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Children's Health Insurance Program


In 1997, an estimated 11 million children in the United States were without health insurance, many living in families whose incomes are too high to qualify for Medicaid, but too low to afford private coverage. The State Children’s Health Insurance Program (SCHIP) was designed to provide health insurance to children who fell in the gap between public and private coverage.

The program was included in an omnibus budget package signed into law by President Bill Clinton on August 5, 1997. Slated to cost $24 billion over five years (1998-2002), it was partially funded by a new 15 cents per pack tax on cigarettes, which was scheduled to be fully phased in by 2002. Funds for the program were turned over to the states, which were tasked with devising their own programs.

The plan's principal backers, Sens. Orrin Hatch (R-UT) and Edward Kennedy (D-MA), hoped that it would provide health insurance to about half of the 10.6 million American children who were then lacking it. The program's actual level of success has been mixed. While nearly 2.5 million children were enrolled in SCHIP programs in the three years after implementation began, millions of children are still uninsured. Some recent studies even indicate that the number of uninsured children has increased to more than 12 million.

 

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