Congress plugs $650 million SCHIP funding gap

The money is expected to secure 14 programs facing deficits this year.

By Doug Trapp, AMNews staff. June 18, 2007.

Washington -- State Children's Health Insurance Programs will receive $650 million in federal funds to fill budget shortfalls this year thanks to a bill signed into law May 25.

The money was part of a $120 billion military spending bill. The funding will be divided among 14 states that were expecting to run out of SCHIP money before Sept. 30, the end of fiscal year 2007.

The total SCHIP shortfall was estimated at more than $700 million earlier this year, with the first states running out of SCHIP funds in early May. However, $650 million should be enough to fund all of the programs, said Martha Roherty, director of the National Assn. of State Medicaid Directors. That should end the possibility of more states freezing enrollment and any state cutting benefits.

Pediatricians and state Medicaid officials were thankful for the action but were already looking ahead to the looming debate on SCHIP reauthorization. The program is a decade-old state and federally funded initiative for children in families too poor to buy private health insurance but making too much to qualify for Medicaid. It covers 6 million people, including about 600,000 adults, and expires Sept. 30.

States were still waiting to hear how large their share of the $650 million would be. A few states needed a significant portion of the money. For example, the Georgia, New Jersey and Illinois programs needed about $360 million combined to finish fiscal 2007.