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Jennifer Klein's Files
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Problem
Number of uninsured kids is high and growing
9.8 million uninsured children in 1995, up from 8.3 million in 1992
This compares to:
7.0 million uninsured 45 to 64 year olds (including early retirees)
7.5 million unemployed uninsured (not including dependents; not
necessarily receiving UI)
Most uninsured kids come from working families
6.6 million of the 9.8 million uninsured children are in families above poverty
Uninsured 1 14.2% for children
Medicaid coverage of children is slowing
No growth in enrollment of children between 1994 and 1995
Probably continued slow growth given welfare reform's effect on poverty-related
covarege
Children in Families
Opportunity
100 . - 200% of PO verty
Widespread support for kids
are losing must
2/35 above poverty
Stronger safety net for kids in the wake of welfare reform
Medicaid will be changed anyway next year
Constraints
"New, entitlement" program
Money
Fear of employer dropping
Conflict with Medicaid and state-initiated programs
B-271717
Figure 2: The Percentage of Children
and Adults With Private Insurance
80
Percent
Declined Since 1987
78
76
74
72
70
68
66
64
62
60
1987
1988
1989
1990
1991
1992
1993
1994
Year
Children Under 18 Years Old
Aduits 18 to 64 Years Old
Figure 3: The Percentage of Uninsured
Has Begun to Rise in the Last 2 Years
20
Percent
for Children but Not Adults
19
18
17
16
15
14
13
12
11
10
1987
1988
1989
1990
1991
1992
1993
1994
Year
Children Under 18 Years Old
Adults 18 to 64 Years Old
Source: The Bureau of the Census.
Page 7
GAO/HEHS-96-129 Children's Health Insurance in 1994
10/07/96
11:51
202 401 7321
HHS ASPE/HP
OCT-07-98 09:52 FROM:CBO/BAD/HRCEU
1
ID:202 225 25%
006
Meanson RECEPIENTS
Table I. Recipients by Category (in millions of people)
1990
1991
1992
1993
1994
1995
Total
25.3
28.3
31.2
33.4
35.0
36.3
Aged
3.2
3.4
3.7
3.9
4.0
4.1
Blind and
Disabled
3.7
4.1
4.5
5.0
5.5
S.9
Children
11.2
13.4
15.2
16.3
17.2
17.2
Adults
6.0
6.8
7.0
7.5
7.6
7.6
Others
I.I
.7
.7
.8
_8
1.5
Table II. Growth
1991
1992
1993
1994
1995
Total
12%
10%
7%
5%
4%
Aged
5%
12%
3%
5%
2%
Blind and
Disabled
9%
10%
12%
8%
7%
Children
20%
12%
7%
6%
-.1%
Adults
13%
4%
7%
1%
.3%
Others
-41%
3%
13%
3%
96%
Parameters for options
Incremental or demonstration
Phased in
Voluntary, not mandatory, for states and individuals
Working family focus
Medicaid remains for sick and very poor children
State-delivered
Builds on Medicaid and state-initiated programs
Relatively inexpensive
Option 1: Medicaid-Based Program for Kids
Create an option for states to participate in a kids' program in the per capita cap proposal
National standards for eligibility, subsidies, and benefits
Only children in families with a worker are eligible
-
Medicaid continues for SSI or other Medicaid children with disabilities
and for families without a worker / very low income
-
Excludes children who have had access to employer-sponsored insurance
within the past 6 months
Uniform, national subsidy schedule
-
No premium for kids up to 133% of poverty (phased in at OBRA schedule
for kids 13-18)
-
Sliding-scale premium for kids with incomes between 133% and 200% of
poverty [upper limit depends on costs; could go to 250%]
Benefits equivalent of private plan [maybe FEHB BC BS] with preventive
services and national cost sharing schedule for children above 133% [note: could
work from Medicaid benefits; question about what to do with EPSDT]
Enrollment must be coordinated through schools
States flexibility to:
Design delivery system with minimal Federal oversight
No explicit matching payments: must contribute as much as is needed to
guarantee benefits to eligibles; may use private money and state money in current
public-private partnerships
Federal funding:
Same per capita payment per child as under per capita cap
For kids between 133 and 200 percent, the Federal per capita amount is scaled
down at the same rate as the sliding-scale premium schedule.
