As CHIP Expires Unrenewed, Congress Blows Chance to Save Healthcare for 9 Million Children

CD Editor's note: This op-ed was initally published by the Los Angeles Times on Friday, September 29, 2017, before Health and Human Services Secretary Tom Price resigned Friday evening and federal funding for the children's healthcare program expired on Saturday.

Advocates for children's health started worrying months ago that congressional incompetence would jeopardize the nation's one indisputable healthcare success--the Children's Health Insurance Program (CHIP), which has reduced the uninsured rate among kids to 5 percent from 14 percent over the two decades of its existence.

Their fears turned out to be true. Funding for CHIP runs out on Saturday, and no vote on reestablishing the program's $15-billion appropriation is expected for at least a week, probably longer. That's the case even though CHIP is one of the few federal programs that has enjoyed unalloyed bipartisan support since its inception in 1997. The consequences will be dire in many states, which will have to curtail or even shut down their children's health programs until funding is restored. Hanging in the balance is care for 9 million children and pregnant women in low-income households.

What happened? The simple answer is that congressional Republicans' last harebrained attempt to repeal the Affordable Care Act got in the way. A funding bill for CHIP seemed to be well on its way to enactment until a week or so ago. That's when the effort to pass the egregious Cassidy-Graham repeal bill sucked all the air out of the legislative room.

Agreement on a bill had been reached in mid-September by Sens. Orrin Hatch (R-Utah) and Ron Wyden (D-Ore.). "Momentum was building," says Bruce Lesley, president of First Focus, a children's advocacy group in Washington. Then came Cassidy-Graham, and "we couldn't even get a meeting," Lesley says. "No one was even taking our calls."

The impact of delay varies by state, because states are able to apply unspent CHIP money in any fiscal year to the next year. But even those with money in their coffers can't escape the consequences of Congress' inaction. Because they can't merely assume that Congress will eventually get around to reauthorizing the funding, they have to start planning to shut down their programs now, or reallocate funding from other social programs. According to Medicaid officials, who manage CHIP from the federal end, California, Arizona, Minnesota and North Carolina will run out of CHIP funding by December or early in January. Half the states won't make it beyond the first three months of 2018. Some will run out of money next week.

"There are huge ramifications in pretty much every state across the country," Lesley says.

Minnesota Human Services Commissioner Emily Piper warned her congressional delegation on Sept. 13 that the state's $115-million allotment for CHIP would run out this weekend, throwing healthcare for low-income children, infants, and pregnant women into chaos. The only way to save their care, even temporarily, would be through an intricate series of funding shifts it took Piper two densely worded paragraphs to explain.

Utah sent a warning Sept. 15 to Medicaid administrators that the state would have to roll up CHIP starting immediately if funding wasn't enacted by Saturday. Utah's senior senator is Hatch, who co-founded CHIP with Sen. Ted Kennedy (D-Mass.) in 1997 and has called providing children's healthcare "a moral responsibility," but couldn't manage to move a funding bill to the floor in time.

In today's dysfunctional political environment, even the traditional bipartisan support for CHIP has come apart at the seams. The Affordable Care Act bumped up all CHIP allocations to states by 23 percentage points from 2014 through 2019, bringing the total federal share to 100 percent for some poorer states such as Mississippi and West Virginia, and no less than 88 percent for all others.

That enhanced funding became a bone of contention for congressional conservatives, who wanted the increase axed outright. Supporters of children's health, meanwhile, wanted the increase made permanent. The compromise reached between Hatch and Wyden will kill the increase, but wind down the funding over four years instead of immediately.

By the way, if you're wondering why Health and Human Services Secretary Tom Price hasn't bothered to sound the alarm about CHIP funding, which falls within his bailiwick, consider that as a Georgia legislator he voted twice against expanding the program in his state.

Losing the 23-point bump will be costly across the board. California, as the largest state, would lose more than $600 million of a federal grant that reached $2.7 billion in the current year. But if the cut were enacted this year, Mississippi's appropriation would fall to about $243 million from $317 million, money it can ill afford to go without.

The main problem facing CHIP, however, is congressional resistance to making it permanent. Under current law, the program has to be reauthorized every few years; Saturday's deadline was the product of a two-year extension negotiated in 2015, the most recent episode of brinkmanship over whether Congress would act in time to avoid disruption. This time it failed.

To avoid the chaos, the Medicaid and CHIP Payment and Access Commission (MACPAC), a nonpartisan congressional advisory body, recommended in January that CHIP be extended by five years to 2022, the better to inoculate the program from "heightened...uncertainty about the stability of the exchange market" and proposals to "change the structure and financing of the Medicaid program."

MACPAC also recommended extending the 23-point funding bump to 2022 and eliminating a six-month waiting period imposed on children who lose employer-sponsored insurance.

Is there any more poignant example of how Congress' wasteful partisanship affects ordinary Americans? It's hard to imagine one. If the lawmakers can't act in support of a program that was enacted in a spirit of bipartisanship and serves the most truly defenseless members of society, there's no hope for them.