Overview
The Children's Health Insurance Program (CHIP) is a federal-state program that provides health coverage to children in families with income too high to qualify for Medicaid but too low to afford private health insurance. Created by the Balanced Budget Act of 1997 as the State Children's Health Insurance Program (SCHIP, later renamed CHIP), the program is administered by states with federal matching funds and must meet minimum federal requirements.
Eligibility thresholds vary by state. Federal minimum is Medicaid-eligibility-threshold to 200% of federal poverty level (FPL) in most states, with many states extending coverage to 250–300% FPL or higher. New York and New Jersey extend CHIP eligibility to 400% FPL. Income thresholds apply at the household level; specific dependent status, age (under 19), citizenship/immigration status, and residency requirements also apply.
States have three implementation options: (1) Medicaid expansion CHIP — enroll eligible children in the state's regular Medicaid program with CHIP funding; (2) Separate CHIP program — standalone program distinct from Medicaid with its own benefit structure and provider network; (3) Combination program — mix of both. Each state chooses based on policy priorities, pre-existing Medicaid infrastructure, and administrative preferences. CMS data tracks CHIP enrollment by state implementation type.
For RCM, CHIP billing handling depends on the state's implementation. In Medicaid expansion CHIP states, children enroll in Medicaid plans; billing follows standard Medicaid workflows with the same managed care organizations, fee schedules, and administrative rules. In separate CHIP states, there's often a distinct CHIP program administrator, sometimes a specific MCO network, and potentially different fee schedules or benefit structures. Providers must recognize CHIP as distinct from private plans but operationally similar to Medicaid in most respects.
CHIP covers a broad set of pediatric services: preventive care (ACA-mandated), immunizations, well-child visits, sick care, dental, vision, mental health, emergency services, and inpatient care. Coverage is comprehensive for the pediatric population. Cost-sharing is limited — states can impose modest copays and premiums within federal limits, typically capped at 5% of household income annually.
CHIP enrollment has generally grown since inception, with periodic political uncertainty around federal funding reauthorization. The program was reauthorized through 2029 under subsequent legislation. CMS publishes CHIP enrollment data monthly; approximately 7 million children enrolled as of 2024.
The COVID-19 Public Health Emergency continuous-enrollment provisions kept children enrolled in Medicaid/CHIP without redetermination through March 2023. The "unwinding" of continuous enrollment through 2023–2024 produced substantial coverage disruption as states resumed redetermination and many children lost coverage despite continuing eligibility. Providers encountered increased enrollment-status issues during this period; real-time eligibility verification was especially important to catch coverage-loss events at scheduling.
Industry benchmark
Social Security Act Title XXI. CMS CHIP Annual Report. CMS Medicaid & CHIP Enrollment and Spending Reports.
Worked example
A 12-year-old child in New York family earning 285% FPL. Qualifies for Child Health Plus (NY's CHIP program). Enrolled through Healthfirst managed care. Provider sees patient; bills Healthfirst at contracted rate. Standard pediatric visit allowed $85; $5 copay per visit (NY CHIP modest cost-sharing). Provider collects $5 copay at POS; Healthfirst pays $80. Annual well-child visits, immunizations, dental, vision all covered. Patient's Medicaid and CHIP experience operationally indistinguishable.
Frequently asked questions — Children's Health Insurance Program (CHIP)
Who qualifies for CHIP?
Children under 19 in families with income too high for Medicaid but generally below 200–400% FPL (varies by state). Specific citizenship/immigration status, residency, and dependency requirements apply. Each state's exact eligibility thresholds and rules differ; verify current state-specific eligibility for each enrolled child.
How does CHIP differ from Medicaid?
Medicaid is the underlying program for low-income beneficiaries of all ages. CHIP specifically covers children whose family income exceeds Medicaid thresholds but falls below private-coverage affordability. Some states implement CHIP through Medicaid expansion (operationally identical), others through separate programs (different MCOs, benefit structures).
Is CHIP managed care?
In most states, yes. CHIP is delivered through MCOs in most states, similar to Medicaid managed care. A few states use fee-for-service or mixed models. MCO rosters, fee schedules, and administrative rules match or closely parallel the state's Medicaid managed care structure.
What happens to CHIP at age 19?
Coverage ends at the state's upper age limit (typically 19). Young adults often transition to family coverage, marketplace plans, or (if eligible) Medicaid. The continuity-of-coverage problem at age 19 is a recognized gap; some states have extended CHIP-like programs for young adults to 21 or 26.
Disclaimer
This glossary entry is operational reference for revenue-cycle and medical-billing professionals. It is not legal, clinical, or contractual advice. Industry benchmarks cite named public sources where available; always verify against the current guidance from the authority body before relying on a number in a contract, policy, or compliance filing.