What is chip and how does it work?

03 Apr.,2024

 

‘Flavors’ of chips

There are two major ways to categorize microchips: by functionality and by type of integrated circuitry. In terms of circuitry, a chip can be analog, digital, or mixed. The difference between analog and digital function has to do with the electric signals they process. In digital chips, the signals are binary. In analog chips, the signals are continuous, meaning they can take on any value within a given range, and they use more traditional circuit elements (resistors, capacitors and occasionally inductors).

 

In terms of functionality, there are four main categories: Logic chips, Memory chips, application-specific integrated chips (ASICs) and system-on-a-chip devices (SoCs). The two most common types of chips, Logic chips and Memory chips, are digital: they manipulate and store bits and bytes using transistors. ASICs and SoCs are mainly a mix of analog and digital.

 

Logic chips are the ‘brains’ of electronic devices – they process information to complete a task. Among Logic chips, CPUs (central processing units) are the ‘original’ chips, first designed in the 1960s. But there are also processors with specific functionality in mind, such as GPUs (graphical processing units, which are optimized for visual display) and NPUs (neural processing units, designed for deep and machine learning applications).


Memory chips store information. There are two types of Memory: volatile and non-volatile. Volatile Memory chips, such as DRAM (Dynamic Random Access Memory), are the ‘working memory’ chips that save data only while the device’s power is turned on. Non-volatile Memory chips such as NAND Flash save data even after the device is turned off. For example, DRAM helps to run programs on your device, whereas NAND stores your photos. Whereas DRAM is fast, NAND is slow to read and write data.

 

ASICs are simple, single-purpose chips used for performing repetitive processing routines such as scanning a barcode.


SoCs are essentially integrator chips. They are a relatively new type of chip that combines many chips and circuits in a single chip and may integrate things such as graphics, audio, camera, video and Wi-Fi.

The Children's Health Insurance Program (CHIP) provides comprehensive benefits to children. States have flexibility to design their own program within federal guidelines, so benefits vary by state and by the type of CHIP program. States may choose between a Medicaid expansion program, a separate CHIP, or a combination of both types of programs. 

Medicaid Expansion Benefits

Medicaid Expansion CHIP programs provide the same Medicaid benefit package as provided for children under each state’s Medicaid state plan and/or section 1115 demonstration program.  States with a Medicaid Expansion CHIP must provide the Medicaid benefit for children and adolescents known as Early and Periodic Screening, Diagnostic and Treatment services, or the EPSDT benefit.  EPSDT provides a comprehensive array of prevention, diagnostic, and treatment services for low-income infants, children, and adolescents under age 21, as specified in section 1905(r) of the Social Security Act. The EPSDT benefit is designed to assure that children receive early detection and care, so that health problems are averted or diagnosed and treated as early as possible.

Separate CHIP Benefits Options

In a separate CHIP, states can choose to provide benchmark coverage, benchmark-equivalent coverage, or Secretary-approved coverage. 

Benchmark coverage is health benefits coverage that is substantially equal to the health benefits coverage in one of the following benefit plans:

  • Federal Employees Health Benefit Plan. The standard Blue Cross/Blue Shield preferred provider option service benefit plan offered to federal employees.
  • State Employee Plan. A health benefits plan that is offered and generally available to state employees in the state.
  • Health Maintenance Organization (HMO) Plan. A health insurance coverage plan that is offered through an HMO, as defined in the Public Health Service Act, and has the largest insured commercial, non-Medicaid enrollment in the state.

Benchmark-equivalent coverage has an aggregate actuarial value that is at least actuarially equivalent to the coverage under one of the benchmark packages. In addition to the mandatory coverage for all types of CHIP coverage, benchmark-equivalent health benefits coverage must include coverage for the following categories of services:

  • Inpatient and outpatient hospital services
  • Physicians' surgical and medical services
  • Laboratory and X-ray services

There may be additional coverage requirements depending on the specific benchmark package used by the state. 

