In a new report to Congress, the Government Accountability Office questions whether the flexibility states have in administering their State Children’s Health Insurance Programs undermines the primary goal of covering children not eligible for Medicaid. The GAO also raises the question whether the federal government, in bailing out states that exceed their SCHIP allotments, is turning SCHIP into an entitlement program like Medicaid. In testimony before the House Subcommittee on Health, Committee on Energy and Commerce, the GAO’s director of health care said that 14 states are expected to have shortfalls in SCHIP funding this year and that seven states exceed the eligibility requirement of 200% of the federal poverty level set by most states in offering coverage to individuals. Enrollment in the program, which covered 6 million individuals in 2005, has stabilized, yet 11.7% of children remain uninsured even though many are eligible for SCHIP or Medicaid. SCHIP is up for congressional reauthorization in June.
The GAO asked Congress to consider whether the design of SCHIP, which gives considerable flexibility to states, should allow states to exceed their allotment of funds by covering adults or those with higher household incomes. It posed the question, Because SCHIP is a capped program, does the federal government have a responsibility to allocate additional funds for states that have exceeded their share? And would SCHIP funds be better spent by targeting them to states that have not met minimum coverage levels for children?
