President Donald Trump wants to cut more than $15 billion worth of previously approved spending. About half of that money would come from the Children’s Health Insurance Program (CHIP).
Trump is also looking to cut about $800 million from an Affordable Care Act (ACA) program that tests innovative payment service delivery models.
- The president signed the Bipartisan Budget Act spending package in February to avoid a government shutdown. However, he complained about the size of the spending package and warned he would not sign a similar bill in the future.
Congress included the CHIP reauthorization as part of the two-year budget deal to avert a shutdown. This came after months of debate, discussions and fears about whether Congress would reauthorize the program for low-income children and families.
Now, three months later, the president wants to roll back spending. He’s targeting more than 30 programs for cuts, but healthcare program reductions make up about half of the request. If the White House follows through with the proposed cuts, Congress will need to review and vote on the plan within 45 days.
CMS estimated that CHIP provided coverage to nearly 9 million children in 2016. The Kaiser Family Foundation said the program has sharply decreased the number of uninsured children.
In a new blog post, Joan Alker, executive director of the Georgetown University Health Policy Institute’s Center for Children and Families, said the rescission plan would call for $2 billion in cuts from the Children Enrollment Contingency Fund. That fund helps states provide CHIP coverage if they run short of money because of higher-than-expected enrollment. This might happen because of a natural disaster or economic downturn. However, only three states have ever needed to tap into the fund, Alker said.
She said the other $5 billion in cuts would come from more general CHIP funding that provides “wiggle room in case state spending is higher than expected.” Alker doesn’t think that cut will immediately affect states, but said it violates a “bipartisan agreement” to provide CHIP funding for low-income children and families.
“Children and states had to wait months for CHIP to be funded, and finally breathed a sigh of relief when Congress moved forward with a long-term CHIP funding extension," she said. "This proposal undermines the bipartisan CHIP agreement and removes reassurances states need that funding will be available to keep kids covered. The administration is going back on that agreement and cutting CHIP funding in order to score political points with their base.”
News about the proposal received swift opposition from Democrats and CHIP advocates.
Let’s be honest about this: @POTUS & the GOP are looking to tear apart CHIP, hurting middle-class families & low-income children, to appease the most conservative special interests & feel better about blowing up the deficit to give the wealthy & biggest corps huge tax breaks.— Chuck Schumer (@SenSchumer) May 7, 2018
Cuts to CHIP could leave states scrambling to decide whether to cut back the programs or potentially take on more costs. This may ultimately trickle down to hospitals and providers and could result in more uninsured children and families, which would lead to more uncompensated care.