Comparison of the Bills to Extend State Children’s Health Insurance Program (CHIP) Funding

Summary

The State Children’s Health Insurance Program (CHIP) is a means-tested program that provides health coverage to targeted low-income children and pregnant women in families that have annual income above Medicaid eligibility levels but have no health insurance. CHIP is jointly financed by the federal government and the states, and the states are responsible for administering CHIP.

In statute, FY2017 is the last year a federal CHIP appropriation is provided. Federal CHIP funding was not extended before the beginning of FY2018. As a result, states do not currently have FY2018 CHIP allotments, and states are funding their CHIP programs with unspent federal CHIP funds from prior years. Some states are expected to exhaust this funding within the first quarter of FY2018.

On October 4, 2017, both the Senate Finance Committee and the House Energy and Commerce Committee had markups on different bills that would extend CHIP federal funding through FY2022, among other provisions.

The Senate Finance Committee approved the Keeping Kids’ Insurance Dependable and Secure Act of 2017 (KIDS Act, S. 1827), which would extend federal CHIP funding through FY2022 and extend the increased enhanced federal medical assistance percentage (E-FMAP) rates for one year (i.e., through FY2020) but with an 11.5 percentage point increase instead of the 23 percentage point increase under current law. The bill also includes extensions of other CHIP provisions (e.g., the Express Lane eligibility option and the maintenance of effort for children with incomes below 300% of the federal poverty level) and other programs and demonstrations (e.g., the Child Obesity Demonstration Project and the Pediatric Quality Measures Program).

The House Energy and Commerce Committee approved the Helping Ensure Access for Little Ones, Toddlers, and Hopeful Youth by Keeping Insurance Delivery Stable Act of 2017 (HEALTHY KIDS Act, H.R. 3921), which includes almost identical language to the KIDS Act that would extend CHIP federal funding through FY2022 and extend the increased E-FMAP for one year at 11.5 percentage points. The HEALTHY KIDS Act also includes almost identical language that would extend the same CHIP provisions and other programs and demonstrations as the KIDS Act. The HEALTHY KIDS Act also includes some provisions that are not in the KIDS Act, such as adding a new CHIP state option for qualified CHIP look-alike plans; modifying the Medicaid disproportionate share hospital allotment reductions; and providing additional Medicaid funding to Puerto Rico and the U.S. Virgin Islands. The HEALTHY KIDS Act includes the following provisions as offsets: modifications to Medicaid third party liability, treatment of lottery winnings for Medicaid eligibility, and Medicare Part B and D premium subsidies for higher-income individuals.