Governor proposes funding for KidsCare

Gov. Doug Ducey wants the state to start picking up some of the costs of providing health care for more than 32,000 children of the working poor.

The governor’s budget proposes a repeal of a 2017 law that says the state will stop enrolling children in the KidsCare program once the federal government no longer picks up the entire tab. That is scheduled to occur in September when federal support drops to 90.5 percent.

No child already in would be kicked off.

But as children fall off the program as parents are no longer financially eligible, that law would bar the Arizona Health Care Cost Containment System, which administers it, from enrolling any more. The result, according to the governor’s staff, is that about 6,000 fewer children would be covered this coming budget year, with nearly 26,000 falling off the rolls.

Ducey wants lawmakers to not only repeal the law but also provide $2 million for the coming fiscal year and $9 million after that to make up the difference for what the federal government will no longer fund.

Christina Corieri, the governor’s health policy adviser, said the move makes financial sense.

“If this program isn’t available, we risk those low-income families either dropping out of the workforce all together, or dropping their hours enough that they qualify for AHCCCS,” she said.

That would end up costing more.

First, the federal match for AHCCCS is just 66 percent of the cost. Corieri said that the lowest the federal match will be for KidsCare is 75 percent.

And there’s also the fact that if the family income drops to AHCCCS-eligible levels, then the entire family would be enrolled and not just the children.

“We want to support them in their work,” Corieri said.

Whether state lawmakers go along is another thing.

Last year Rep. Regina Cobb, R-Kingman, attempted a similar repeal of the 2017 law, but with no cash attached. Instead, it would simply have required the director of AHCCCS to inform the Legislature of any financial shortfall in full funding and give lawmakers the option to keep the program in place with state dollars.

The measure cleared the House on a 46-12 margin but got stalled in the Senate Appropriations Committee.

At issue is the federal Children’s Health Insurance Program.

Approved in 1997, it provides low-cost health insurance for children whose parents make too little to afford private insurance, but too much to qualify for AHCCCS, the state’s Medicaid program. There, income eligibility is capped at $28,676 for a family of three, with higher limits for larger families.

Eligibility for CHIP runs $41,560 for a family of three.

Arizona joined the program in 2001, naming it KidsCare, with the feds picking up about three-fourths of the cost.

In 2010, however, state lawmakers decided they could no longer afford that share. They froze new sign-ups, though those already in the program were allowed to stay.

Enrollment dipped from 45,000 to fewer than 1,000.

The state rejoined in 2016 after Congress agreed, as part of the Affordable Care Act, to pick up the entire tab. At last count there were 32,522 children enrolled, with parents paying premiums between $10 and $70 a month.

But the law contains a trigger: If federal dollars drop below 100 percent, new enrollments would again be shut down. It is that law Ducey seeks to repeal, along with the funds to pick up the difference.