Wonky Word: Healthy Montana Kids & CHIP

May 12, 2017

By MBPC Staff

This week is Children’s Mental Health Week and today is National School Nurse Day. So we thought today would be a great day to recap CHIP and the Healthy Montana Kids (HMK) for our wonky words this week.

In 1997, the federal government established the Children’s Health Insurance Program (CHIP). The program was designed to cover uninsured children in families with incomes that are modest but too high to qualify for Medicaid. CHIP provides health coverage to eligible children, through both Medicaid and separate CHIP programs. It is administered by states and funded jointly by states and the federal government. Since states have flexibility to design their own program within Federal guidelines, benefits vary by state. Unfortunately, in the late ‘90s, there was a waiting list for children who were eligible but not enough funding.

Then in 2008, a group submitted a ballot initiative – Healthy Montana Kids I-155 – to the voters. The idea was to expand CHIP by using premium taxes paid by insurance companies to make health insurance available to more children. It raised the ceiling of eligibility to families earning up to 250% of the federal poverty level (FPL) (what is now approximately $51,000 for a family of three) with the goal of covering an additional 30,000 children. The initiative passed in all 56 counties and received 70% of the statewide vote.

Shortly thereafter, the 2009 Montana Legislature enacted the Healthy Montana Kids program. It brings CHIP and Children’s Medicaid under one umbrella with only one application process. Children below 143% of the FPL qualify for Medicaid and children between 143%-261% qualify for CHIP.

What makes HMK so unique – and what makes the Healthy Montana Plan unique – is that it competitively contracts with an insurer to administer healthcare through a private provider network at negotiated rates. This kind of contract is known as a “third party administrator,” or TPA. The TPA for HMK is Blue Cross Blue Shield of Montana and this contract grants access to care through the contractor’s extensive provider network. The contractor processes the claims and issues fee payments to providers on behalf of the state. Montana reimburses the contractor for those claims on a fee-for-service basis.

Healthy Montana Kids covers more than 120,000 children in our state. This means regular check ups, dental care, vision, and help when there is an emergency. The Medicaid Access and CHIP Reauthorization Act (MACRA) extended CHIP funding with no programmatic changes through September 30, 2017. That means legislative action will be required to extend federal funding past September, which is just 4 months away. When we talk about health care, we need to make sure we talk about CHIP reauthorization too. Kids with coverage help keep medical costs down for all of us, and kids with coverage are healthier. Healthier kids mean they do better in school, which will lead to a more educated work force.