The Failure of SCHIP Reauthorization:What Next?

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Timely Analysis of Immediate Health Policy Issues series

Summary

As efforts to reauthorize the State Children's Health Insurance Program (SCHIP) failed in 2007, Congress settled on a short-term extension of the program.The issues that proved contentious in the SCHIP reauthorization debate—namely, the proper role of the government in health care, whether SCHIP should cover higher-income children, how to ensure that undocumented children will not be covered, and how the program should be funded—will likely be revisited when Congress again takes on SCHIP reauthorization later in 2008 or early in 2009, when the extension is set to expire. Instead of seeing the reductions in uninsurance among children that were projected under the vetoed SCHIP reauthorization bills, the number of uninsured children will likely increase, at least in the short run. Without strong growth in public coverage, more children are apt to join the ranks of the uninsured, which increased by 1 million over the past two years.

Introduction

After two presidential vetoes of legislation aimed at reauthorizing SCHIP for five years, the president and Congress ultimately agreed to an 18- month extension of the program in December 2007 (S.2499).While the extension did not make any changes in policy, it did include additional funding designed to address anticipated shortfalls across states.^{1, 2} SCHIP was established over a decade ago in 1997 to provide health insurance coverage for children in families whose incomes were too high to qualify for coverage under Medicaid, but who lacked access to affordable private health insurance coverage.³ Though an optional program, all states expanded coverage under SCHIP, with an estimated 6.7 million children and 700,000 adults having coverage under SCHIP at some point during 2006.⁴ State programs vary in terms of their structure and characteristics (e.g., cost sharing arrangements and income eligibility levels), reflecting the flexibility over program design that was built into the SCHIP statute.

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