Discussion of Option 1
This option aims to ensure that, in the long run, a child may go from state to state and
remain eligible for the same basic coverage.
It trades national standards for state delivery.
Advantages:
Avoids costs of state Medicaid buy-out; pays only Medicaid per capita (not 100% Federal
subsidy)
Moves toward a 100% Federal program if generous and states withdraw share
Fixes Medicaid's instability for children (Chafee-Breaux welfare amendment) and
simplifies eligibility
May lessen the need for excessive Medicaid flexibility, since this program is flexible
Not "Medicaid"; can be cast as not a welfare program
Disadvantages:
If states that optionally cover children above 133% of poverty take the option, those
children would face new cost sharing
All states may not manage the program well, making the children coming from Medicaid
worse off
Benefits (EPSDT) limited
Option 2. State demonstrations
A.
Mandatory program
Direct HCFA Office of Research and Demonstrations to give preference to 1115 waivers
that expand coverage to children
Allow states that agree to cover children at national eligibility and benefits
standards to limit EPSDT and impose premium and cost sharing on new as well as
old eligibles
B.
Discretionary program
Create discretionary program like the National Endowment for the Arts, with a budget at
whatever can be afforded
The endowment would take applications from states and fund private or públic-private
programs. They would approve only those programs that more toward the national
eligibility and benefits standards.
The endowment could also be responsible for long-term planning to more toward broader
coverage of children
Medicaid: Why a per capita cap may be needed despite recent Medicaid spending slow-down
May be last chance for a per capita cap
Increased flexibility means increased difficulty in implementing and enforcing a
per capita cap
As more 1115s are approved, harder to override them with a per capita cap
Medicaid data problems are getting worse, and could make it impossible to do a
per capita cap in a few years
Not clear that slow growth will last
Flexibility could cost
If spending growth rises in the future and per capita cap is not viable, no
alternative but a block grant
Doing DSH alone may be impossible
Only way to do a kids' expansion through Medicaid without block granting / "budget
neutrality"
AUG 22 '96 03:41PM IHCRP
P.1
GEORGETOWN UNIVERSITY MEDICAL CENTER
Institute for Health Care Research and Policy
FACSIMILE COVER SHEET
TO:
JOHN POR KLEIN
FAX Number:
FROM:
Jeanne
Pages:
Comments: (1) why the old estimates of the
Costs and coverage for kids Need to
be updated - in MINNESOTA - WHICH
is MUCH MORE ANMOGOUS TO OUR OPTIONS
THAN MEDICAID - ONLY 7% OF PARTICIPANTS
proviously HAD INSURANCE, RELATIVE To
OUR Estimate OF 50%
(2) Kios + POVERTY, F41
(3) SOMETIME NUT URGENT, COULD you For
over A Copy of geserday's Seveen ?
/ WANT TO SMARE 13 w/ Juoy WHEN
SHE Gets sacu - CONGRATIONS Again'
2233 Wisconsin Avenue, NW Suite 525 Washington DC 20007
202-687-0880 202-687-3110 fassimile
AUG 22 '96 03:42PM IHCRP
P.2
IS MINNESOTACARE HITTING ITS TARGET?
Nicole Lurie, MD, MSPH
Alfred Pheley, PhD
Michael Finch, PhD
Institute for Health Services Research
University of Minnesota School of Public Health
and
Hennepin County Medical Center
October 24, 1995
AUG 22 '96 03:42PM IHCRP
P.3
Executive Summary
This report was requested by the Minnesota Health Care Commission and
the Minnesota Department of Health to determine:
1.
