When Alison Schamber switched jobs last fall, she had no idea her new, higher-paying job would end up costing her kids their health insurance. But that extra dollar an hour was enough to have her children--one of whom has cerebral palsy--booted off the Oregon Health Plan.

What the state failed to tell Schamber, and the parents of more than 6,000 other uninsured Oregon children is they are eligible for the Children's Health Insurance Program (CHIP), an alternative health care program for low-income children sponsored by the state and federal government.

In fact, last year, the State of Oregon failed to sign up enough low-income families for the CHIP program to meet minimum requirements set by the federal government. As a result, this year Oregon will lose $18 million in funds. Meanwhile, more than 77,000 children remain without health insurance, a plight that the state's fumbling of funding will only worsen.

"The fact that the CHIP program is available and not being used is a travesty," says Maurge Koch, a registered nurse and teacher at Portland Community College. Many of Koch's nursing students are already struggling to pay for school, rent and childcare. Most, Koch says, have no idea that a program like CHIP is available.

One of the problems with the current system, say critics, is that the Oregon state guidelines are much too stringent. To qualify for the CHIP program, Oregon has set the maximum income at 170 percent of the federal poverty line, much lower than any other state. Moreover, Oregon residents document the value of their assets; if those assets exceed $5,000, they lose insurance privileges.

Members of the Oregon Association of Community Organizations for Reform Now (ACORN) say they are frustrated with the state's failure to provide health insurance for children, and are asking the state to expand and simplify coverage for working families and their children. Although it's too late to save the $18 million, ACORN members say they want to change the system for the future. In addition to easier applications and more outreach, ACORN is asking for higher income limits and an elimination of a waiting period that currently leaves applicants without insurance for six months.