New Jersey filed a civil suit Monday in the U.S. District Court in Newark, N.J., in an effort to preserve states’ ability to enroll moderate-income children in State Children’s Health Insurance Program plans.
The Bush administration had been approving program rule waivers to permit states to use SCHIP funds to cover children in homes with incomes up to 400% of the federal poverty limit as well as homes with incomes closer to the federal poverty limit.
In August, Bush administration officials told states in a letter the government would stop reimbursing them for covering children in families over 250% of the federal poverty level unless the states first showed they had provided coverage for almost all low-income children.
New Jersey officials argue in their complaint, in State of New Jersey vs. U.S. Department of Health and Human Services, that the Bush administration went around the usual public rule-making process when it told them about the 250% federal poverty level income limit.
New Jersey now covers children in homes with incomes up to 350% of the federal poverty level.
The bill that has authorized SCHIP expired Sunday.