CHIP Policy

602 Cost Sharing Requirements

Effective Date: July 1, 2024

 

Previous Policy

 

Most CHIP clients have cost sharing requirements with some exceptions. Cost sharing includes deductibles, co-payments, and coinsurance.  The amount the client is required to pay is determined by which CHIP benefit plan they qualify for (600).

1. Quarterly Premiums

There is no quarterly premium.

2. Co-Payments, Coinsurance and Deductibles

Most CHIP clients are required to pay co-payments, coinsurance and deductibles for medical and dental services. Copayments, coinsurance and deductibles are types of cost sharing fees the client is required to pay for services covered by their health plan. 

• A copayment is a fixed amount the client is required to pay for covered health care services and can vary by the type of covered services. The amount of the co-payment depends on which plan the client qualifies for (600).  
• Coinsurance is a percentage of the allowed amount that the member is required to pay (usually after the deductible for covered health care services). The percentage will vary by the plan and type of covered service.
• A deductible is the amount the client is required to pay for covered health services before the health plan begins to pay.
• Clients can view co-payment information and the types of services that require a co-payment at: www.health.utah.gov/chip/resourcematerials.htm.

3. Out-of-Pocket Maximums

Individuals enrolled in CHIP are not required to pay more than 5% of the household’s countable income for out-of-pocket expenses during the certification period with the exception of State CHIP (see table I-B for State CHIP). The maximum amount is per family, not per child. DHHS’s payment system keeps track of the member’s incurred expenses including their out-of-pocket maximum for each certification period.

1. If a 5% disregard was applied in the calculation of countable income, the amount of income before applying 5% disregard is the income used in determining the out-of-pocket maximum.

2. The eligibility system will calculate the maximum out of pocket amount for co-payments and deductibles the client will be required to pay for the certification period. The CHIP approval and renewal notices will include the maximum out of pocket amount. To determine their out-of-pocket maximum, take the total annual income and multiply that by .05.

Example:   If the client’s annual countable income is $25,800.

 $25,800 times .05 = $1,290, this means that $1,290 is the family’s maximum out of pocket amount for the entire certification period.

3. Once the household has met their annual co-pay and deductible maximum, they no longer have to pay co-pays, coinsurance, or deductibles for that benefit period.

• If the Out-of-Pocket Maximum has been met and a due process month is issued, the co-pay, coinsurance, and deductible exemptions are extended in the due process month(s).

4. Cost Sharing Exemptions

1. Verified American Indian/Alaska Native individuals are not required to pay co-payments, deductibles, or coinsurance.  The tribe must be recognized by the Federal government. The definition of who is an American Indian/Alaska Native is defined by the tribe.

• See Table VI for acceptable verification of American Indian/Alaska Native Status and how to verify if the tribe is recognized by the United States Bureau of Indian Affairs.
  1. Applicants:  Allow CHIP coverage with the cost sharing exemption when an individual declares to be an American Indian/Alaska Native, and there is no evidence that contradicts their claim.

• Give the client reasonable time to provide documentation of their status.  "Reasonable time" is at least 30 days.  A client may request more time if needed.
• If the client has been given reasonable time and does not provide the documentation or proof that they are working on obtaining it, remove the exemption with proper 10- day notice.

2. Recipients:  Request proof of American Indian/Alaska Native status at review if their status was self-declared at application and tribal verification has not yet been provided.  
   • • Give the client reasonable time to provide documentation of their status. “Reasonable time” is at least 30 days.  A client may request more time if needed.
     • If the client fails to provide the verification or proof that they are working on obtaining it, remove the exemption with proper 10-day notice.

3. If verification of a person's American Indian/Alaska Native status is received at any time, allow the exemption starting the month verification is received.