Do Nine Million Children Really Need CHIP?
September 19, 2014
In 1997, Congress passed the Children's Health Insurance Program (CHIP), intended to provide health insurance to children of families with incomes too high to qualify for Medicaid. But with the passage of the Affordable Care Act, Conor Ryan and Sang Kim of the American Action Forum ask whether CHIP -- which is up for reauthorization in 2015 -- is still a necessary program.
At the end of 2013, 6 million children -- out of the 9.1 million eligible for coverage -- had CHIP insurance. Of those, however, 6.4 million within the CHIP population have access to affordable health insurance from other sources (5.1 million would qualify for subsidized insurance in the Obamacare exchange, while 1.3 million could access employer-sponsored coverage through one or both of their parents).
Therefore, there are only 2.7 million American children within the eligible CHIP population of 9.1 million who actually need funding through CHIP. For example:
- 1.6 million children in CHIP would not qualify for premium tax credits through their parents' employer coverage, because the IRS bases its assessment of "affordability" on the cost of the individual employee's coverage, not on the overall family cost. If employer-sponsored coverage is deemed affordable, the family does not qualify for subsidies. Ryan and Kim call this the "family glitch."
- 645,000 children currently uninsured, but who qualify for CHIP, would also fall into the "family glitch."
- 460,000 children receive CHIP coverage due to various states' expansions of their Medicaid programs.
Source: Conor Ryan and Sang Kim, "Who Still Needs CHIP?" American Action Forum, September 15, 2014.
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