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The CHIP program is newer than the Medicaid program.

Popularity of the Programs

The answer to the question What is the difference between the Medicaid program and CHIP? is that Medicaid can cover both adults and children while CHIP just covers children here in America. The fact of the matter is that the CHIP program is a far more feasible system from a political perspective due to the fact that people tend to show more concern for poor children than they do poor adults who are still caught up within the welfare state. So the realities of the political feasibility may be another answer to the question of What is the difference between the Medicaid program and CHIP? People always want to cut political ads saying they fought to strengthen legislation which aided sick children. Congress almost always tends to focus more on CHIP than they do the Medicaid system, this could be due to the fact that the larger entitlement programs can cause a fiscal train wreck.

The Amount of Fraud

The amount of fraud involved in the Children's Health Insurance Program appears to be more prevalent according to studies done by the Congressional Budget Office. The Congressional Budget office and other agencies do try and protect against such fraud, but you simply just have a ton of parents move their children into the CHIP program whether or not they have the necessary income to afford private insurance. The Medicaid program tends to be a little bit better policed due to the Medicaid enterprise systems that they have in the different states to police the fraud cases.

Funding Mechanisms

In order to fund Medicaid, you tend to have to occasionally raise a large number of taxes. With the CHIP program, the first tax that all of the states and the federal government tend to want to go after is the cigarette tax. This is due to the fact that the smoke is not even a favorite political ally of those who believe in smaller government.