What Happens if SCHIP Is Not “Reauthorized”?

Source: Chris L. Peterson, Congressional Research Service (CRS) Report for Congress, Order Code RS22712, September 17, 2007

From the summary:
The Balanced Budget Act of 1997 created the State Children’s Health Insurance Program (SCHIP) and provided nearly $40 billion in appropriations over the 10-year period FY1998 to FY2007. Legislative action would be necessary to provide new funds for SCHIP for FY2008 and beyond, but SCHIP’s statutory provisions do not need to be reauthorized as they will remain on the books unless Congress expressly repeals the current law. In the absence of an FY2008 SCHIP allotment, states with unexpended FY2006 and FY2007 federal SCHIP balances could continue to operate their programs with those funds in FY2008. Fourteen states and the District of Columbia are projected to be able to cover all of their federal FY2008 SCHIP spending even without an FY2008 SCHIP allotment. Among the 36 states projected to exhaust their federal SCHIP funds in FY2008, some may be able to access Medicaid funding, though at a reduced matching rate compared to SCHIP. However, 13 states would be in shortfall immediately, entering FY2008 with no prior-year SCHIP balances. An amount equal to approximately 18 days of these states’ federal SCHIP expenditures is projected to be available from the redistribution of unspent FY2005 allotments. This report may be updated in December 2007 with states’ more recent projections.

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