SCHIP, now known simply as CHIP, stands for the State Children’s Health Insurance Program. It’s a joint federal-state program that provides low-cost health coverage to children in families who earn too much to qualify for Medicaid but not enough to afford private insurance. Congress created the program in 1997 as part of the Balanced Budget Act, at a time when roughly 10 million American children had no health insurance at all. Today, about 7.2 million children are enrolled.
Why the Name Changed From SCHIP to CHIP
The program was originally called SCHIP, with the “S” standing for “State.” When Congress reauthorized it in 2009 through the Children’s Health Insurance Program Reauthorization Act (CHIPRA), the name was officially shortened to CHIP. The program itself didn’t fundamentally change, so you’ll still see both names used interchangeably in older documents and casual conversation.
Who Qualifies for CHIP
CHIP covers children from birth up to age 19. The core idea is simple: if a family’s income is too high for Medicaid but too low for private coverage, their kids can get insurance through CHIP. Each state sets its own income cutoff, expressed as a percentage of the federal poverty level (FPL), and these thresholds vary widely. In some states, families earning up to 200% of the FPL qualify, while others extend eligibility to 300% or higher.
When determining eligibility, states apply a standard 5% income disregard, meaning they subtract an amount equal to 5% of the federal poverty level from a family’s income before comparing it to the cutoff. This small adjustment helps families right on the edge qualify.
What CHIP Covers
States have some flexibility in designing their CHIP benefit packages, but federal law requires every state to cover a core set of services:
- Well-baby and well-child visits: Routine checkups for children at every age, though states decide how frequently these should occur.
- Dental care: Coverage must include services to prevent oral disease, restore dental health, and treat emergencies.
- Behavioral health: Mental health and substance use services for children and adolescents.
- Vaccines: Immunizations required for children.
States that run their CHIP program as a Medicaid expansion (rather than a separate program) must provide the full Early and Periodic Screening, Diagnostic and Treatment benefit. This is a broader package that includes any medically necessary service a child needs, even if the state doesn’t normally cover that service for adults.
How CHIP Differs From Medicaid
Both programs are funded jointly by the federal and state governments, and both are administered at the state level. But they serve different populations and work under different rules.
Medicaid covers a wide range of people: low-income adults, children, pregnant women, elderly adults, and people with disabilities. CHIP is narrower, designed specifically for children whose families fall into that gap between Medicaid eligibility and affordable private coverage. CHIP is also a much smaller program than Medicaid in both enrollment and total spending.
One notable difference is cost sharing. States have more flexibility to charge premiums and copays in CHIP than in Medicaid. For families earning at or below 150% of the FPL, premiums can’t exceed Medicaid limits (which are minimal). For families above 150% of the FPL, total out-of-pocket costs, including premiums and copays, are capped at 5% of family income. This keeps coverage affordable but means CHIP families may pay more than Medicaid families for the same services.
Waiting Periods
To prevent families from dropping private employer coverage just to enroll in CHIP, some states impose a waiting period. This means a child who voluntarily leaves a group health plan must be uninsured for a set number of days before CHIP kicks in. The maximum allowed waiting period is 90 days.
In practice, most states have eliminated waiting periods entirely. As of early 2024, only 9 states still had one. Of those, 7 require 90 days, one requires two months, and one requires just one month. Every state with a waiting period must also offer exemptions for situations like domestic violence, pregnancy, or reaching a lifetime insurance limit. A 2024 federal rule moved to eliminate CHIP waiting periods altogether so that eligible children can access care immediately.
How to Apply
You apply for CHIP through your state’s Medicaid agency, not through a single national portal. Each state runs its own application process, though HealthCare.gov can help point you in the right direction. If you apply for coverage on the federal marketplace and your child appears to qualify for CHIP or Medicaid, your application is typically forwarded to the state agency automatically. You can also contact your state Medicaid office directly to start an application.
Funding and Stability
Unlike Medicaid, which is permanently authorized, CHIP requires periodic reauthorization from Congress. This has caused uncertainty for families at times, as funding has occasionally lapsed during political standoffs. The most recent extension came through the Consolidated Appropriations Act of 2023, which secured federal CHIP funding through the end of fiscal year 2029. Prior to that law, funding was set to expire after fiscal year 2027. The extension provides several more years of stability for the roughly 7.2 million children currently enrolled and the states that administer their coverage.