Benefits

If a state has elected to use its child health funds to expand Medicaid coverage, the Medicaid program rules on benefits and the scope of coverage will apply to the group of children covered under the expansion in the same manner that they apply to children already eligible under the Medicaid program. If a state elects to use its CHIP funds to cover children under a separate state program, however, states have other options for meeting minimum federal benefit standards.

States can choose health benefits coverage equivalent to those offered under:

• the standard Blue Cross/Blue Shield preferred provider option service plan offered to federal employees;
  
• a health plan available to a state's public employees; or
  
• the HMO within the state that has the highest commercial enrollment (excluding Medicaid enrollment).
  

A state can also choose one of these three plans to serve as a "benchmark" for an alternative package of benefits. Finally, federal officials have the authority to allow states to use alternative benefit packages if they determine that they are appropriate for low-income children.

Under the 2009 CHIP law states must also provide dental services in their CHIP plans and can use CHIP funds to provide coverage or cost sharing help to children who have private insurance.