The Patient Protection and Affordable Care Act (ACA) reauthorized the Children’s Health Insurance Program (CHIP) through FY 2019, but it did not provide new funding beyond FY 2015. Congressional leaders on both sides of the aisle and the administration have indicated a desire to extend CHIP funding. In addressing the lack of funding, policymakers face numerous considerations, including whether to extend funding for the remaining four years of the program’s authorization, whether to extend funding for a shorter period of time, and whether to make other changes to the program as part of the funding extension.
Enacted with bipartisan support as part of the Balanced Budget Act of 1997, CHIP is a capped entitlement to states. The program was designed to provide maximum flexibility to states that choose to provide health insurance coverage to low-income, uninsured children whose family incomes exceed Medicaid eligibility levels. Approximately 8.13 million children received health insurance coverage through CHIP, at an authorized spending level of $21.1 billion in FY 2015. States have two years to spend their allocations. As policymakers consider an extension of CHIP funding, a number of other issues around timing and policy can affect coverage for low-income children.