There’s much ado in the news today about what the “Graham-Cassidy” plan does with respect to CHIP.
Two impacts of Graham-Cassidy on CHIP are very clear. First, by cutting Medicaid, Graham-Cassidy would undermine the foundation upon which CHIP sits. Medicaid covers four times as many children as CHIP, so cutting Medicaid by imposing a per-capita cap makes it impossible for CHIP to do its job. Without a strong Medicaid program, CHIP simply cannot be as successful as it has been.
Second, by focusing on this partisan bill instead of spending time advancing the bipartisan bill to extend CHIP funding, Graham-Cassidy is distracting the Senate from acting on CHIP before the September 30th deadline. There seems to be a sense that children and states can wait for Congress to act later this Fall, or even until December. But we know that states will start to run out of money very soon, and well before the last dollar is spent, there are many decisions states must make to protect the children currently enrolled.
But beyond these clear impacts, what does Graham-Cassidy actually say about CHIP?
We know that the bill is crafted as an amendment to Title XXI of the Social Security Act, also known as the Children’s Health Insurance Program, or CHIP (though it amends other parts of current law too). CHIP but appears to be the chosen title because it allows Graham-Cassidy to impose restrictions on the use of federal funds for abortions without running afoul of Senate procedural rules. But beyond a procedural gimmick, does Graham-Cassidy actually change anything about CHIP?
What stands out first is that Graham-Cassidy adds money to Title XXI for its new block grant program (more about that here) totaling about $1.2 trillion, but does not add a single dollar for CHIP allotments. Contrary to claims made earlier today by Senator Cassidy, CHIP funding has not been extended and his bill does nothing to help the matter (see above re: how his bill actually makes CHIP matters much worse).
Watch Senator Cassidy’s comments on CNN clip below:
Digging in a little deeper, you’ll find that the CHIP benefit standards are referenced in Graham-Cassidy. But let’s be clear – Graham-Cassidy does NOT apply the CHIP standard to its new block grant program. Graham-Cassidy uses the CHIP benefit standard as a metric for reducing payments to states that provide coverage with an actuarial value that is lower than (i.e., is worse than) the lowest possible actuarial value allowed in CHIP. My colleague Tricia Brooks has more to say about that here.
Finally, Graham-Cassidy also makes an important change to the “strings” on CHIP funds. Under current law, states may not draw down federal CHIP funds unless they have an approved state plan. But Graham-Cassidy amends this requirement to make it clear that states can continue to receive federal funds for the new block grant program in Graham-Cassidy even if they decide to stop providing CHIP coverage to low-income children and families.
Graham-Cassidy undermines CHIP by cutting Medicaid. Not only does it fail to renew funding for CHIP, it is distracting the Senate from extending CHIP funding on time. Graham-Cassidy muddies the CHIP statute by adding a completely unrelated block grant program. It does not carry forward any of the benefit protections in CHIP to its new block grant program, and it does not require states to continue to participate in CHIP. Graham-Cassidy is a loser for children and families.
