How CHIP Plays an Important Role in California’s Medi-Cal Program

How CHIP Plays an Important Role in California’s Medi-Cal Program

This post is part of Health Advocate Blog series about the importance of the Children’s Health Insurance Program (CHIP) to the health care system.

Medi-Cal provides a critical safety net for 5.7 million children in California. The Children’s Health Insurance Program (CHIP) builds on the foundation of Medi-Cal by providing comprehensive coverage to children in working families who earn too much to qualify for Medi-Cal but lack access to affordable private coverage. In California, CHIP funding expands coverage for children in the Medi-Cal program, covering 41 percent of all children and 42 percent of children with disabilities or special health care needs.

Absent congressional action, CHIP funding will expire at the end of September. If that happens, California would likely exhaust all available federal CHIP funding by January 2018. If Congress fails to act quickly to reauthorize CHIP, there may be dire consequences for California’s children:

  • Delayed or reduced federal CHIP funds means that California’s budget will be strained
  • California will have less money to administer the Medi-Cal program, pitting the health needs of children against other Medi-Cal populations
  • California will be hard pressed to enforce the Affordable Care Act’s maintenance of effort (MOE) provision that requires it to sustain existing Medicaid and CHIP eligibility levels for children through September 30, 2019
  • California will likely adopt cost-saving measures like reducing eligibility, reducing access to care or narrowing provider networks
  • California’s historic progress in achieving 97 percent of health insurance enrollment for children will be jeopardized

It is critical that Congress takes immediate, action to enact a five-year funding extension to stabilize CHIP and protect coverage gains for children. Although the Senate Finance Committee hearing on September 7 indicated there is strong bipartisan support for a CHIP extension, the need to act swiftly to pass legislation and get the president’s signature to enact is crucial. If the clock runs out California’s children and children across the county, they are the ones who will pay for it.

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