No States Reduced Benefits Under CHIP in FY 2002, Report Indicates

Despite enrollment growth and widespread state budget deficits, no state cut its benefits package for CHIP programs in fiscal year 2002, according to panelists at an Urban Institute forum on Oct. 1. The panel introduced the Urban Institute's report, "SCHIP Dodges the First Budget Ax." The new report looks at trends, successes and shortcomings of CHIP offerings in Alabama, California, Colorado, Florida, Massachusetts, Michigan, Minnesota, Mississippi, New Jersey, New York, Texas, Washington and Wisconsin, which account for 64% of total CHIP enrollment, according to the report. While no state cut its CHIP benefits package this year, many states reduced their outreach efforts, the panelists reported. According to the report, CHIP was spared cuts largely because the program is "widely viewed as success[ful]" and is not too costly, especially compared with Medicaid. The program receives generous federal matching rates, which make it difficult to justify cuts, and CHIP is not an entitlement program, which makes governors and lawmakers feel they "have more control," the study authors said. In addition, because CHIP "explicitly" helps children, no politician wants to cut the program during an election year, the report states (Howell et al., "SCHIP Dodges the First Budget Ax," Urban Institute, 10/1). However, despite the program's success in insuring 3.8 million low-income children, budget crunches may compel state officials to decrease the number of children participating in the program and trim costs by reducing eligibility requirements or capping enrollment, instituting more rigorous enrollment procedures, cutting back on benefits, adjusting cost sharing and restricting physician reimbursement rates, according to Genevieve Kenney, a principal research associate at the Urban Institute. Jason Cooke, director of Medicaid/CHIP with the Texas Health and Human Services Commission, noted that the benefits of CHIP will not be seen for many years, when children are older and the status of their health based on childhood care can be evaluated (Joelle Pauley-Fine, Kaiser Daily Health Policy Report, 10/1). The complete report is available online. Another Urban Institute report, "Five Things Everyone Should Know About SCHIP," also is available online. Note: You must have Adobe Acrobat Reader to view the reports.

In addition, a HealthCast of the briefing to release the report is available online.