Healthcare MoneyBeginner5 min read

CHIP: low-cost health coverage for kids when you earn too much for Medicaid

The Children's Health Insurance Program covers kids in working families with income above the Medicaid line — often for little or nothing, year-round.

There's a coverage program aimed squarely at working families who earn a bit too much for Medicaid but would struggle to buy a child's coverage on the open market: the Children's Health Insurance Program, or CHIP. It quietly insures millions of kids, often for free or a nominal premium, and — like Medicaid — it enrolls year-round. If your children are uninsured because you assumed you make too much for help but too little to comfortably buy a plan, CHIP is the program you're probably missing.

What CHIP covers

CHIP provides comprehensive coverage for children: routine checkups and immunizations, doctor and hospital visits, prescriptions, dental and vision care (required in CHIP, unlike many adult plans), lab work, and emergency services. Many states also cover pregnant people through CHIP. Coverage is designed to be affordable — either free or with modest monthly premiums and small copays, and federal rules cap total family cost-sharing at 5% of income.

Who qualifies

Children in families earning too much for Medicaid but within the CHIP income range — commonly up to around 200–400% of the federal poverty level depending on your state.
Eligibility is based on the child's household income, not whether the parents have coverage — parents on employer plans can still enroll kids in CHIP if they qualify.
Citizenship or eligible immigration status is generally required for the child; rules for immigrant children vary by state (some cover them regardless).
Income limits and program names differ by state — CHIP might be branded as part of your state's Medicaid program or under a separate name entirely.

Higher income limits than adult Medicaid

CHIP exists precisely to catch families above the Medicaid line. A household earning $60,000–$90,000 that assumes it makes 'too much for government help' often finds its children qualify for CHIP — the child limits are far more generous than the adult ones.

The in-between family

A family of four earns $70,000 — too much for Medicaid in their state, and a marketplace child-only plan would run a few hundred dollars a month with a real deductible. They apply and find both kids qualify for CHIP at $0 premium with $5 copays and full dental and vision. Annual savings versus the marketplace route: easily $3,000–$5,000, plus richer pediatric benefits, for one application they almost didn't submit.

How to apply

1
Apply through one door
Submit an application at HealthCare.gov or your state exchange, or directly at your state Medicaid/CHIP agency. The application screens for Medicaid and CHIP together, so you don't have to know which one fits.
2
Apply any time
There's no open-enrollment window for CHIP or Medicaid — apply the moment coverage lapses or your income changes. Coverage often starts quickly.
3
Report the household honestly
Eligibility keys off household size and income; include everyone and use current figures. If you're between jobs, current income may qualify kids you assumed earned too much.
4
Renew on schedule
CHIP requires periodic renewal. Watch for the renewal notice and respond promptly — a missed form is the top reason eligible kids lose coverage.

Don't buy a child-only marketplace plan without checking CHIP first

Child-only marketplace plans are often more expensive and less generous for pediatric dental and vision than CHIP. If your income is anywhere near the range, run the CHIP screening before enrolling kids in a marketplace plan — and remember losing other coverage is a qualifying event if you need to switch mid-year.

The bottom line

CHIP is built for the working family that earns too much for Medicaid and too little to shrug at a child's premium. It's comprehensive, includes dental and vision, costs little to nothing, and enrolls year-round through the same application as Medicaid. If your kids are uninsured or you're paying full freight for their coverage, spend fifteen minutes on the screening — the income limits for children are far higher than most parents guess.

Check your understanding

1 of 3

CHIP is designed primarily for which families?

Not quite — try again.

The Worth letter

Get smarter about money every week

One email, no spam — practical guides and Worth updates. Unsubscribe anytime.

Put this into practice

Worth tracks your accounts, budgets, and goals — so the concepts in this article aren't just theory.

Start free trial