Health Insurance for children

The State Children’s Health Insurance Program SCHIP

In an attempt to address the growing number of children in the US without health insurance the State Children’s Health Insurance Program (SCHIP) was created. This is a national program that provides health insurance for families who earn too much money to qualify for Medicaid, yet cannot afford to buy private insurance.

On October 1, 1997 this program went into effect and was administered by the Centers for Medicare and Medicaid Services (CMS). This program provided the State Children’s Health Insurance Program (SCHIP) with $ 24 billion in federal matching funds over 10 years to help states expand health care coverage to over 5 million of the nation's uninsured children. This was the largest expansion of health insurance coverage for children in the United States since Medicaid began in the 1960s.

SCHIP is jointly financed by the Federal and State governments and is administered by the States. Within broad Federal guidelines, each State determines the design of its program, eligibility groups, benefit packages, payment levels for coverage, and administrative and operating procedures. SCHIP provides a capped amount of funds to States on a matching basis for Federal fiscal years 1998 through 2007. SCHIP covered 6.9 million children at some point during Federal fiscal year 2006, and every state has an approved plan.

States are given flexibility, and an enhanced match is paid to states. Some states have received Section 1115 demonstration authority to use SCHIP funds to cover the parents of children receiving benefits from both SCHIP and Medicaid, pregnant women, and other adults.

In 2007, researchers from Brigham Young University found that children who drop out of SCHIP cost states more money because they shift away from routine care to more frequent emergency care situations. In a 2007 analysis by the Congressional Budget Office, researchers determined that "for every 100 children who gain coverage as a result of SCHIP, there is a corresponding reduction in private coverage of between 25 and 50 children." The CBO speculates this is because the state programs offer better benefits and lower cost than the private alternatives.

The program cost $40 billion federal dollars over 10 years. Despite SCHIP, the number of uninsured children continues to rise, particularly among families that cannot qualify for SCHIP. An October 2007 study found that 68.7 percent of newly uninsured children were from families 200 percent above the federal poverty level.

A proposal was made to expand SCHIP from $5 billion yearly by $35 billion over five years and was recently passed in the Congress. However it was vetoed by President George W. Bush. An attempt to override the president’s veto was made by the House of Representatives today, October 18, 2007 failed by a vote of 273 to 156 for a 13 vote shortage of the two-thirds majority needed for override.

Additional info available http://www.cms.hhs.gov/LowCostHealthInsFamChild/