Whether the state-subsidized MinnesotaCare program attracted the enrollees
it intended to cover.
2.
Whether enrollees had other options for getting health insurance.
3.
Whether enrollees have adequate access to care through MinnesotaCare.
4.
Whether MinnesotaCare has been of benefit to enrollees.
5.
Whether the current premium subsidy structure is reasonable.
Findings
When surveyed, 70% (n-546) were still on MinnesotaCare.
Cost of the program was the major reason people applied (86%).
Learning about the program was the major motivator for applying.
Adverse selection of sick people into MinnesotaCare was not a major
problem-82% enrolled when they were healthy and expected to remain so.
Most people did not have other insurance options when they enrolled in
MinnesotaCare. Over 88% reported no access to employment-based
insurance. Most of those who had access to employment-based insurance
couldn't afford it. Eight percent considered Medicaid to be their option.
Most find MinnesotaCare affordable but say that other insurance options are
not affordable. Most feel the premium is fair and the coverage meets their
needs.
i
AUG 22 '96 03:42PM IHCRP
P.4
Access to care through MinnesotaCare is excellent--91% report it is "very
easy" or "somewhat easy" to receive care when they need it.
Most are in better health because of MinnesotaCare and feel their health
would suffer if the program were to end, and two-thirds of current enrollees
would have to go without care they need. Many report they would spend
down into Medicaid.
A significant number of people make many transitions between Medicaid,
MinnesotaCare, and being uninsured. Administrative solutions, such as
locking people into enrollment for a fixed period of time, might save
administrative costs.
Most of those who would have difficulty affording other insurance if
MinnesotaCare were to end have incomes less than 200% of the federal
poverty limit.
Conclusions
MinnesotaCare seems to be hitting its target. There is little erosion from the
private market, and the current premium structure is "reasonable." Most of those
currently having difficulty affording the premium have incomes less than 200% of
the poverty limit, so increasing the premium contribution for Individuals below that
level is probably unwise. Most people have benefitted from the program and their
health would suffer if they no longer had access to it.
ii
AUG 22 '96 03:42PM IHCRP
P.5
Table 5
EROSION FROM PRIVATE MARKET
% giving up "other Insurance" to go on MinnesotaCare
(n = 781)
OUR EXTIMATES
Private Market
7.1%
~ 50% %
- employment-based
2.8%
- self-insured
4.2%
Public Programs
5.7%
~ 15% 15
-- medical assistance
4.7%
-- other
< 1%
14
AUG 22 '96 03:43PM IHCRP
P.6
UNITED STATES DEPARTMENT OF COMMERCE
NEWS
Economic & Statistics Administration
EMBARGOED UNTIL: 10 A.M. EDT, AUGUST 19, 1996 (MONDAY)
Please note our new policy:
NO BROADCAST OR PRINT BEFORE 10 A.M. EDT
Public Information Office
CB96-135
301-457-3030/301-457-3670 (fax)
301-457-4067 (TDD)
e-mail: [email protected]
T. J. Eller
Kathleen Short
301-763-8579
ALMOST ONE-HALF OF THE NATION'S CHRONICALLY POOR ARE
CHILDREN, CENSUS BUREAU REPORTS
Children made up almost half (48 percent) of the
chronically poor during 1992. and 1993, the Commerce Department's
Census Bureau said today. Over the same period, the
elderly accounted for 11 percent of the chronically poor.
Chronic (or long-term) poverty refers to a situation in which
families stayed below the poverty cutoff every month during
1992 and 1993.
Poverty in the U.S. is based on a familybs income compared
to the familybe poverty threshold, that is determined by the size
of the family, the number of children, and the age of the
householder. For example, the average poverty threshold in 1993
for a family of four was $14,763.
