Capital Beat: Amid CHIP uncertainty, N.H. likely to come out ahead

  • The State House dome as seen on March 5, 2016. (ELIZABETH FRANTZ / Monitor staff) ELIZABETH FRANTZ

Sunday, October 08, 2017

It’s the kind of deadline you don’t usually miss. Late last month, members of Congress blew through the time limit to reauthorize the Children’s Health Insurance Program (CHIP), throwing low-income families and many state budgets into uncertainty.

Federal funding for the block-grant program, which serves 9 million children and was first created in 1997, lapsed on Sept. 29; now, members of Congress are working to restore the funding before some state allotments are projected to run out.

But as representatives of both parties raise alarms – including members of New Hampshire’s all-Democratic delegation – how much would the lapse in funding affect the Granite State?

According to Gov. Chris Sununu, not much. Asked about the future of the program on press call Monday, the Republican governor said New Hampshire lawmakers have already budgeted for this exact event.

“What lapsed was the extended CHIP program,” Sununu said. “New Hampshire had not budgeted for that and planned for it, so the impact of (the failure to reauthorize CHIP) on New Hampshire is very minimal.”

Department of Health and Human Services figures bear that out.

For the state’s fiscal year 2018, which started July 1, New Hampshire set aside $11.8 million for children in the Medicaid/CHIP program out of the program’s $29 million operating budget. Through funding from CHIP and the traditional Medicaid program, the federal government is expected to pay the rest.

The sum took into account the potential lapse in CHIP funding this Oct. 1; once the federal funds run out, New Hampshire will pay according to traditional Medicaid rates – 50-50 – as opposed to the 65-35 federal to state split afforded by the CHIP expansion funds.

The state budget for fiscal year 2019, by contrast, assumes that CHIP is still not renewed. In that year, New Hampshire sets aside the same amount as Washington: $14.5 million each.

That’s a $2.7 million increase from the general fund. But it keeps the program running through 2019, whatever happens in Congress.

DHHS Commissioner Jeffrey Meyers says he’s fielded anxious calls about the program from state lawmakers and Congressional representatives all week. But he stands by the governor’s confidence.

“The services to the kids are not going to be impacted,” Meyers told the Monitor on Friday. “The kids are going to get the services they need. And we’re not going to run out of money because we’ve budgeted sufficient general funds.”

The foresight puts New Hampshire at a unique national advantage. New Hampshire joins Oklahoma as one of only two states whose budgets do not rely on CHIP funding coming through from Washington, according to the Kaiser Family Foundation, a nonprofit health care research organization.

And now, with the program’s future up in the air, states whose budgets did rely on the funding may be facing shortfalls in a matter of months, the foundation said.

Sununu noted the distinction. “I think other states could be in a tougher position, but we’ve planned ahead,” he said.

And if CHIP does get re-approved? That would potentially mean extra funding heading to the state’s Medicaid program, Meyers said.

But while the New Hampshire program is safe at least until the next budget negotiations in 2019, some are still urging caution. At a press conference Friday, Sen. Maggie Hassan and Rep. Ann Kuster, both Democrats, said that the lapse of CHIP, if made permanent, would spell problems down the road for New Hampshire.

“Some states are better prepared to weather this uncertainty than others, but at a certain point, the damage will kick in,” Hassan said. “The bigger story and picture here is that we have an administration ... who are doing a lot of things to undermine health care overall.”

Tricia Brooks, who served as executive director of New Hampshire’s CHIP program from its inception in 1997 to 2008, said New Hampshire’s present 50-50 arrangement could theoretically be reauthorized by the Legislature for as long as Medicaid stays stable.

“Technically, if the state is prepared to continue helping those states under a 50-50 match, there’s no risk to coverage,” she said.

But she raised another hypothetical challenge: a change to the income eligibility level. With the federal CHIP program officially discontinued, New Hampshire is no longer required to keep its programs open for the same income levels – a provision of the Affordable Care Act called “maintenance of effort.”

That means state lawmakers could drop the present eligibility level – children in households making less than 318 percent of the federal poverty level – down to 185 percent. It might not be politically palatable at first, Brooks said, but if other states began doing it out of financial necessity, New Hampshire might take notice.

But Meyers dismissed the possibility.

“That would be permissible, but the Legislature has taken no step to change the eligibility group at all in New Hampshire,” he said.

Regardless, whether lawmakers back the $14.5 million appropriation into the future – and whether the appropriation will meet demand – is a question for 2019.

For now, all eyes are turned to Washington.

(Ethan DeWitt can be reached at edewitt@cmonitor.com, or on Twitter at @edewittNH.)