The Children’s Health Insurance Program (CHIP) is a federal-state program enacted in 1997 that provides healthcare coverage for uninsured, low-income children who are not eligible for Medicaid. States have the option of administering the CHIP through their Medicaid programs, through a separate program, or a combination of both. The Federal government matches state spending for CHIP but Federal CHIP funds are capped.
Gillian I. Russell, Terminology, in FUNDAMENTALS OF HEALTH LAW 1, 5 (American Health Lawyers Association 5th ed., 2011).
Like Medicaid, CHIP is administered by the states, but is jointly funded by the federal government and states. The Federal matching rate for state CHIP programs is typically about 15 percentage points higher than the Medicaid matching rate for that state (i.e. a State with a 50% Medicaid FMAP has an “enhanced” CHIP matching rate of 65%). Every state administers its own CHIP program with broad guidance from CMS.
States can design their CHIP program in one of 3 ways:
1. Medicaid expansion (7 states, DC and 5 territories)
2. Separate Child Health Insurance Program (17 states)
3. Combination of the two approaches (26 states).
The Children's Health Insurance Program Reauthorization Act (CHIPRA) was signed in 2009. CHIPRA reauthorized the program, provided additional funding for CHIP, and made many improvements to the Medicaid and CHIP programs.
The Affordable Care Act of 2010 maintains the CHIP eligibility standards in place as of enactment through 2019. The law extends CHIP funding until October 1, 2015, when the already enhanced CHIP federal matching rate will be increased by 23 percentage points, bringing the average federal matching rate for CHIP to 93%. The Affordable Care Act also provided an additional $40 million in federal funding to continue efforts to promote enrollment in Medicaid and CHIP.
From Medicaid, Children’s Health Insurance Program, http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Childrens-Health-Insurance-Program-CHIP/Childrens-Health-Insurance-Program-CHIP.html (accessed April 21, 2012).