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News Release

FOR IMMEDIATE RELEASE
Wednesday, Jan. 19, 2005

CMS Media Affairs
(202) 690-6145

HHS Reallocates SCHIP Funds, No State Will Fall Short

HHS Secretary Tommy G. Thompson today announced a redistribution of $643 million dollars in unspent State Children's Health Insurance Program (SCHIP) funds to help states avoid funding shortfalls in 2005.

"No child will lose health insurance because states don't have funds to administer a program that is critical to kids who would otherwise not have regular access to health care," Secretary Thompson said.

States have three years to spend each year's SCHIP allotment. In previous years, Congress has allowed a portion of funds left unspent to be redistributed to states that have exhausted their money. This year, Secretary Thompson used his own authority to redistribute unspent 2002 funds to states that demonstrated the need for additional SCHIP funds.

In all, 28 states will be getting supplemental funds under today's announcement. Without the redistribution, five of the states, including Arizona, Minnesota, Mississippi, New Jersey and Rhode Island, would have run out of federal funding for their SCHIP programs.

"I am very pleased that we can take action to prevent any loss or break in coverage because program funds weren't being used by states that need them the most," said Mark McClellan, M.D., Ph.D., administrator of the Centers for Medicare & Medicaid Services, which oversees the SCHIP program. "We intend to do as much as possible to use SCHIP funds to improve access to coverage, and even with this redistribution, we expect to complete the 2005 fiscal year with over $5 billion in unspent federal matching funds."

The redistribution of unspent 2002 funds, including a state chart, is published in today's Federal Register. Funds in the reallocation are available to states as of today.

SCHIP was enacted with bi-partisan support in 1997 as a state/federal partnership program. All states administer a SCHIP program which is intended to provide health coverage to otherwise uninsured children whose families earn too much for traditional Medicaid, but not enough to afford employer-sponsored or private sector policies. Currently, some 5.8 million children are enrolled in SCHIP.

More information about the program can be found at www.cms.hhs.gov/schip.

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Note: All HHS press releases, fact sheets and other press materials are available at http://www.hhs.gov/news.

Last revised: January 19, 2005

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