10 August 2022 | Health

Happy 25th birthday, CHIP!

Heather Braum | August 10, 2022

August 5 marked an important milestone in kids’ health insurance history: on that day in 1997, the Children’s Health Insurance Program (CHIP) was signed into law. Because of the program, thousands of Kansas kids gained insurance coverage, and it helped decrease the child uninsured rate from 7.8% in 2008 to 5.8% in 2019. But when the 2008 Kansas Legislature last significantly updated CHIP-related laws, an error was made that affected the CHIP eligibility level — an error that must be permanently fixed by the 2023 Legislature.

25 Years of CHIP

Building on Medicaid’s success over the last 25 years, CHIP is a critical piece of the federal-state response to children’s health care needs. The program covers kids whose families earn too much to qualify for Medicaid but too little to afford private health insurance.

Medicaid and CHIP work together to provide free or low-cost health coverage for kids, covering important services like doctor and dentist visits, immunizations, prescriptions, and hospital stays. These programs are a lifeline for families in Kansas who aren’t offered or can’t afford health insurance for their children on their own. They are designed to work together to meet children’s health care needs and ensure that no one is left behind.

Georgetown University’s Center for Children and Families recently released a report examining the 25 years of CHIP’s impact on kids’ health and health insurance access and opportunities to remove barriers to insurance access.

Health insurance coverage is essential to a healthy childhood. Research shows when kids have health coverage, they are more likely to be ready to learn, do better in school, go to college, and succeed in life.

As of March 2022, 67,839 Kansas kids were enrolled in the CHIP program.

However, when the COVID-19 continuous coverage protections are eventually lifted, thousands of children in Kansas are at risk of becoming uninsured. This will disproportionately affect children who face geographic, racial, and/or language barriers. If the 2023 Legislature does not permanently fix an error in Kansas law, even more children are at risk of becoming uninsured.

CHIP Eligibility Issue Fixed...for Now

KAC learned of an error in the CHIP eligibility income guidelines in Kansas law that dates back to 2008 when Kansas expanded CHIP eligibility to be up to 250% of federal poverty income guidelines. But in the final version that became law, bill language indicated that the level would be up to 250% of the 2008 federal poverty income guidelines. The 2008 reference was never updated or removed. Further research uncovered that no other state references a specific year for their CHIP eligibility percentage, and no other place in Kansas law that references federal poverty income guidelines references a specific year. It turns out this “2008” year language in Kansas statute was an outlier.

With this 2008 reference included in the law, Kansas must annually convert and reduce the CHIP eligibility threshold as the current federal income poverty guidelines increase each year.

The Kansas Medicaid program annually submits a State Plan Amendment (SPA) with this converted percentage (see table below). In 2021, Kansas CHIP eligibility at 250% of the 2008 federal poverty income guidelines converted to 225%. The 2022 conversion was expected to be much lower than 225%.

These decreasing income levels mean that many Kansas children have lost their CHIP coverage over the last 14 years – even if their family income didn’t change. And more Kansas children will continue to lose their coverage if this error is not fixed.

During the 2022 legislative session, KAC advocated for a permanent fix to this error. SB 407 would have removed the year-specific language for the CHIP eligibility federal poverty income guidelines so Kansas families are on an even playing field with every other state in the country. While the bill only removed the year-specific language in law — and did not expand CHIP eligibility — it failed to receive any floor vote.

Fortunately, lawmakers added funding for a one-year fix and approved $1.4 million (including nearly $394,000 from the State General Fund) for a one-year fix to provide CHIP coverage for kids in households with a total income that falls beneath the 250% federal poverty income guidelines, temporarily ignoring the “2008” year reference in Kansas law. SB 407’s fiscal note had estimated that over 550 children would benefit from this fix in 2022-2023.

Again, though, this one-year fix is just temporary. When the 2023 Legislature convenes in January, we will work with lawmakers to permanently correct this error in Kansas law. If we don’t permanently fix the issue or pass another temporary fix, the 225% threshold in the 2021 Medical Assistance Standards will once again begin to decrease as it has for the past 14 years, jeopardizing health insurance for many Kansas kids.

As we mark the anniversary of CHIP and its successes across the last 25 years, we celebrate a bipartisan commitment to caring for our nation’s kids. The CHIP program has connected thousands of Kansas kids to insurance coverage. It would be even better if, in CHIP’s 25th year, the 2023 Kansas Legislature permanently corrected this identified error so more Kansas kids can have their health care needs met.

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