Secretary-approved coverage is U.S. Health and Human Services Secretary-approved coverage is health benefits coverage that the Secretary determines provides appropriate coverage for the population of targeted low-income children covered under the program. Secretary-approved coverage may include, but is not limited to, coverage that is the same as the coverage provided under the Medicaid state plan.

Mandatory Separate CHIP Benefits

Regardless of the type of separate CHIP coverage a state elects, all states must provide well-baby and well-child care, dental coverage, behavioral health care, and vaccines.

Well-Baby & Well-Child Visits

States must provide well-baby and well-child visits and have the flexibility to determine the periodicity schedule that defines when those visits should occur. Many states use the American Academy of Pediatrics recommended schedule, Bright Futures, while other states elect to use a state-tailored periodicity schedule.

Dental Benefits

Dental coverage in separate CHIP programs must include coverage "necessary to prevent disease and promote oral health, restore oral structures to health and function, and treat emergency conditions," as specified at 2103(a)(5) of the Social Security Act. States with a separate CHIP program may choose from two options for providing dental coverage: a Secretary-approved package of dental benefits that meets the CHIP dental requirements, or a benchmark dental benefit package. The benchmark dental package must be substantially equal to one of the following:

  1. The most popular federal employee dental plan for dependents
  2. The most popular plan selected for dependents in the state’s employee dental plan
  3. Dental coverage offered through the most popular commercial insurer in the state

For more information on children’s oral health care, view our Medicaid Dental Care page and our Dental Coverage in CHIP letter to State Health Officials.  

States are also required to post a listing of all participating Medicaid and CHIP dental providers and benefit packages on InsureKidsNow.gov.

Behavioral Health Benefits

The Mental Health Parity and Addiction Equity Act (MHPAEA, Pub.L. 110-343) makes it easier for Americans with mental health and substance use disorders to get the care they need by prohibiting certain discriminatory practices that limit insurance coverage for behavioral health treatment and services. MHPAEA requires coverage for mental health and substance use disorders to be no more restrictive than the coverage that generally is available for medical/surgical conditions. Federal statutes require Medicaid and CHIP programs to comply with mental health and substance use disorder parity requirements. This requirement applies to:

  • Copays, coinsurance, and out-of-pocket maximums
  • Limitations on services utilization, such as limits on the number of inpatient days or outpatient visits that are covered
  • The use of non-quantitative treatment limitations, such as care management tools, and criteria for medical necessity determinations 

For more information on parity requirements, please view our Parity page.

In addition, effective October 24, 2019, section 5022 of the SUPPORT for Patients and Communities Act amends section 2103(c)(6) of the Social Security Act to require coverage to prevent, diagnose, and treat a broad range of mental health and substance use disorder conditions in a culturally and linguistically appropriate manner. Additional information is available in State Health Official letter # 20-001.

Vaccines

Coverage for age-appropriate vaccines is required in CHIP. States with a separate CHIP program must purchase vaccines for enrolled children using only CHIP federal and state matching funds. This contrasts with vaccines for Medicaid (including Medicaid expansion CHIP) and uninsured children, which are paid for by the Vaccines for Children (VFC) program under section 317 of the Public Health Service Act. VFC funding may not be used to purchase vaccines for children who have separate CHIP coverage.

States have two options for purchasing vaccines for children enrolled in separate CHIP programs:

  1. Purchase vaccines using the Centers for Disease Control and Prevention (CDC) contract and distribution mechanism.
  2. Purchase vaccines through the private sector. 

Find out more about CHIP vaccines and their funding.

The Centers for Medicare & Medicaid Services has worked with the CDC on issuing joint guidance for all states with a separate CHIP program on purchasing and claiming for vaccines administered to separate CHIP children. The guidance letter explains that states that purchase vaccines through the CDC must pay for vaccines at the time they are ordered. States claim federal financial participation against the CHIP allotment based on the purchase invoices rather than individual provider claims. The letter further explains that states will use a reconciliation process to ensure that future vaccine orders are adjusted based on the outstanding credit for unused vaccines from the previous order.

Find out more about the joint guidance letter on these policies. 

What is chip and how does it work?

Benefits