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A federally-funded program that provides health insurance for thousands of children in Mississippi continues to be in jeopardy. At press time, state officials had no word about the future of the Children's Health Insurance Program (CHIP), which projects a shortfall of up to $15 million in federal funds when the state's fiscal year ends on June 30.

Gov. Haley Barbour and the Mississippi Division of Medicaid are protesting the program's funding formula. They are asking the federal government to change the system and in the meantime provide enough funding to cover the basic program.

"More than 60,000 Mississippi kids rely on CHIP for their health insurance. Due to a fundamentally flawed federal formula which punishes the states that provide health insurance to more low-income kids, Mississippi does not receive enough federal funding to pay for this program," Barbour said. "In recent years, the federal government has redistributed funds to cover this shortfall, but there is a widespread concern this year among states that the shortfall will not be covered by a similar redistribution."

The governor did not say why this fear exists, but he is urging Congress and the Bush administration to change the funding formula and give Mississippi enough funding to tide the program over for the next fiscal year. He joined governors from other states that are experiencing a shortfall in sending a letter to congressional leaders and also went to Washington to lobby for the funding change.

Francis Rullan, director of communications for the Division of Medicaid, said Mississippi does not receive enough federal funding to pay for this program.
"The system doesn't spread the funds to those who need it the most. In the past, shortfalls were handled by a redistribution of funds," he said. "The federal government gathered funds from the states that did not use all of their money and redistributed it to states that ran out. We're hoping that will be done again."

Rullan says it's a waiting game to see what the feds will do, and the answer may not come until the new federal fiscal year begins on Oct. 1.

"We don't know when they'll decide," he said. "We're hoping it will be corrected. It's a vital program and we want to keep it fully funded."

For every 17 cents Mississippi allocates toward the program, the federal government gives 83 cents. CHIP allocations are based partially on the number of uninsured children and wages in the state. Children up to age 19, low-income adults with children under age 18 and pregnant women may qualify for the program, which allows deductions from a family's gross income.

"We're trying to move toward preventative healthcare," Rullan said. "We want people to make choices to see doctors before problems become catastrophic, but to do that, they must have insurance."

The 10-year-old program is largely viewed as successful. It provides immunizations, primary care and hospitalization for little or no fee. The program is up for congressional reapproval this year. Under the president's budget, about $5 billion per year would continue to be spent on CHIP and an additional $4.8 billion would be allocated over the next five years.

Although right at 60,000 children are enrolled in the program in Mississippi, Rullan said rising wages and a good economy are causing families to get off the program. "That's how the social welfare system works and it's a good thing to have less people on it," he said.

In spite of that, the program will have a shortfall this year and state leaders are waiting for an answer from Washington. At least 13 other states also fear a shortfall this year.


May 2007

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