CBO Says: Half of States Likely to Eliminate CHIP if MoE is Repealed

On the eve of today's mark up in the House Energy and Commerce Subcommittee on Health, CBO released a more detailed cost estimate of H.R. 1683, the bill to repeal the Medicaid and CHIP stability protections (aka, "maintenace-of-effort requirements").  It highlights that the debate over the future of the stability protections is very much about our children - repealing the protections could decimate CHIP and potentially lead to an unraveling of the nation's record-breaking success in covering kids.  Here is what CBO specifically says about the estimated impact of repealing the stability protections on kids.

• In the next few years, up to 400,000 people a year will lose Medicaid or CHIP coverage, mostly because states will set up new administrative barriers to enrollment.  Two out of three of those losing coverage will be kids.
• As we head into broader implementation of health reform in 2014 and beyond, CBO finds that H.R. 1683 will have an increasingly harsh impact on CHIP.  By 2016, half of states will entirely eliminate their CHIP programs and the remaining states will scale back coverage for children, according to the CBO report.
• By 2016, 1.7 million children lose CHIP.  Of these kids, 300,000 will become uninsured, while 700,000 will go into exchange coverage and 700,000 into employer-based insurance.  The coverage that children receive will not necessarily be even close to as good as CHIP.  As CBO says, families "would be required to pay a larger share of the cost for insurance through exchanges as compared to CHIP."

At a time when those pushing for deficit reduction routinely cite the future of our children as the reason why we need to act, this new CBO analysis highlights that there are much better ways to come up with savings than cutting our investments in the health of future generations.  (Overall, CBO estimates that the repeal of the stability protections generates a relatively paltry $2.1 billion in federal savings, but as we've discussed earlier, this masks the outsize impact on federal CHIP outlays.)  Rescinding the stability protections will mean many states end or slash their CHIP programs.  Millions of children in middle-income and working families will lose a trustworthy, proven source of coverage that allows them to see a doctor when they get sick.  Many would be left uninsured with no other good options for coverage.  There is simply no credible way to argue that this is good for the future of our children.