State Children's Health Insurance Program (SCHIP) (U.S.)

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The State Children's Health Insurance Program (SCHIP) was created to provide health insurance coverage to children whose families made too much money to qualify for Medicaid but were too poor to pay for private health insurance. The program was created in 1997, and provides federal funds to states, with the states creating and administering individualized programs.

In 2007, during the 110th Congress, SCHIP came up for reauthorization for the next five years by Congress. A simple reauthorization would have cost $25 billion over five years, but both the House and Senate separately approved Democratic-led measures to dramatically expand the program. The initial House version expanded the program by $10 billion per year to a 5-year, $75 billion total. The initial Senate version expanded it by $7 billion per year to a 5-year, $60 billion total. The House and Senate eventually passed a version that relied largely on the Senate version, with a $60 billion total ($35 billion expansion) that would be largely funded by an increase in cigarette taxes from 39 cents to $1 per pack.

The bill was estimated by the CBO to bring the total number of children enrolled by the program to 10 million. Critics include the Heritage Foundation, whose writers said the bill covered too many middle-class children and was an inefficient alternative to encouraging healthcare coverage through tax breaks for insurance provided by for-profit companies.

President Bush vetoed the first bill on October 3, 2007. Democratic leaders in the House then passed a slightly different version on October 17, but failed to meet the 2/3 majority required to override the veto. On October 25, Democratic leaders unveiled another slightly modified version and scheduled a vote the same day.

Background on SCHIP program

The State Children's Health Insurance Program (SCHIP) was created in 1997 to provide matching funding to states to provide health care coverage to children - aged 18 and under - of families whose income was too high to qualify for Medicaid but too little to afford health insurance, a level pegged by the original legislation at twice the federal poverty level, or about $41,000 in 2007.[1] States are given the option of providing health care coverage by expanding their Medicare programs, funding private insurance programs, creating new state health care programs or some combination of the three. States could also apply for a waiver from the federal government to cover people other than children aged 18 and younger and families who exceeded the income limit.[2]

Income levels for eligibility and coverage

States have different levels of income for eligibility because they administer the programs themselves and are allowed to apply to the federal government for waivers for incomes in excess of 200 percent of the federal poverty level. As of February 2007, 25 states and the District of Columbia have income limits at 200% of the federal poverty line, 13 states exceed that, and 12 states have maximum income levels below 200%.[2] The highest is New Jersey, with an eligibility level of 350%, the only state to exceed 300%. According to the Congressional Research Service, 92 percent of those covered are below the 200% level (83% children and 9% adults) and 8 percent were from families with incomes higher than 200%.[1]

Eligibility and coverage of non-children

Some states cover people other than children aged 18 and under and are able to do so by applying for a waiver from the federal government. As of March 2006, 15 states had obtained waivers under the SCHIP program (for either partial or regular federal financing) to cover others: 12 states covered adults with children, typically parents of children enrolled in Medicaid or SCHIP; four states covered some childless adults; and nine states cover pregnant women whose children would be eligible for SCHIP when they are born and includes prenatal and childbirth services.[2] According to the Congressional Budget Office, 6.6 million children and 670,000 adults received coverage at some point in 2006.[1]

Children in 2006 who were eligible but not enrolled

In 2006, 5.4 million children eligible for SCHIP or Medicaid were uninsured (because states use a mixture of the programs in different ways, a total figure gives the most accurate picture). Of those, 1.7 million children were eligible for SCHIP under the current state eligibility levels and another 3.7 were eligible but not enrolled in Medicaid. 90% of the eligible but uninsured children were from families with incomes below double the poverty level (something addressed by some of the 2007 bills by increasing outreach programs). There are a total of 9.4 million uninsured children aged 18 and under in the U.S.[1]

Increase in funding required in 2007 to maintain current levels of enrollment

When the program was first created, it allocated roughly $20 billion over five years ($4 billion a year).[3] By 2007, the program cost $5 billion per year. In order to cover the same number of people, the Congressional Budget Office estimated that the program would need an additional $13.4 billion over the next five years (2008 - 2012), for a total of $38.4 billion.[1]

President Bush's position on renewal

President Bush proposed a $5 billion increase in SCHIP over five years, for a total of $30 billion. That level of funding would require cuts in the number of people covered, though Bush had said he might be willing to go higher.[1]

Secretary of Health and Human Services Mike Leavitt said on September 20, 2007 that "We desire to see SCHIP continue to cover those children who are under 200 percent of the poverty line... We believe that the $5 billion is adequate to do that."[4]

SCHIP funding levels
Funding at 1997 creation
(FY 1998-2002)
Funding as of 2007
(FY 2003-2007)
Funding needed to maintain current levels
(FY 2008-2012)
Funding proposed by President Bush
(FY 2008-2012)
Per year $4 billion (alloted) $5 billion (alloted) $8.35 billion(estimated) $6 billion
Five year total $20 billion (alloted) $25 billion (alloted) $38.4 billion (estimated) $30 billion
5 year increase over 2007 baseline n/a n/a $13.4 billion $5 billion

Federal poverty levels

2007 Federal Poverty Level
Persons in
Family or Household
48 Contiguous
States and D.C.
Alaska Hawaii
1 $10,210 $12,770 $11,750
2 $13,690 $17,120 $15,750
3 $17,170 $21,470 $19,750
4 $20,650 $25,820 $23,750
5 $24,130 $30,170 $27,750
6 $27,610 $34,520 $31,750
7 $31,090 $38,870 $35,750
8 $34,570 $43,220 $39,750
For each additional
person, add
$3,480 $4,350 $4,000
Source: 2007 HHS Poverty Guidelines, Department of Health and Human Services.

2007 reauthorization

Main article: Children's Health Insurance Program Reauthorization Act of 2007

Articles and resources

Related SourceWatch articles


  1. 1.0 1.1 1.2 1.3 1.4 1.5 "State Children's Health Insurance Program (SCHIP): An Overview," Washington Post, October 17, 2007.
  2. 2.0 2.1 2.2 "Frequently Asked Questions... SCHIP" (pdf), National Conference of State Legislators, February 2007. Can be accessed through the NCSL homepage on SCHIP.
  3. "SCHIP," National Conference of State Legislatures.
  4. Christopher Lee, "Senate and House Reach Accord on Health Insurance for Children," Washington Post, September 22, 2007.

External resources

External articles

Wikipedia also has an article on State Children's Health Insurance Program (SCHIP) (U.S.). This article may use content from the Wikipedia article under the terms of the GFDL.