Medicaid and SCHIP Section 1115 Research and Demonstration Waivers

Publication Date: March 2006

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Health

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Abstract:

Section 1115 of the Social Security Act provides the Secretary of Health and Human Services (HHS) with broad authority to conduct research and demonstration projects under several programs authorized by the Social Security Act. Two such programs are Medicaid and the State Children's Health Insurance Program (SCHIP).

Specifically, Section 1115 allows the Secretary to waive certain statutory requirements to modify virtually all aspects of the programs as long as the changes further the goals of Titles XIX (Medicaid) and/or XXI (SCHIP). In recent years, there has been increased interest among states and the federal government in the Section 1115 waiver authority as a means to restructure Medicaid coverage, control costs, and increase state flexibility. States have used the Section 1115 waiver authority to cover nonMedicaid and SCHIP services, limit benefit packages for certain groups, cap program enrollment, among other purposes.

As of fall 2003, there were 68 operational (i.e., approved and implemented) Medicaid and SCHIP Section 1115 waiver programs. In FY2003 (the most recent data available), Section 1115 waiver federal expenditures (for Medicaid and SCHIP) totaled $22.4 billion. Section 1115 waiver programs represented nearly14% of all federal Medicaid spending in the 50 states and the District of Columbia for FY2003 (8% for SCHIP), and provided coverage to approximately 9.5 million enrollees. Of the 9.5 million total Medicaid and SCHIP waiver enrollees, 2.4 million were eligible only for a targeted benefit package such as family planning or pharmacy benefits. This report provides background information on the waiver authority, and will be updated when new data are available.