Where’s the Urgency?

States Could Run Out Of Children’s Health Insurance Program Funding in Just Two Weeks

Despite a boost in spending that was supposed to carry it through March.

Photo Illustration by Lyne Lucien/The Daily Beast

Before Congress went on break for the holidays at the end of last year, they attempted to solve a problem of their own making. In a short-term government funding measure, they allotted $2.85 billion to keep the Children’s Health Insurance Program (CHIP), afloat until, they estimated, the end of this March.

Just two weeks later, the Centers for Medicare & Medicaid Services concluded that the money in fact may only sustain state programs for another two weeks.

“We appreciate that Congress included funding for CHIP in the continuing resolution that runs through January 19, 2018,” CMS spokesperson Johnathan Monroe told The Daily Beast. “The funding included in the CR should carry all the states through January 19th based upon best estimates of state expenditures to date. However due to a number of variables  relating to state expenditure rates and reporting we are unable to say with certainty whether there is enough funding for every state to continue its CHIP program through March 31, 2018.”

CMS has begun to meet with states impacted by the immediate budget shortfall in an attempt to guide them through this continuing uncertainty.

This adds an additional sense of urgency for Congress, which let a September 30 reauthorization deadline come and go for the program which covers nearly nine million children and pregnant mothers nationwide.

The $2.85 billion in December did provide a lifeline, albeit a short one, to states where children’s coverage had been immediately threatened. That money was allocated less than a week before Alabama had intended to send post-Christmas notices informing families that they would be freezing enrollment for their All Kids program on January 1 and then would begin disenrolling children on February 1. In Connecticut, where prior to the December deal officials had warned that the state’s program covering some 17,000 children and teenagers would end on Jan. 31, is now funded only through February 28.

As the clock runs out on funding for children’s insurance, the Congressional Budget Office Friday estimated that a five-year reauthorization would increase the deficit by just $800 million between 2018 and 2027. It had previously estimated that cost at around $8.3 billion. Ironically, the steep decrease is attributed to the repeal of the Affordable Care Act’s individual mandate in the Republican tax bill.

“CBO and JCT (Joint Committee on Taxation) expect that premiums for coverage through the marketplaces will be higher in the absence of the mandate penalties than they would otherwise have been,” CBO explains. “As a result, the federal cost of enrolling a child in coverage through the marketplaces will be higher. Thus, funding CHIP for five additional years—causing some children to be covered in that program rather than through the marketplaces—would result in a larger reduction in spending related to the marketplaces than in the prior estimate.”