How CHIP Funding will Change the Landscape of Open Enrollment

Federal funding for the Children's Health Insurance Plan (CHIP) has expired. What does this mean for Open Enrollment?

Federal funding for the Children's Health Insurance Plan (CHIP) has expired. What does this mean for Open Enrollment?

The crisis with CHIP funding puts pressure on parents to consider their options for Open Enrollment if that’s even financially possible. Some states have funding until the end of the year, some until next spring, and then there’s Minnesota whose funds only lasted through September before receiving a 3.6 million bailout. With CHIP serving 9 million children, millions of families in the US are left in a lurch. These families make too much to qualify for Medicaid and too little to afford a family plan in the majority of cases. Open Enrollment this year is already a question mark without children's health being at stake.

On one hand, CHIP will push some families to seek family plans during Open Enrollment while the rest will be knocked off of insurance altogether or lucky enough to be moved to Medicaid in some states. Pushing this decision early on families, Utah has informed the federal government that it intends to freeze the Enrollment process until funding is restored. It is possible for other states to follow Utah’s lead as money dwindles. Ultimately, because CHIP is a bipartisan favorite - possibly the only thing left that both Democrats and Republicans can agree upon - funding for CHIP will be renewed but not until some states have run out of money. Things are going to get chaotic during enrollment this year with some states likely choosing to send cancellation letters to families. Then, of course, Congress will finally renew the funding and those states will have to inform that the cancellation is no longer in effect or the families will have to sign up again, creating confusion if they are still covered or not. All this amounts to precious money wasted on paper and labor for something easily avoided by Congress. It would be a shame if some of the families are forced into purchasing insurance plans over their budget when Congress will eventually get funding renewed.

Not to mention that while the government sluggishly moves towards a resolution, children need care. Who will pay for the doctor visits in the meantime or the medications? Some children have chronic conditions like asthma or diabetes that require regular check-ups and a constant flow of medication. In states like Minnesota, whose CHIP funds ran out in September, parents will be forced to take on medical bills they can’t afford just to receive the care they previously received for free or no cost.

To complicate matters more, some states run CHIP as a separate entity and not under the Medicaid umbrella, so families may not even know they are depending on CHIP until they receive notice of cancellation. States who keep CHIP tied to Medicaid can use extra funds from Medicaid to keep CHIP afloat. If money runs out to keep CHIP afloat at least those families can be moved to Medicaid as a last resort, but for about 4 million children living in states where CHIP is separate from Medicaid, they are looking at no coverage at all.

In essence, while Congress goes through the lengthy process of approving a budget for CHIP and getting that signed by the President, real lives are at stake and confusion has already begun. Enrollment this year is already a mess because of the political instability with attempts to repeal the ACA and a possible freeze on federal cost-sharing subsidies, but with this situation added, we are looking at a lot of families in danger of being left out in the cold.

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