These findings were published in Dynamics of Economic
Well-Being: Poverty, 1992-1993, Who Stays Poor? Who Doesnpt?,
P70-55, a report based on the Survey of Income and Program
Participation (SIPP) The SIPP is a continuing monthly survey of
approximately 20,000 households across the country. The survey
makes it possible to measure movement into and out of poverty and
to distinguish between short-term and long-term poverty. The
SIPP also measures participation in government-assistance
programs, as well as economic well-being.
The report shows that children (persons under 18) were more
likely than non-elderly adults (persons 18 to 64) to remain poor
over a two-year period. According to author T. J. Eller, The
differences in chronic poverty are striking. Eight percent of
AUG 22 '96 03:43PM IHCRP
P.7
children versus s percent of non-elderly adults were poor in all
24 months of 1992 and 1993. About 5 percent of the elderly
population (persons 65 and over) were chronically poor during the
same period.
Other findings from the report include:
-
About 5 percent of the nationbs population, or 12
million people, were chronically poor in 1992 and 1993.
-
Based on annual estimates, about 22 percent of people
who were poor in 1992 were not poor in 1993. People in
married-couple families were more likely to exit
poverty (29 percent) than people in other types of
families (12 percent).
-
Half of poverty spells lasted 4.9 months or longer.
(Poverty spells are defined as two or more consecutive
months below the poverty line.)
-
Half of poverty spells experienced by African Americans
lasted 6.2 months or longer, compared to 4.6 months or
longer for Whites.
The data presented here were collected in a sample survey,
and are therefore subject to sampling variability as well as
reporting and coverage errors.
-X-
08/20/96
12:01
202 401 7321
HHS ASPE/HP
001/008
DEPARTMENT OF HEALTH AND HUMAN SERVICES
ASSISTANT SECRETARY FOR PLANNING AND EVALUATION
OFFICE OF HEALTH POLICY
human SERVICES-USA
&
HEALTH
OF
DEPARTMENT
PHONE: (202) 690-6870 FAX: (202) 401-7321
Date:
From: Jael
To: Chris
Ten
Phone: (202) 690-
Phone:
(202) 690-6870
FAX: (202) 401-7321
Fax:
Number of Pages (Including Cover):
these are the draft we cuculated
Comments: There is a cmf call today to clear So
we can send 8ml thing L. andi, 8 hope
Jack
08/20/96
12:02
202 401 7321
HHS ASPE/HP
4
002/008
DRAFT
Summary of Cost Estimates of Child Only Health Insurance Proposals - Revised
Fall '94 Proposal (Scenario 1)
Full subsidy < 133% poverty
Sliding subsidy from 133% - 250% poverty
No subsidy for >= 250% poverty
Democratic Leadership Proposals:
Low subsidy (Scenario 2)
25% subsidy up to 250% poverty, 10% subsidy thereafter
no maximum income level
High subsidy (Scenario 3)
50% subsidy up to 250% poverty, 25% subsidy thereafter
no maximum income level
Preliminary estimates from ARC (8/14) for the Democratic Leadership Proposals show the
following:
Total take-up is estimated to range from 2 million to 6 million children, with an average cost per
child of $1800-$2700 including the effects of adverse selection. Total program costs range from
$4-11 billion. (GH: 7-17 million children; $1400-$1900 per child; total program costs $13-25
billion)
The Federal share of the program cost is estimated to range from $1-5 billion. (GH: $2-10
billion)
The number of previously uninsured children estimated to be drawn into these programs ranges
from 0.2 million to 2 million, resulting in 10-30% of the participant population being made up of
the target group (those without insurance prior to the program). (GH: 0.1-2 million previously
uninsured children; 2-15% of participant population)
The remaining 70-90% of the participant population are those which were insured previously
(other private, ESI - self-employed, ESI, and Medicaid) but were drawn into the program either
by the subsidy level or by changes in employer behavior (the substitution effect).
Those with Medicaid are assumed to substitute into this program if they are above the federal
floor for Medicaid and if the subsidy is 100% (therefore occurs only in the Fall '94 proposal).
