MONTGOMERY — Without quick action in Washington, D.C., state officials said they will begin dismantling a program providing health coverage to about 157,000 low- and moderate-income children.

The Children’s Health Insurance Program expired at the end of September without congressional reauthorization.

“It is in the best interest of Alabama for the Children’s Health Insurance Program to be renewed by Congress. Good stewardship has created a reserve in funding, so health care coverage for 160,000 children and youth in Alabama, who benefit from CHIP, will continue at least through February,” Alabama Medicaid Commissioner Stephanie Azar said. “Our hope is that Congress will act long before our reserves are exhausted. Should Congress not renew federal funding for CHIP, the governor, Legislature, Alabama Medicaid, and Alabama Department of Public Health will assess funding for the program.”

CHIP funding pays for health care for two groups of children and teens in Alabama — about 81,100 on a program called All Kids and 75,200 children on Medicaid. But unlike other Medicaid recipients, these children’s care is 100 percent funded with no state contribution.

Children on Medicaid can’t lose their federally mandated coverage, though the state would have to pay for some of it if CHIP funding isn’t continued at its current rate. That’s not the case for higher-income All Kids participants.

“I’d hate to see any kids lose their coverage,” said Rep. Steve Clouse, R-Ozark, chairman of the House General Fund budget committee. “The ones that are on Medicaid, we’d have to figure out something if CHIP goes away.”

Medicaid officials this week said they were trying to calculate how much it would cost the state to continue providing the health care. The state pays a match for every Medicaid enrollee.

Clouse hopes to see bills reauthorizing funding this week or next. A Senate draft continues 100 percent federal funding for two years.

“We’re like everyone else, wondering what is going to be done,” Clouse said.

Lawmakers in the spring reserved $93 million for fiscal 2019, but much of that is spoken for. The 2019 General Fund already will be short $105 million in BP settlement money available in fiscal 2018, and court-ordered changes to the Alabama Department of Corrections’ mental health services are expected to be costly.

Medicaid serves children up to about 141 percent of the federal poverty line. CHIP serves families with higher incomes, up to about 318 percent of the federal poverty line. The poverty line for a four-person household is $24,600.

About $165 million in CHIP funding was spent on Medicaid recipients last year; $198 million was spent on children in All Kids, according to the Medicaid office.

If Congress doesn’t act soon, said Cathy Caldwell, the state’s CHIP director, the agency will begin the months-long process of dismantling All Kids.

“We have not sent out any notices (to participating families),” Caldwell said. “But I feel certain that in the next month or two we will have to start shutting the program down.”

Part of the process would be to figure out what children currently receiving care through CHIP-funded All Kids would be eligible for Medicaid, Caldwell said.

As of this week, Alabama is still enrolling children in All Kids, she said.

“We’re continuing to operate as normal,” she said. Twitter @DD_MarySell.
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