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BILL # HB 2127 |
TITLE: children's health insurance program |
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SPONSOR: Cobb |
STATUS: House Engrossed |
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PREPARED BY: Patrick Moran |
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The bill would modify the requirement that AHCCCS freeze enrollment in the KidsCare program if the federal match rate falls below 100%. AHCCCS would be required to notify the Legislature and the Governor if the agency determines that appropriated monies are insufficient for the program. After consulting with the Governor, AHCCCS would be required to freeze program enrollment until the agency verifies that funding is available to continue processing new applications.
If all federal funding is eliminated, AHCCCS would be required to freeze enrollment and terminate the program in 30 days.
Estimated Impact
The fiscal impact of the bill will depend on the circumstances surrounding its implementation. The federal match is scheduled to drop below 100% in October 2019, which would otherwise trigger a freeze in program enrollment.
If AHCCCS has sufficient surplus General Fund monies, the bill would permit them to continue enrollment with no freeze. We estimate that AHCCCS would have to use $5.1 million of their surplus monies in FY 2020 and $13.5 million in FY 2021 to pay the state match. These surplus monies would otherwise revert to the General Fund.
If AHCCCS does not have sufficient surplus General Fund monies, the bill would require AHCCCS’ consultation with the Legislature and Governor. After this consultation, AHCCCS is to freeze enrollment until they can verify an available fund source. HB 2127 would not give them the authority to pay the higher match in the absence of available funds. As a result, the Legislature would need to approve subsequent legislation to provide that funding.
The KidsCare program provides health coverage for approximately 25,000 children in families with incomes from 133% to 200% of the Federal Poverty Level (FPL). The program is funded by the federal Children's Health Insurance Program (CHIP) block grant and state monies appropriated to the program. The CHIP block grant also funds federally mandatory Medicaid coverage for 72,000 children ages 6-18 in families with incomes from 100% to 133% FPL (also known as the "Child Expansion" population). Arizona's current match rate for CHIP is 100%. Because the match rate is 100%, there are no state monies currently appropriated to the KidsCare program or the Child Expansion population.
Statute requires AHCCCS to freeze KidsCare enrollment if the federal match rate drops below 100%. Federal legislation adopted in January 2018 funds CHIP through 2023, but the federal match rate in Arizona is scheduled to drop to 90.4% in October 2019 and 78.9% in October 2020. As a result, under current law, AHCCCS would be required to freeze enrollment in the KidsCare program in October 2019.
To the extent that the bill would avert a freeze in the KidsCare program, the costs of the program would increase. In the absence of an enrollment freeze, we estimate that the reduction in federal match rates would generate state costs for the
KidsCare program of $5.1 million in FY 2020 and $13.5 million in FY 2021.
(Continued)
Local Government Impact
None
2/6/18