through 2015 and the requirement that any state seeking to place children in exchanges receive signoff from the HHS Secretary, who must ensure that the marketplace qualified health plans (QHPs) are comparable to CHIP when it comes to benefits, premiums, and cost-sharing for families.

So here we are on the eve of full ACA implementation, and this question—Why not just put kids into the new marketplaces?— remains. States are already making plans and assumptions about the future of their CHIP programs—moving kids into Medicaid (CA, NH) or, in the case of Arkansas, planning to move them into the marketplace in future years. (See our thoughts on Arkansas’s plan here and here.)

This poses a challenge for child advocates. We admittedly have a patchwork of coverage for children with CHIP as a vital component (despite pre-CHIP efforts to simply raise the eligibility floor for Medicaid!). And now we add coverage for families through marketplaces to the landscape. Moving forward, what is the most effective way to cover kids? At the end of the day, we want children—regardless of where they get their coverage—to receive the health care they need to grow into healthy adults at a price their family can afford. This new coverage system renews important questions about whether government, the private market, or some combination of the two is the best means to do that (Blurred lines indeed!). We are certainly no strangers to this public/private question, but the move to a new post-reform era reminds us that no matter what happens to any one program or another, it is imperative that we work on ALL coverage fronts to make sure children and their families get what they need when they need it.

As for what happens next with CHIP: For the foreseeable future and likely well beyond, we need to keep CHIP strong and stable for a number of reasons.

CHIP works. Now is not the time to mess with success. We have worked hard over many years to make CHIP and Medicaid available to kids in low- and moderate-income families, and rightly celebrate our hard-won success regularly. Never hurts to say it again:  Together, Medicaid and CHIP have brought the uninsured rate for kids to historic lows! The logical question, then, is: Why on earth would we upend something that is working well for states, popular among voters, and, most importantly is familiar to families? Better to have a firm understanding of how the new coverage pathways are working for parents and other adults before fundamentally changing a crucial program for kids that works well right now.

Without CHIP, many kids would lose their only affordable coverage option. It seems crazy that with all the progress we’ve made covering kids that it would be possible to actually lose ground, but that’s exactly what could happen if CHIP goes away.  Thanks to the family penalty (also referred to as the “family glitch,” or “firewall”) kids in families with incomes that would otherwise qualify for credits to purchase coverage on the exchange will be iced out of that financial support. The Government Accountability Office (GAO) estimates that without CHIP, roughly 2 million kids could go without coverage.

We don’t know what we don’t know. We should understand how families fare in the new world of coverage before we pull the carpet out from under kids. What do kids get now and how does it compare to the alternative? With our colleagues at the National Academy of State Health Policy, we are doing our homework here at CCF to gain a better understanding of precisely what state CHIP plans provide today. We hope it will allow us to gain a firmer grasp on how they might compare to what kids could get elsewhere.  Stay tuned.

It is indeed time to reflect on CHIP’s role in the past and contemplate what lies ahead. We need CHIP to be stably funded well beyond 2015 to ensure no kids fall into the cracks and become uninsured. But we also cannot lose sight that Medicaid—a larger, more comprehensive coverage source for millions of the lowest income kids and children with special health care needs—is not immune to very real threats in the coming months and years. So as we look ahead, let’s take the broad view by starting with what kids need from health coverage and then determining the most appropriate means to protect and build on our progress.

 

Elisabeth Wright Burak is a Senior Fellow at the Georgetown University McCourt School of Public Policy’s Center for Children and Families.

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