	Introduction

The State Children's Health Insurance Program (CHIP) is a federal-state program that provides health coverage to certain uninsured, low-income children and pregnant women in families that have annual income above Medicaid eligibility levels but do not have health insurance. CHIP is jointly financed by the federal government and the states and is administered by the states. Federal appropriations for CHIP are provided in statute. 115-120 ), and the Bipartisan Budget Act of 2018 (BBA 2018, P.L. This report provides an overview of CHIP financing, beginning with an explanation of the federal matching rate. It describes various aspects of federal CHIP funding, such as the federal appropriation, state allotments, the Child Enrollment Contingency Fund, redistribution funds, and outreach and enrollment grants. The report ends with a section about the recent legislative activity that has resulted in federal funding for CHIP being provided through FY2027. Federal Matching Rate

The federal government's share of CHIP expenditures (including both services and administration) is determined by the enhanced federal medical assistance percentage (E-FMAP) rate. Statutorily, the E-FMAP (or federal matching rate) can range from 65% to 85%. The continuing resolution enacted on January 22, 2018 ( P.L. Most of the federal CHIP expenditures are from state CHIP allotments, which are the federal funds allocated to each state to finance its CHIP program. FY2018 began on October 1, 2017, without federal CHIP funding having been appropriated for the fiscal year. Then, February 9, 2018, BBA 2018 provided appropriations for FY2024 through FY2027. These sources include the Child Enrollment Contingency Fund, redistribution funds, and Medicaid funds. The full-year FY2018 appropriation for CHIP was not provided until January 22, 2018, when CHIP was provided appropriations for FY2018 through FY2023. 115-120 extends the increase to the E-FMAP rate by one year (i.e., through FY2020), but the increase is to be 11.5 percentage points rather than 23 percentage points (i.e., the increase for FY2016 through FY2019).
The State Children's Health Insurance Program (CHIP) is a means-tested program that provides health coverage to targeted low-income children and pregnant women in families that have annual income above Medicaid eligibility levels but have no health insurance. CHIP is jointly financed by the federal government and the states, and the states are responsible for administering CHIP.
The federal government's share of CHIP expenditures (including both services and administration) is determined by the enhanced federal medical assistance percentage (E-FMAP) rate. The E-FMAP varies by state; statutorily, the E-FMAP can range from 65% to 85%. The E-FMAP is increased by 23 percentage points for FY2016 through FY2019 and by 11.5 percentage points for FY2020. In FY2021, the E-FMAP is to return to the regular E-FMAP rates.
The federal appropriation for CHIP is provided in statute. From this federal appropriation, states receive CHIP allotments, which are the federal funds allocated to each state and the territories for the federal share of their CHIP expenditures. In addition, if a state has a shortfall in federal CHIP funding, there are a few sources of shortfall funding, such as the Child Enrollment Contingency Fund, redistribution funds, and Medicaid funds.
FY2018 began on October 1, 2017, without federal CHIP funding having been appropriated for the fiscal year. The full-year FY2018 appropriation for CHIP was not provided until January 22, 2018, when CHIP was provided appropriations for FY2018 through FY2023 through the continuing resolution enacted on January 22, 2018 (P.L. 115-120). Then, on February 9, 2018, the Bipartisan Budget Act of 2018 (BBA 2018; P.L. 115-123) provided CHIP appropriations for FY2024 through FY2027.
This report provides an overview of CHIP financing, beginning with an explanation of the federal matching rate. It describes various aspects of federal CHIP funding, such as the federal appropriation, state allotments, the Child Enrollment Contingency Fund, redistribution funds, and outreach and enrollment grants. The report ends with a section about the recent legislative activity that has resulted in federal funding for CHIP being provided through FY2027.