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Issue Brief
October 2009

What’s Next for CHIP-Funded Adult Coverage?

While the Children’s Health Insurance Program (CHIP) was designed primarily to serve children, federal laws passed in 2000 and 2001 allowed states with leftover CHIP funds to use those funds to cover low-income, uninsured adults who do not qualify for Medicaid. Several states now rely on CHIP funds to cover adults. 

In 2009, President Obama signed the Children’s Health Insurance Program Reauthorization Act (CHIPRA) into law. This law renewed CHIP through the end of 2013 and expanded its scope. But during the CHIP reauthorization debate in Congress, some members questioned whether states should be allowed to continue using their CHIP funds to cover adults. CHIPRA includes a compromise on this issue: Additional states are not allowed to use CHIP funds to cover adults, but states that do are not required to terminate that coverage completely. Instead, CHIPRA changes how that coverage will be financed over the next five years. 

This brief explores: 

  • why states have used CHIP funds to cover adults
  • how states can continue their existing parent coverage—with some important changes under CHPRA
  • how states can cover other adults through CHIP
  • why states can and should continue to cover adults