Under the State Child Health Insurance Program, states receive funds to purchase health insurance for low-income, uninsured children. Noting that partnering with managed care will be essential if school-based health centers are to receive reimbursement for serving the publicly insured portion of their clientele, this paper examines the relationship between this public insurance program and school-based health centers (SBHCs). The paper first describes the establishment of SBHCs in the early 1970s and their expansion, focusing on the financing mechanisms used. The paper then describes the State Child Health Insurance Program, including the views of federal and state agencies, health plans, and local SBHCs on the challenges of developing contracts, the incentives and disincentives health plans have to contract with SBHCs, and what has accounted for success where relationships are moving forward. Finally, the paper presents case studies on the experiences of Colorado and Connecticut in addressing these evolving issues. (KB)