As states drop families from Medicaid, children may have another coverage option

Now that a pandemic-era policy that guaranteed Medicaid enrollees wouldn’t be dropped from their coverage has come to an end, affected parents may be worried about how to keep their children insured.

Under the Families First Coronavirus Response Act, states were required to provide continuous Medicaid coverage to enrollees in order to get federal funding. Beginning in April, however, states were able to resume their usual eligibility redetermination process, which could result in as many as 14 million people becoming uninsured, according to the Kaiser Family Foundation. 

“Millions of children are in danger of losing their coverage,” said Caitlin Donovan, a spokesperson for the National Patient Advocate Foundation.

More from Personal Finance:
Mastering this skill is the ‘hardest part’ of personal finance, advisors say
69% of people either failed or barely passed this Social Security quiz
What to know about climbing credit card interest rates

The Children’s Health Insurance Program, ​or CHIP, may be a coverage option for many people under the age of 19. CHIP is a joint federal and state program that offers health insurance to children from households with incomes too high to qualify for Medicaid, but too low to afford private insurance.

Here’s what you need to know.

Parents who lose their Medicaid coverage during the disenrollment period shouldn’t assume that their children no longer qualify either, Donovan said. Kids can be eligible for Medicaid at higher income levels than adults, she explained.

If you receive a notice that your health insurance coverage is ending, try to find out if your child will be kept on the plan.

“Basically, double-check everything,” Donovan said. “These are not family plans.”

If your child is also being dropped from Medicaid, it is then time to see if they qualify for CHIP, experts say.

Income eligibility for CHIP varies by state. In some cases, children can still qualify if their family has a six- figure annual income, said Kosali Simon, professor of health economics at the O’Neill School at Indiana University.

In other words: Don’t assume you earn too much without checking your state rules.

Children in some states may be eligible for CHIP even if their parents receive health insurance from their employer, Simon added.

“It’s easy to find out if your kids qualify for CHIP,” Simon said, recommending families start at HealthCare.gov. Benefits.gov is another helpful resource, she said.

Donovan recommends families search online for their state CHIP program to apply, or that they call 1-800-318-2596.

If you’re dropped from Medicaid, your state should provide you with information on how to appeal the decision, Donovan said. Anyone who loses their appeal for Medicaid coverage can then look for insurance on the public exchange, where a special enrollment period is open through July.

If your child is also no longer eligible for Medicaid, you can apply for CHIP for them at any time, Donovan said. “There’s no special enrollment period for CHIP like there is for other insurance programs,” she said.

The costs of CHIP coverage depends on your state and income, Donovan said. For families with lower incomes, coverage should be free for routine visits, emergencies, prescriptions and dental, she added.

“In some states, parents whose income is higher may be subject to co-pays and premiums for certain services,” Donovan said.

There are a few pitfalls to the coverage parents should be aware of, she said. Some states impose a 90-day waiting period before eligible children can begin receiving coverage. Meanwhile, some children can be locked out of CHIP if their parents fail to pay the premiums on time.