News Briefs: Archives 2011 & Earlier

No CHIPs Off the Uninsured Kids Block

Several new reports on changes in public and private health insurance have put a frown on the faces of those striving to increase the number of children covered through expanding public programs for low-income children or through private health insurance.

“Recent Trends in Children’s Health Insurance Coverage: No Gains for Low-Income Children,” released in late April by the D.C.-based Center for the Study of Health System Change (HSC), compares the years preceding and following the implementation in 33 states of the State Child Health Insurance Program (SCHIP). The result: no growth in the insurance rate for low-income children (those with income less than 200 percent of the poverty level), along with a decrease in the rate of insurance for low-income parents. The center is a research organization funded by the Robert Wood Johnson Foundation.

Since Congress passed CHIP in 1997, the percentage of low-income children who were uninsured grew from 19 percent to 20 percent, because even as public coverage grew, private coverage decreased. For low-income parents, private insurance also decreased (from 51 to 46 percent), while public coverage remained unchanged at 19 percent. With $24 billion set aside by the federal government for SCHIP’s first five years, a statement released by the still optimistic Department of Health and Human Service in September 1999 predicted that approximately 2.6 million more children would be insured within the next year.

Adding to the bad news, “Uninsured in America: A Chart Book,” a Kaiser Family Foundation study of 21 states released last month, found that from June 1997 to June 1999, not only did Medicaid expansion fail to shrink the pool of uninsured low-income children; the number of Medicaid cases itself shrank. On the other hand, the “1997 Economic Census – Health Care and Social Assistance,” by the U.S. Census Bureau, found that, across all 50 states, employer-based coverage actually increased for low-income children in 1996.

Two general conclusions can be drawn from these findings: First, in the words of Barbara Blum, director of the Research Forum for Children, Families and the New Federalism at Columbia University’s National Center on Children and Poverty, “It shows how hard it is to get and use data well.” Second, in the words of Jocelyn Guyer, policy analyst at the Center on Budget and Policy Priorities, “We have not made that much progress.”

The culprits in the poor results of SCHIP and public insurance expansion are plenty: time (it’s too early for there to be clear successes, said Ann Greiner, director of public affairs at HSC), insufficient SCHIP outreach, substitution or “crowding out” (people dropping private insurance when they see that they are eligible for public), rising costs of private health care, and employer resistence to providing employee and/or dependent health insurance.

One factor that some health experts see as the great setback is the Personal Responsibility and Work Opportunity Act of 1996. As welfare reform took effect, efforts were made to “de-link” Medicaid from welfare, but state-level systems were not updated and computers automatically knocked those leaving welfare out of the Medicaid system as well. Public education efforts were not strong enough to let people know that they were still eligible for Medicaid, and how they could continue to be covered.

States have allowed children “to fall off Medicaid,” said Guyer, noting one-third of all children leaving welfare lose their Medicaid coverage. In addition, one-half of parents lose Medicaid when they leave welfare.

“I think it’ll still take a little time to work out the negative effects of welfare legislation,” Guyer said.

“There needs to be continued pressure” on the state agencies, said Suzanne Hansen, director of Medicaid policy at the National Association of Children’s Hospitals (NACH). Some of this pressure is coming from Families U.S.A., the Center on Budget and Policy Priorities, the NACH, the Children’s Defense Fund and other national and state groups.

In April, the U.S. Health Care Financing Administration, which has been working on the issue with NACH, its member children’s hospitals and other organizations, sent a letter to all the state Medicaid directors demanding that they use Medicaid funds to follow up with former welfare recipients to make sure they were not “inappropriately” cut from Medicaid.

If all states comply, said Hansen of the children’s hospitals association, showing a low-goal optimism, she foresees “certainly an increase back to the pre-’97 levels” of Medicaid coverage.

Several states have been noted for their strong or innovative efforts to increase health coverage. Florida developed a mail-in system to apply for public insurance, to catch working parents who have no time to visit insurance offices. The Arkansas Children’s Hospital funded numerous outreach efforts, and the state adopted some of them. In Indiana, Gov. Frank O’Bannon (D) made increasing insurance among low-income children a priority. In Arizona, outreach workers visit baseball fields to find eligible families.

“There needs to be a short-term strategy and a long-term strategy,” said Blum of the National Center on Children and Poverty. The short term strategy is increasing outreach and facilitating the application process. In contrast to the complicated world of health care, Blum’s long-term strategy is straight-forward: “It’s clearly universal health insurance that’s needed.”

Contact: Center for the Study of Health System Change (202) 554-7549; Kaiser Family Foundation (202) 347-5270.

– Amy Bracken

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