The effects of adverse selection, modeled for the uninsured receiving partial subsidies, were
estimated to increase total program costs by 20-60%. The selection impact is greatest when the
subsidies are lower making the total takeup smaller. (GH: selection impact is 10% to 20%)
Each of these proposals replaces current coverage more than newly covering the uninsured. This
substitution effect varies slightly with the level of subsidy over the ranges given above.
08/20/96
12:02
202 401 7321
HHS ASPE/HP
5.
003/008
Summary of Participation Assumptions for the Kids Coverage Cost Estimate Model
1. The Self-Employed
ARC: If subsidy >= 28%, then 90% participation (=.80*35%)
GH: If subsidy >= 6.75%, then 90% participation (=.45*15%) -- 100% participation was run
to produce a conservative estimate
GH Reason: .45 is the deduction rate for years 1998-2002 (.80 is phased in later); 15% marginal
tax rate is more applicable to the low-income population.
2. Other Private (non-employer sponsored)
ARC: If subsidy >=20%, then 80% participation
GH: If subsidy >10%, then 90% participation - -- 100% participation was run to produce a
conservative estimate
GH Reason: More people will take advantage of this offer if it is implemented through the tax
system.
3. Uninsured
ARC: Scenario 2 (25/10) participation equals 2/3 of Scenario 3 (50/25) participation
Scenario 2:
Scenario 3:
For Case A: 20%/10%
30%/15%
For Case B: 10%/5%
15%/7.5%
For Case C: 5%/2.5%
7.5%/3.75%
GH:
Scenario 2 participation should equal 1/3 of Scenario 3 participation (across all cases).
GH Reason: Few uninsured people will be attracted by the low subsidy of Scenario 2 -- moving
from Scenario 2 to 3 (low to high subsidy) should make a bigger difference.
4. Employer Insurance (ESI)
ARC: Scenario 2 or 3
50% (Cases A/B/C)
0% (Cases A/B/C)
% participation for those <200%
10%/5%/2.5%
5%/2.5%/1.25%
GH -- Scenario 2 (all cases)
14%
4%
Scenario 3 (all cases)
50%
14%
(up to 250% poverty; less thereafter)
GH Reason: Employers are looking for ways to save money and will change their behavior more
dramatically if they are given the "moral out" of knowing that their employees will be able to
take advantage of this other program. ARC believes that employer behavior will not change as
radically at least not as a result of this kids only program.
004/008
Democratic Leadership Proposals -- Summary Cost Estimates
Estimates Shown for Medium Participation Assumption (Case B)
4
Participants - Coverage Prior to Program
Financing
Low
Avg
Total
%Unins
Unins
Unins
