Background Paper

No. 64

Shaping Medicaid and SCHIP through Waivers: The Fundamentals
July 22, 2008


Cynthia Shirk, Consultant


The use of waivers has become one of the key vehicles for innovation in Medicaid and the State Children’s Health Insurance Program (SCHIP). This background paper examines the use of research, demonstration, and program waiver authorities to test new approaches to the delivery of and payment for health care and long-term care services. The paper reviews the statutory basis and mechanics of demonstrations and program waivers, as well as their history and political context in shaping Medicaid and SCHIP. It also explores the ways the changing state-federal relationship and the ever-growing demand for state flexibility have driven waiver policy. Finally, the paper examines the impact of the Deficit Reduction Act of 2005 on the need for or desirability of waivers.

Related Materials

See also "Medicaid and SCHIP Waivers" (The Basics, July 30, 2008).

For more information on how the Medicare program uses demonstrations to allow for innovation in its program, see “The Fundamentals of Medicare Demonstrations” (Background Paper 63, July 22, 2008).

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