Should Congress Reauthorize CHIP?

The Children’s Health Insurance Program (CHIP) has been very helpful in providing children access to health care including preventative services such as well child visits and chronic illness screening since its inception. CHIP also provides much needed funding to the nation’s Children’s Hospitals which provide training for future general and subspecialty pediatricians as well as conducting pediatric research. Without CHIP, there would be a significant decrease in funding for Children’s Hospitals. This might potentially limit access to care for all pediatric patients regardless of their insurance status.

Over the past several years, many states have increased the eligibility for children in households that have incomes up to 400% of the federal poverty level to receive coverage through CHIP. Proponents argue that increasing income-based eligibility will help alleviate financial hardships for families who pay higher premiums for dependents on employer-based health insurance. Opponents argue that increasing eligibility will lead to crowd-out of families switching from private health insurance plans to public plans and creating large financial burdens on state budgets.

With the passage of the Affordable Care Act, federal funding for the CHIP program is only allocated until 2015 and will require further congressional support to continue funding. While there must be a reasonable limit to income-based eligibility, Congress must protect CHIP from extinction after 2015.

A recent article evaluated the effects of increasing eligibility of CHIP on the proportion of children who were uninsured, publicly insured, or privately insured.  Researchers studied 15 states with expanded eligibility from 2008-2012 and compared them to similar states without expanded eligibility. Using difference-in-differences approach, the authors evaluated changes between the three coverage groups: public, private, and uninsured.

In statistically adjusted models, the effect of CHIP for newly eligible children was to decrease the rate of uninsurance by 1.1 percentage points, increase public coverage by 2.9 percentage points, and decrease private coverage by 1.8 percentage points.

The data suggest that expanding the eligibility for CHIP has led some families to switch to public insurance due to their employers’ health care benefits being either too expensive or not comprehensive enough to meet their family’s needs.

commentary by Tyree Winters, DO

Abstract

Following the reauthorization of the Children’s Health Insurance Program (CHIP) in 2009, fifteen states raised their CHIP income eligibility thresholds to further reduce uninsurance among children. We examined the impact of these expansions on uninsurance, public insurance, and private insurance among children who became newly eligible for CHIP after the expansions. Using a difference-in-differences approach, we estimated that the expansions reduced uninsurance by 1.1 percentage points among the newly eligible, cutting their uninsurance rate by nearly 15 percent. Public coverage increased by 2.9 percentage points, with variations in take-up among the states. A better understanding of these state-level differences in take-up could inform efforts to enroll children who remain uninsured but are eligible for CHIP. CHIP is up for reauthorization in 2015, and further funding will be needed to maintain the program, which provides insurance to children who might not have access to affordable private coverage. PMID: 25253261

Goldstein, IM, et al. Health Affairs. 2014; 33 (10) : 1861-7.