Alabama Department of Public Health seeks additional $15 million for kids' health insurance

The Alabama Department of Public Health (ADPH) will seek a $17 million increase in its fiscal year 2027 budget, a jump of about 9.5% over its current budget. 

State Health Officer Dr. Scott Harris, the director of ADPH, said about $15 million of the increase would go to the state’s share of the federal Children’s Health Insurance Program (CHIP). The other $1.7 million will go to employee raises and retirement contributions, health insurance, and supplies.

“Our agency, our CHIP folks work for a long time with an actuarial firm, they basically just have the formula that looks at what our utilization was last year, and our expected enrollment is, what inflation is and what health care costs are,” Harris said. “That’s how we came up with this number. It’s typically pretty accurate.”

CHIP is a federal program for children under 19 that do not qualify for Medicaid coverage and cannot afford private health insurance. Families making up to 300% of the poverty level — about $80,000 a year for a family of three — qualify for the program. The FY26 budget, which passed this spring, included $85.5 million for CHIP, about 20% of the total cost of the program. Harris estimated that would grow to $100.6 million for FY27. The federal government pays for the other 80%. 

Nearly 200,000 Alabama children combined are enrolled in CHIP and ALLKids, a low-cost health insurance for low-income families.

Harris said in an interview Friday that Alabama is the only state that funds CHIP through its public health department. 

“These are for working families, this is not a giveaway program,” Harris said Wednesday.

Harris also said that the department is in a period of uncertainty with the new administration, which he said is normal. Federal funding for ADPH will end on Sept. 30 if Congress does not pass a budget or continuing resolution.

“I think we’ll have a good picture in October, but we just don’t know,” Harris said. 

ADPH gets 66% of its funding from federal sources, Harris said. Its General Fund and Education Trust Fund allotments, making up less than 15% of the budget, mostly go to pay for CHIP. 

Harris also praised part of the Trump-backed budget bill, known as the One Big Beautiful Bill Act (OBBBA), that will award individual states up to $200 million over five years for rural health care. The definition of rural health care is yet to be known, but Harris said that would come with the grant application in mid-September.

“I think we would certainly, as a really rural state with a lot of health care needs, I would think we would have a good chance at getting most of that,” Harris said.

The governor’s office is responsible for applying for the grant, he said, and ADPH has been in contact with them in preparing for the application.

Rep. Chris Sells, R-Greenville, who has three rural hospitals in his district, said they are vital to the state.

“If these rural hospitals close, it doesn’t matter if you live in a rural area or you live on Lake Martin. You’re going to be affected,” Sells said.

Harris echoed that in an interview after the meeting Wednesday. 

“Traumas in our state – heart attacks, strokes – they all end up in just four or five cities in our state,” he said. “That’s just not really sustainable.”

Rep. A.J. McCampbell, D-Linden, asked Harris what he would do with his budget if he had no limitations. Harris said he would want to focus on preventative health care and creating a sustainable model for hospitals to run.

“There’s a lot of factors that can predict that that really don’t have anything to do with care,” Harris said of health trajectories. “The zip code you’re born in, how much money you make, how far you got in school. Those are powerful predictors of how long you live and what diseases you’re at risk for.”

McCampbell emphasized the importance of taking care of children while they are young.

“It’s the parents that we really have to start education about how important it is for the health of their children,” McCampbell said.