Ideas. Action. Results.

Children’s Health Insurance Program Should Be Extended, But Not Indefinitely, Urges New BPC Report

Friday, March 13, 2015

Washington, D.C.– The State Children’s Health Insurance Program (CHIP) should be extended for a minimum of two years at the current authorized 2015 level of $21.1 billion per year with the long-term goal of unifying families under the same health insurance program or plan. Those are some of the recommendations released today by the Bipartisan Policy Center (BPC) as policymakers consider ways to extend CHIP funding and preserve health insurance for the estimated 8.13 million people who receive coverage under the program.

While the Patient Protection and Affordable Care Act (ACA) reauthorized CHIP through 2019, the law does not provide new funding for the program beyond September 2015. BPC’s recommendations for addressing this problem are highlighted in its report, The Role and Future of the Children’s Health Insurance Program. The report focuses on issues that impact coverage for lower-income children, including: changes in federal funding, interactions with the ACA, challenges facing state budgets in 2016, and the administrative complexities families face when enrolling in and navigating the health care system.

“The current patchwork of coverage for parents and children is confusing, administratively burdensome for families, and an inefficient use of taxpayer dollars,” said Katherine Hayes, BPC Director of Health Policy. “Coverage gaps can and should be addressed, ending the need for CHIP.”

To accomplish this goal, BPC recommends:

  1. Extending CHIP for a minimum of two years.
  2. Extending CHIP funding at the current authorized 2015 level of $21.1 billion per year. Any increase in authorized spending over the current congressional assumed baseline spending of $5.7 billion per year must be offset to not increase the federal debt.
  3. Eliminating gaps in coverage by resolving issues related to the ACA, such as the so-called “family glitch.”
  4. Modifying eligibility for public and private coverage over the long-term to allow children and parents to be enrolled in the same insurance plan, eliminating the need for CHIP.
  5. Ensuring that differences in benefits and out-of-pocket costs in current employer-sponsored or exchange plans do not result in the loss of important benefits or in high cost-sharing for lower income children and their families.

“Whenever possible, parents and children should be enrolled in the same insurance policies,” added Hayes. “Our goal is two-fold: to unify families and prevent ‘churning’ in eligibility between programs and policies, and to protect lower income children and pregnant women from losing benefits and incurring high out-of-pocket costs.”

BPC health leaders believe that extending CHIP over the short-term will give states time to adjust their budgets, and federal policymakers time to address benefits and cost-sharing. The recommendations seek to ensure that high cost or coverage limitations of employer-sponsored and exchange plans do not prevent children and their families from accessing health care.

BPC’s full report will be available later this month.