7
Other
Other Priv
MC
ESI
ESI
Total
Federal
Selection
Subsidy
Cost
takeup
in Prog
Offd
Private
+ MC
SE
Cost
Share
Impact
Scenario 2
ESI
50% Emp
ARC
$2400
2.4 m
23%
0.4 m
0.1 m
1.2 m
0.1 m
0.00
0.5 m
0.00
$5.7 B
$1.4 B
62%
Contrib
Assump
GH
$1800
8.6 to
3%
0.2 ID
0.04 m
3.2 in
0.2 m
0.00
2.1m
2.9 ID
$15.0 B
$2.6 B
13%
A
ssump
0% Emp
ARC
2.0 m
22%
0.4m
0.02 m
1.2 m
0.1 m
0.00
0.00
HHS ASPE/HP
$2300
0.3 m
$4.7 B
$1.2 B
51%
Contrib
Assump
GH
$1900
7. Im
3%
0.2 m
0.009 m
3.2 no
0.2m
0.00
0.6m
29 m
$13.4B
$2.2 B
15%
Assump
Participants - Coverage Prior to Program
Financing
High
Avg
Total
%Unins
Unins
Unins
Other
Other Priv
MC
ESI
ESI
Total
Federal
Selection
Subsidy
Cost
takeup
in Prog
Offd
Private
+ MC
SE
Cost
Share
Impact
Scenario 3
ESI
401
08/20/98 12:02 6202 7321
50% Emp
ARC
$2000
4.7 m
20%
0.7 m
0.2 m
2.6 m
0.1 m
0.00
0.5 m
0.6 m
$9.7 B
$4.1 B
28%
Contrib
Assump
GH
$1500
6.3m
6%
0.7m
0.2 m
3.2m
0.2m
0.00
9.2ml
29m m
$24.0.B
$9.7 B
10%
Assump
0% Emp
ARC
$2200
4.3 m
18%
0.7 m
0.03 m
2.6 m
0.1 m
0.00
0.2 m
0.6 m
$9.4 B
$3.9 B
33%
Contrib
Assump
GH
$1800
9.4 m
-8%
0.7 in
0.03 in
3.2 m
0.2 m
0.00
2.4m
2.9 m
$16.7 B
$6,3 B B
16%
Assump
I
005/008
Democratic Leadership Proposals -- Cost Estimates
Scenario 2 (Low Subsidy): 25% Subsidy up to 250% Poverty, 10% Subsidy for 250% Poverty and Above
VL
50% Employer Contribution Requirement
High (Case A), Medium (Case B), and Low (Case C) Participation Assumptions Shown
Participants - Coverage Prior to Program
Financing
Scenario 2
Avg
Total
%Unins
Unins
Unins
Other
Other Priv
MC
ESI
ESI
Total
Federal
Selection
Cost
takeup
in Prog
Offd
Private
+ MC
SE
Cost
Share
Impact
HHS ASPE/HP
;
ESI
ARC
A
$2100
3.6 m
33%
0.9 m
0.3 m
1.2 m
0.1 m
0.00
1.1m
0.00
$7.4 B
$1.8 B
50%
Assump
B
$2400
2.4 m
23%
0.4 m
0.1 m
1.2 m
0.1 m
0.00
0.5 m
0.00
$5.7 B
$1.4 B
62%
C
$2500
1.9 m
14%
0.2 m
0.04 m
1.2 m
0.1m
0.00
0.3 m
0.00
$4.6 B
$1.1 B
59%
GH
A
$1800
8.8m
6%
0.4 TU
0.1 m
3,2m
0.2m m.
0.00
2.1m
29 m
$15.8.B
$2.8B
16%
Assump
B
$1800
8.6m
3%
0.2 m
0.04 m
32 m
0.2 m
0.00
En 2 E
2.9m
$15.0 B
$2.6B
13%
08/20/96 12:04 202 401 7321
$
$1700
8.4m
2%
0.1m
0.03 m
3.2m
02m-
0.00
2.1m
2.9 m
$14.5.B
$2.6B
11%
2
006/008
4.
Scenario 3 (High Subsidy): 50% Subsidy up to 250% Poverty, 25% Subsidy for 250% Poverty and Above
50% Employer Contribution Requirement
I
High (Case A), Medium (Case B), and Low (Case C) Participation Assumptions Shown
Participants - Coverage Prior to Program
Financing
Scenario 3
Avg
Total
%Unins
Unins
Unins
Other
Other Priv
MC
ESI
ESI
Total
Federal
Selection
Cost
takeup
