Eligibility of the CHIP Programme

Eligibility for health benefits under CHIP is available to different groups via different federal authority and mechanisms. These groups have included children, pregnant women, parents and childless adults. Groups may be covered under the CHIP state plan or via special waiver authority.

Children

In general, it  defines a targeted low-income child as one who is under age 19 with no health insurance, and who would not have been eligible for Medicaid under the rules in effect in the state on March 31, 1997. States can set the upper income level for targeted low-income children up to 200% of the federal poverty level (FPL), or 50 percentage points above the applicable pre-CHIP Medicaid income level. However, "(u)nder current statutory and regulatory authority, States are able to effectively expand eligibility of all children under 19 years of age to whatever level they choose." For states seeking CMS approval to expand eligibility, CHIPRA reduces federal CHIP payments for certain higher-income CHIP children. Specifically, the regular Medicaid federal matching rate (FMAP), which is lower than the CHIP enhanced matching rate, will be used for CHIP enrollees whose effective family income exceeds 300% of poverty using the state's policy of excluding "a block of income that is not determined by type of expense or type of income," with an exception for states that already had a federal approval plan (i.e., New Jersey) or that had enacted a state law to submit a plan for federal approval (i.e., New York).

Within these general rules, states may provide assistance to qualifying children in two basic ways. They may cover such children under their Medicaid programs and/or they may create a separate CHIP program for this purpose. (More details on available benefits under each approach are described in the next section.) When states provide Medicaid coverage to targeted low-income children, Medicaid rules typically apply. When states provide coverage to targeted low-income children through separate CHIP programs. In both cases, the federal share of program costs comes from federal CHIP funds (also described in further detail below).

It does not establish an individual entitlement to benefits. Instead, It entitles states with approved state CHIP plans to pre-determined federal allotments based on a distribution formula set in the law (explained further below). Targeted low-income children covered under a CHIP-financed expansion of Medicaid are, however, entitled to the benefits offered under that program as dictated by Medicaid law. No such individual entitlement exists for targeted low-income children covered in separate CHIP programs.

States may cover targeted low-income children by expanding their Medicaid programs in the following ways: (1) by establishing a new optional eligibility group for such children as authorized, and/or (2) by liberalizing the financial rules for any of several existing Medicaid eligibility categories. Many states with Medicaid-expansion CHIP programs chose the latter, opting to cover targeted low-income children under existing Medicaid eligibility pathways, especially Medicaid's poverty-related child groups, rather than by establishing the  optional coverage group. Such a strategy reduces the administrative burden of creating and implementing a new coverage group.

States may also provide coverage to targeted low-income children by creating a separate CHIP program. States define the group of targeted low-income children who may enroll in separate CHIP programs. It allows states to use the following factors in determining eligibility: geography (e.g., sub-state areas or statewide), age (e.g., subgroups under 19), income, resources (assets), residency, disability status (so long as any standard relating to that status does not restrict eligibility), access to or coverage under other health insurance (to establish whether such access/coverage precludes CHIP eligibility), and duration of CHIP eligibility in pa.