Federal “Maintenance of Effort” Protections Help Kids Maintain Health Coverage Amid Tough State Budget Climates

The Children’s Heath Insurance Program (CHIP) serves more than 8.3 million children in the United States.1 CHIP is jointly administered and financed by states and the federal government, but at the end of federal fiscal year 2015 (September 30), no new federal funding for CHIP will be available. Lawmakers from both parties have introduced plans to extend CHIP funding. However, while some plans to do so would keep CHIP structure and design intact, others would make changes that could reduce children’s coverage.

The discussion draft released by House Energy and Commerce Health Subcommittee Chairman Joe Pitts (R-PA), full committee Chairman Fred Upton (R-MI), and Senate Finance Committee Chairman Orrin Hatch (R-UT) would extend CHIP funding. Yet it would also, among other changes, cut federal CHIP funding for states and end the ‘maintenance of effort’ (MOE) requirement currently in place through September 2019.