Governors Express Support for Extending CHIP

Washington, D.C. - In formal responses to the Senate Finance Committee and the House Committee on Energy and Commerce, governors from 39 states expressed support for the Children’s Health Insurance Program (CHIP) and urged Congress to extend funding for the program, noting the role the program plays in providing affordable and comprehensive coverage to children.

On July 29^th, 2014, Senate Finance Committee Chairman Ron Wyden and Ranking Member Orrin Hatch along with House Energy and Commerce Chairman Fred Upton and Ranking Member Henry Waxman sent letters to all 50 governors asking for their input to inform Congress’ action on CHIP. CHIP provides insurance coverage for more than 8 million children.

While the program itself is authorized through September of 2019, funding must be renewed before October 2015.

Taken together, the letters indicate support for the extension of CHIP, and outline a number of beneficial suggestions for program improvements that could accompany any funding reauthorization legislation.

A summary of the comments:

Governors overwhelmingly support the extension of CHIP funding. The letter requested states indicate whether and under what time frame CHIP funding should be reauthorized.

• All 39 letters supported extending funding for CHIP, noting how vital the program has been to providing affordable and comprehensive coverage to children.

• More than half of Governors (22) called for an extension of CHIP funding at least through the end of 2019. Specifically:
  • 15 governors called for funding through 2019 or the end of the maintenance-of-effort period;
  • 7 governors called for funding beyond 2019;
  • Another 2 governors requested funding for a minimum of 2 years but preferred funding for even longer;
  • Governors from 3 states suggested extending CHIP funding for 2-years, through fiscal year 2017;
  • The remaining 11 governors did not provided a suggested length for the funding extension.

• Governors generally agree that action should be taken in time for states’ budgetary cycles.

• To date, the annual federal allotment formula for the CHIP program has been working appropriately according to nearly all of the governors (35 of 39)—only two states indicated that the annual allotments under the formula have not been sufficient.

CHIP coverage provides cost-sharing and benefit protections for children. The Congressional letter requested information on the costs of CHIP coverage and benefits provided, as well as how that coverage compares to other available coverage in the state.

• Governors reported that CHIP is more affordable to consumers than Exchange or employer-sponsored coverage and generally has a richer benefit package. All 34 governors that mentioned the cost of care to consumers indicated that CHIP coverage is more affordable than private coverage, such as that offered on the Exchanges or by employers. For example:
  • 8 states did not have premiums or other cost sharing in CHIP;
  • 26 states had premiums and/or copayments in CHIP, but all indicated that CHIP cost sharing was less than what would be faced in private coverage; 
  • None of the states reported having a deductible.

• 24 states reported that the CHIP benefit package is more robust than benefits available in the private market, while 8 states reported that the benefits were comparable.
  • Benefits that governors reported were available or more generous in CHIP included:
    • Early and Periodic Screening, Diagnostic, and Treatment, for states with CHIP Medicaid expansion programs;
    • Dental, often provided without an additional policy or deductible;
    • Vision services, such as eyeglasses;
    • Hearing/Audiology services;
    • Transportation;
    • Mental health.

States have ideas for policy improvements.

• Governors’ suggestions for federal policies changes to CHIP generally fell into three categories:
  • Simplifying enrollment
  • Increasing state flexibility
  • Incentive payments to states

The full range of state feedback can be found by reviewing individual state responses. Those responses can be found here.

A link to the July 29 letter asking governors for comment can be found here.

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