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 Covering Children Through SCHIP And Medicaid: A Success Story, But An Incomplete One

In Fourth Paper In Health Affairs Series On SCHIP, AHRQ Researchers Show That Remaining Eligible But Uninsured Children Include Some Of Nation’s Most Disadvantaged

Bethesda, MD -- Through Medicaid and the State Children’s Health Insurance Program (SCHIP), the United States has continued to make great progress in increasing health coverage for the nation’s children, but many eligible children remain uninsured, two researchers from the Agency for Healthcare Research and Quality (AHRQ) report in a Health Affairs Web Exclusive published today. http://content.healthaffairs.org/cgi/content/abstract/hlthaff.26.5.w618

Eligibility for Medicaid and SCHIP stayed relatively constant between 2001 and 2005, yet increased enrollment caused the number of children with public coverage to rise from 16.2 million in 2001 to 21.0 million in 2005. The number of children with private coverage declined from 13.5 million to 11.4 million over the same period. Because public coverage increased faster than private coverage fell, the percentage of children who were uninsured declined. As of 2003, the uninsurance rate among children dropped for the first time below levels last seen in the 1970s, and by 2005 the uninsurance rate stood at 11.7 percent.

Increased enrollment also reduced the number of eligible but uninsured children from a peak of 7.6 million in 2001 to 5.5 million (or 62 percent of all uninsured children) in 2005, report Julie Hudson and Thomas Selden, economists at AHRQ’s Center for Financing, Access, and Cost Trends. In their paper, the fourth in a Health Affairs series on SCHIP, Hudson and Selden used data from the 1996-2005 Medical Expenditure Panel Survey (MEPS). MEPS is conducted by AHRQ, an agency within the federal Department of Health and Human Services.

Hudson and Selden hail the success of Medicaid and SCHIP in reducing uninsurance among children, but they caution that “we must not lose sight of the enrollment (and retention) shortfalls demonstrated by the number of eligible but uninsured children.” The remaining 5.5 million eligible but uninsured children include “some of the most disadvantaged children in the United States.” The authors find that “36.1 percent were in families with incomes below poverty, and another 41.1 percent were in families with incomes of 100-200 percent of poverty. They are disproportionately minority and more likely than average to live in homes with only a single (or no) parent.”

These remaining eligible but uninsured children are “in somewhat better health than children already enrolled in public coverage” and so would be “relatively inexpensive” to cover, but “they may prove difficult to reach,” Hudson and Selden point out. “There is a growing literature suggesting that one way to improve take-up among children would be to make more extensive use of schools, school lunch programs, the food stamps program, and other public programs to help identify” children eligible for Medicaid and SCHIP.

MEPS Data Produce Higher Estimate Of Number Of Eligible
But Uninsured Children Than Reported In Recent TRIM Study

Hudson and Selden note that their estimates of the number of eligible but uninsured children are higher than estimates from a recent analysis produced for HHS by the Urban Institute’s Transfer Income Model (TRIM) and data from the Census Bureau’s Current Population Survey (CPS). The TRIM study found that only 1.1 million children were eligible for public coverage but uninsured in 2003-04. Hudson and Selden explain that the difference stems primarily from the fact that the TRIM analysis counted children as uninsured only if they lacked coverage for an entire calendar year. In contrast, Hudson and Selden’s MEPS-based analysis counted children as uninsured if they lacked coverage for an entire interview round, which lasts an average of three to five months.

However, even when Hudson and Selden analyzed their data using the TRIM coverage definition, they found that 1.8 million children were Medicaid-eligible but uninsured for an entire calendar year in 2003-04 -- a number far larger than the corresponding TRIM estimate of 0.26 million. The estimates for SCHIP-eligible children who were uninsured for an entire calendar year in 2003-04 were much closer: 1.0 million for Hudson/Selden versus 0.79 for the TRIM study. Hudson and Selden also note that whereas their estimates of eligible but uninsured children exceed TRIM estimates, they align closely with non-TRIM estimates by other researchers at the Urban Institute.

Raising And Lowering SCHIP Income Thresholds

Hudson and Selden also simulated the effects of increasing the SCHIP income threshold to 300 percent of poverty in all states or, alternatively, rolling back the income threshold to 200 percent of poverty in all states. Increasing the threshold to 300 percent of poverty would make an additional 1.2 million uninsured children eligible for SCHIP. Rolling back the threshold to 200 percent of poverty would eliminate eligibility for 0.7 million children enrolled in public coverage.

Whatever the outcome of the debate over SCHIP thresholds, the authors urge readers not to lose sight of the “persistence of uninsurance among the nation’s disadvantaged children, despite eligibility for free or highly subsidized public coverage.”


ABOUT HEALTH AFFAIRS:

Health Affairs, published by Project HOPE, is the leading journal of health policy. The peer-reviewed journal appears bimonthly in print with additional online-only papers published weekly as Health Affairs Web Exclusives at www.healthaffairs.org.

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©2007 Project HOPE–The People-to-People Health Foundation, Inc.