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Congress Puts CHIP Back on Course

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CHIP blog photo

The news was almost lost amid the furor over the government shutdown and immigration politics. But it did happen. Funding for CHIP was extended for six more years on Monday.

Federal funding for CHIP, which provides health coverage for almost 400,000 Texas children, expired Sept. 30. Since then, members of Congress have given lots of verbal love to CHIP but claimed to be unable to find the money to finance the program for another six years. Over the ensuing 114 days, families worried, states made and began to exercise contingency plans, and Congress propped up the program for a few more months. 

All of those problems melted away yesterday when — in the span of about 12 hours — the Senate and then the House passed, and then President Trump signed the bill that reopened the federal government and puts CHIP on firm footing for the next six years.

“In this day and age, the only thing we have to be certain about is uncertainty itself,” said TMA President Carlos J. Cardenas, MD. “Six years of dependable CHIP funding is good news for the state budget, for Texas children, for their families, and for the physicians who care for them.”

CHIP covers physician and dentist visits, hospitalizations, prescription drugs, and more for kids up to age 18 whose families make too much to qualify for Medicaid but too little to afford commercial insurance. 

It’s a good deal for the families. They pay annual enrollment fees of $50 or less, and copays for office visits and medications of $3 to $35.

It’s a good deal for the state treasury. Children are generally healthy and not very expensive to insure. Since passage of the Affordable Care Act (ACA) in 2010, the federal government has picked up an “enhanced share” of the costs. For Texas this year, that’s 93 percent. So Texas taxpayers pony up about $70 million for a program that costs almost $1 billion. The April 2017 enrollment stats show CHIP covers 393,000 children in Texas; about 36,000 Texas women also receive prenatal care and post-delivery checkups with CHIP funds.

Under the law passed Monday, the enhanced rate stays in place through fiscal year 2019, it drops to 82.5 percent in fiscal 2020 and reverts to its pre-ACA match of 71 percent by fiscal 2021.

It’s not a bad deal for physicians. Even though CHIP pays the same low rate as Texas Medicaid, it generates far fewer complaints about paperwork and bureaucratic interference.

It's a good deal for the federal treasury as well — in the perverse world of Washington economics. According to the Congressional Budget Office, the net cost of the six-year extension is only $800 million, and a 10-year extension actually would have decreased the federal budget deficit by $6 billion. 

And, of course, it’s a great deal for the CHIP kids themselves. It helps them stay healthy, in school and on the job, and out of the emergency department.



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