By Martha Heberlein

Health coverage may now be an option for almost 22,000 children currently on the waiting list for CHIP (aka KidsCare) in Arizona under an 1115 waiver amendment approved on April 6th by CMS. The state had been negotiating to establish additional funding streams for uncompensated care payments to certain hospitals and Indian health services and CMS required that a portion of the funding be used to cover children waiting for the KidsCare program.

These children will be covered under a new program, called KidsCare II. There are a few limitations – in order to be eligible, a child must have family income between 100% and 175% FPL (as opposed to 200% in KidsCare) and either be on the waiting list or aging out of Medicaid. The benefits and the premium requirements will be the same as the regular KidsCare program. KidsCare II will also be temporary, with coverage extending from May 1, 2012 through December 31, 2013, when these children will transition to coverage provided on the Exchange.

Starting Monday, the state began sending notices to families with children who had been on the waiting list  – starting with those who had been waiting the longest – informing them of the opportunity to re-apply for coverage through the state’s online application.

Arizona is currently the only state with an enrollment freeze in place. Since it was instituted in late December of 2009, enrollment in KidsCare has dropped from almost 47,000 to just over 12,000 in January 2012. As of March 15, 2012, there were about 106,000 children on the waiting list for coverage.

KidsCare II will make a dent in the waiting list and certainly help thousands of families, but thousands will likely have to continue to wait for an affordable coverage option.