in Prog
Offd
Private
+ MC
SE
Cost
Share
Impact
ESI
ARC
A
$1800
6.2 m
30%
1.4 m
0.4 m
2.6 m
0.1 m
0.00
1.0 m
0.6 m
$11.2 B
$4.9 B
20%
HHS ASPE/HP
Assump
B
$2000
4.7 m
20%
0.7 m
0.2 m
2.6 m
0.1 m
0.00
0.5 m
0.6 m
$9.7 B
$4.1 B
28%
C
$2100
4.0 m
13%
0.4 m
0.1 m
2.6 m
0.1 m
0.00
0.2 m
0.6 m
$8.5 B
$3.5 B
27%
GH
A
$1400
172m &
11%
14m
0.4 in
3,2m
0.2 m
0.00
9.2m
2.9 m
$24,9 B
$10.28
8%
Assump
B
$1500
163 in
6%
0.7 18
0.2m
3.2 In
0.2 m
0.00
9.2 m
2.9m
$24.0 B
$9.7 B
10%
W
$1400
159
3%
0.4m
0.1 II
3.2m
0.2m
0.00
9.2 m
2.9m
$23 1 B
$9.3 B
8%
08/20/96 12:05 202 6202 401 7321
3
007/008
Scenario 2 (Low Subsidy): 25% Subsidy up to 250% Poverty, 10% Subsidy for 250% Poverty and Above
0% Employer Contribution Requirement
High (Case A), Medium (Case B), and Low (Case C) Participation Assumptions Shown
Participants - Coverage Prior to Program
Financing
Scenario 2
Avg
Total
%Unins
Unins
Unins
Other
Other Priv
MC
ESI
ESI
Total
Federal
Selection
Cost
takeup
in Prog
Offd
Private
+ MC
SE
Cost
Share
Impact
ESI
ARC
A
$2200
2.8 m
33%
0.9 m
0.02 m
1.2 m
0.1 m
0.00
0.5 m
0.00
$6.2 B
$1.5 B
55%
HHS ASPE/HP
Assump
B
$2300
2.0 m
22%
0.4m
0.02 m
1.2 m
0.1 m
0.00
0.3 m
0.00
$4.7 B
$1.2B
51%
C
$2700
1.7 m
14%
0.2 m
0.008 m
1.2 m
0.1 m
0.00
0.1 m
0.00
$4.4 B
$1.1 B
65%
GH
A
$1800
7.3m
6%
0.4 m
0.02 m
3.2m
0.2 m
0.00
0.6 m
2.9,m
$13.4B
$2.2.B
13%
Assump
B
$1900
7.1m
3%
0.2m
0.009 m
3.2m
0.2m
0.00
0.6 m
2.9m
$13.4.B
$2.28
15%
401 7321
C
$1800
6.9 m
2%
0. Lm
0.005m
3.2m
0.2m
0.00
0.6m
2.9 n
$129B
$2.1B
12%
08/20/96 12:07 202
4
008/008
Scenario 3 (High Subsidy): 50% Subsidy up to 250% Poverty, 25% Subsidy for 250% Poverty and Above
0% Employer Contribution Requirement
High (Case A), Medium (Case B), and Low (Case C) Participation Assumptions Shown
Participants - Coverage Prior to Program
Financing
Scenario 3
Avg
Total
%Unins
Unins
Unins
Other
Other Priv
MC
ESI
ESI
Total
Federal
Selection
Cost
takeup
in Prog
Offd
Private
+ MC
SE
Cost
Share
Impact
ESI
ARC
A
$2000
5.3 m
29%
1.4 m
0.05 m
2.6 m
0.1 m
0.00
0.5 m
0.6 m
$10.5 B
$4.5 B
27%
HHS ASPE/HP
Assump
B
$2200
4.3 m
18%
0.7 m
0.03 m
2.6 m
0.1 m
0.00
0.2 m
0.6 m
$9.4 B
$3.9 B
33%
C
$2200
3.8 m
11%
0.4 m
0.03 m
2.6 m
0.1 m
0.00
0.1 m
0.6 m
$8.4 B
$3.4 B
28%
GH
We
$1700
10.1m
15%
14 4m
0.05m
3.2m
02m
0.00
2.4 m
2.9 m
$17.4 B
$6.7 B
15%
Assump
B
$1800
9.4 Em
8%
0.7m
0.03 m
3.2m
0.2 m
0.00
2.4hr
2.9.m
$16.7 B
$6.3 B
16%
202 401 7321
$1700
9.0m
5%
0.4m
0.03 m
3.2 m
0.2m
0.00
2.4m
2.9m
$15.7B
$5.9 B
43%
08/20/96 12:08
5
MEMORANDUM
DATE:
August 17, 1996
TO:
Jennifer Klein
C.C.
