Newsday Profiles North Carolina’s Decision to Halt CHIP Enrollment

Faced with an estimated $800 million budget shortfall this year and increasing enrollments, North Carolina has become the "first state" officially to place an enrollment freeze on its separate, non-Medicaid CHIP program, creating a 7,084-child waiting list, Newsday reports. Like the rest of the nation, North Carolina is "feeling the pinch" of a slowing economy and officials said they "can no longer afford to increase the state share to serve more children." At a time when the state has declared a "budget emergency," the CHIP program would require nearly $8 million in state funds to serve all eligible children in the program and on the waiting list. In addition, while the program currently has enough money for the 68,500 enrolled, it would have difficulty sustaining services for that number without more funding. State officials have said that the state failed to budget enough because the initial funding for the program, which began in October 1998, was based on "flawed federal numbers" that "underestimated the number of eligible children." The state had anticipated 64,000 would enroll. By last December, enrollment had reached 72,000 and health officials estimate that an additional 30,000 are eligible. With outreach efforts that included advertisements on pizza boxes and trays at McDonald's and an application process designed to be easy, North Carolina's CHIP program had been seen as a model for others states developing similar programs. "We became a victim of our own success," said Dr. Wallace Brown, a member of the program's task force (Barfield, Newsday, 3/19).