Thursday, January 11, 2018

New projection says reauthorizing CHIP will save money in the long run; lawmakers say they're close to a deal

A new projection from the Congressional Budget Office says that reauthorizing the Children's Health Insurance Program for 10 years would save the government $6 billion. CBO says a five-year extension would cost the government $800 million, down from earlier estimates of $8 billion.

CHIP provides insurance to 9 million children whose parents make too much to qualify for Medicaid but can't afford private insurance. The CBO's projection is anchored on the repeal of the Patient Protection and Affordable Care Act's individual mandate in the recently passed tax overhaul.

"To summarize the CBO’s complicated line of reasoning that led to this outcome, no mandate means fewer people will enroll in the Obamacare marketplaces, meaning fewer low-income folks will get federal subsidies," Paige Cunningham reports for The Washington Post. "Some of those people leaving the marketplaces would instead enroll their kids in CHIP. And on the federal government’s end, paying for CHIP coverage is actually cheaper overall than funding subsidies for private marketplace plans. So the government, the argument goes, would actually save money on CHIP in the future."

With such a projection, Cunningham writes that it would be "truly shocking" if Congress doesn't renew CHIP soon. Lawmakers in both parties say they've almost resolved the disagreement and could reauthorize the popular, bipartisan law as soon as next week. The measure could be attached to a short-term government funding bill that must pass before Jan. 19, Peter Sullivan reports for The Hill.

House Energy Committee Chairman Greg Walden (R-Ore.) told reporters he didn't think paying for the five-year extension would be a problem, but said whether CHIP is added to the spending bill next week is up to the leaders who are negotiating what goes in it, Sullivan reports.

The deal will come not a moment too soon. The Centers for Medicare and Medicaid Services said the stopgap funding already provided to CHIP may not last through the end of March, Cunningham reports. Several states, such as Virginia and Alabama, have sent letters to parents warning them that the program will end soon unless Congress funds it.

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