Nine Days and Counting – The Fate of CHIP Remains Uncertain Amid Congressional Deadlock

Sheppard Mullin Richter & Hampton LLP


While congressional Republicans spent much of September pushing for passage of the Graham-Cassidy “repeal and replace” bill, other time-sensitive legislative tasks were left to languish, including a September 30 deadline to reauthorize funding for the Children’s Health Insurance Program (“CHIP”) that has since come and gone. The failure to timely reauthorize the program has put the fate of CHIP in limbo, at least in the short term.

CHIP is a joint state and federal program that provides low-cost health coverage to children in families with income too high to qualify for Medicaid but too low to comfortably afford coverage. Approximately nine million children currently rely on CHIP for health coverage. Although CHIP is largely federally funded, states are also required to make contributions to, design and administer the program for its residents. Some states administer CHIP as part of their Medicaid program, other states operate CHIP as an independent program, while yet others take a combined approach.

Although the Senate Finance Committee approved a bipartisan bill on October 4th that would provide the program with more than $100 billion over five years, things did not go as smoothly in the House. The House Energy and Commerce Committee considered a similar funding bill, but the effort devolved into partisan bickering. While House Republicans indicated a willingness to provide funding, they demanded cuts and adjustments to Medicare and the ACA to offset the cost. Unsurprisingly, many Democrats balked, resulting in the Committee’s narrow approval by a vote of 28 to 23 along party lines. Because the measure lacks broad bipartisan support, members of congress and observers worry that a resolution won’t be reached prior to states’ exhaustion of emergency measures. If Congress fails to act, the Medicaid and CHIP Payment and Access Commission (“MACPAC”) estimates that more than half of states will exhaust all available CHIP funding by March 2018. The next several months should provide greater insight into the future of the program at both a state and federal level.

*Samuel Gilkeson is a Law Clerk at Sheppard Mullin in the firm’s Century City office.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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