HIstory

• The Children's Health Insurance Program (CHIP) was originally created as part of the Balanced Budget Act of 1997. Together with Medicaid, CHIP was credited with having reduced the number of uninsured children and improving access to health care for millions of low-income families. However, 9 million children were still uninsured as of 2009, even though two-thirds of them were eligible for CHIP or Medicaid under existing law. Also, the original CHIP law was set to expire in April, 2009.
  
  

Increasing Enrollment

• To address the problem of low enrollment, the new CHIPRA law institutes a bonus system that rewards states for increasing their CHIP enrollment beyond a set target. It also provides tools and incentives for states to streamline their enrollment processes, so that children already eligible for Medicaid or CHIP can be accepted into the program without delay. In addition, the new law provides extra federal funds for outreach, to educate parents and the general public about available benefits.
  
  

Funding

• CHIPRA increases federal funding of the CHIP program by $33 billion, with provisions to ensure that the money only goes to states that spend it on children's health. The increase in funding is paid for largely by a 62-cent hike in taxes on cigarettes. As a further incentive to include more children, the new law makes available a contingency fund in case states spend over-budget because of increased enrollment. Under CHIPRA, states continue to have the flexibility to extend coverage to moderate-income children, but federal matching funds will be reduced to Medicaid level for children who fall 300 percent above of the federal poverty line.
  
  

New Rules

• The new rules under CHIPRA make health insurance benefits immediately available to children of legal immigrants, scrapping the five-year waiting period that was previously mandated. However, undocumented children are not eligible for the program. The new law requires parents to provide documentation of their children's citizenship or residency status, similar to the existing rules for Medicaid. Also, while the old rules allowed states to use some CHIP funds in family-based coverage for adults, CHIPRA eliminates that practice, except in the case of pregnant women. CHIPRA explicitly provides states a statutory option for covering mothers-to-be.
  
  

Quality of Care

• In addition to increased funding and expanded enrollment, a significant portion of the new law is devoted to improving the quality of heath care for all children, including those already covered by private insurance. For the first time, states are required to provide dental services to children receiving federally funded health insurance. As well, CHIPRA provides for quality measures specifically geared toward children's health, initiates demonstration projects, and creates a new model of electronic record-keeping.