The Children’s Health Insurance Program — otherwise known as CHIP — provides comprehensive health benefits to uninsured children up to age 19 whose family incomes are too high to qualify for Medicaid, according to Medicaid.gov. Though CHIP is administered by states, which have “broad discretion” in setting income eligibility rules, states and the federal government jointly fund the program.
For the past several months, CHIP and its funding have been up in the air, but the January 22, 2018, spending authorization is essential news for employers and employees. This CHIP update covers what both parties need to know about the future of the program.
What’s Happening With CHIP’s Funding?
According to the New York Times, funding for CHIP — which insures almost 9 million children — expired on September 30, 2017. Some short-term funding was approved by Congress, allowing the program to continue through the end of 2017. As NBC News reports, however, more than 1.75 million children in 20 states and Washington, D.C., were at risk of losing health insurance by the end of February 2018 if CHIP were not reauthorized.
Fortunately, the spending plan that enabled the government to reopen after the January 2018 shutdown provides a six-year extension of federal funding to the CHIP program, according to The Washington Post.
This money is crucial, because as the Kaiser Family Foundation (KFF) points out, without “stable long-term funding, states face ongoing uncertainty that contributes to challenges managing their programs as well as wasted administrative time and costs.” For the first two years of the six-year extension, federal funding will cover at least 88 percent of the program’s costs across all states, as The Washington Post notes.
What Should Employers Help Employees Do With the News?
Many families have been learning about the CHIP update through media coverage or, in some cases, notices from states, according to the KFF. Over the course of the funding battle, employees might not have been uniformly or universally informed about each new development. This is why it’s important to devise a strategy to clearly and authoritatively communicate this latest CHIP update to your employees, many of whom may have been worrying about how long health coverage for their children would be available and how this would impact family finances.
With the new federal funding ensuring the program’s continuance for the next six years, families will no longer need to consider switching to more expensive employer-provided coverage or Marketplace plan — or worse, worry about becoming uninsured altogether. But even though the new CHIP funding means that employees are less likely to change plans, this is a useful opportunity to examine your own plans and processes to make sure that the process of enrolling in them is understandable and smooth.
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