Chris Jennings
FROM: Stan Dorn, Gregg Haifley
RE:
Children's coverage
A few weeks ago, Gregg spoke with you about a possible children's health coverage
initiative. Issues were raised about costs, and we thought you might find the attached
piece helpful. It discusses possible approaches to certain key cost issues -- the possibility
that, in response to new public subsidies for children's health coverage, states might drop
optional Medicaid coverage of pregnant women and children, and employers might drop
coverage for children.
One other thought we've had about cost is that new children's subsidies could be phased
in to parallel the age-based expansion of guaranteed Medicaid coverage. In other words,
subsidies could be limited to children born after September 30, 1983 who are ineligible
for Medicaid. Medicaid, not the new subsidy system, would cover children in poverty.
Not only could this lower the cost of a new subsidy program, it would allow the argument
that the children who need help are not poor children thankfully covered by Medicaid, but
rather are children of working, middle-class parents, increasingly left behind by changes
in the global economy, who need some assistance to provide their own children with
health care.
We've also attached some interesting polling data from Kaiser, on the off chance that you
haven't had a chance to look at their recent report closely.
Appendix B
CONTROLLING COSTS BY PREVENTING COST-SHIFTS FROM CURRENT
PURCHASERS OF CARE
Any system that increases health coverage for children should avoid excessive
costs by discouraging current purchasers of care from dropping their coverage and
shifting costs into the new system. Scarce public dollars should help additional children,
not substitute for current spending on children.
Two groups of current purchasers of care are potentially at issue. The first group
would matter only to a new federal system for helping children. The second group would
be important in the design of either federal or state programs.
States should be discouraged from dropping Medicaid coverage for children
and pregnant women. Many states provide Medicaid coverage to optional
groups of children and pregnant women--groups the states are not required by
federal law to cover. If a new, federal system covers children and pregnant
women, some states may cut back their optional Medicaid coverage, shifting costs
onto the new, federal system.
The simplest way to avoid this problem is a maintenance of effort requirement --
that is, states wishing to participate in the new system could be forbidden from
cutting back their Medicaid coverage. Such a measure is far from unprecedented.
For example, when Congress expanded guaranteed Medicaid coverage for
pregnant women in 1989, states were forbidden from cutting back their previous,
optional coverage. Similarly, when Congress extended cash assistance to the
elderly, blind and disabled through SSI, states were forbidden from cutting back
their previous efforts to provide cash assistance to those same populations.
Although maintenance of effort requirements are familiar, some state officials
may complain that they should not be held to a higher standard because they
previously helped more children than was required. To some extent, better-off
states have been providing more optional coverage, and can afford to be held to a
higher standard. But one way to respond to such state concerns without opening
the door to a large cost-shift from Medicaid to a new federal program for children
would be to keep current law Medicaid coverage in place but provide an increased
federal match for Medicaid coverage of children and pregnant women that
exceeds minimum, federal standards. States that have treated children well would
be rewarded with increased federal assistance, but federal costs could be kept at a
level far lower than would result from states' wholesale abandonment of optional
Medicaid coverage for children and pregnant women.
Employers should be discouraged from dropping their coverage of children.
Some academics have claimed that increased coverage of children and pregnant
women, through Medicaid or otherwise, "crowds out" health coverage offered by
employers. The contention is that, if Medicaid or other public coverage is
available, workers ask their employers for pay hikes funded by eliminating
employer-funded health coverage during pregnancy and health coverage for
workers' children. The significance of this "crowd-out" or "employer
substitution" effect is much dispute and has been the subject of several studies in
recent years, with more forthcoming.
This issue arose during the health care reform debate in the 103rd Congress. The
bill reported out by the Senate Finance Committee provided subsidies for
families' health insurance. The bill reduced subsidies, dollar for dollar, based on
employer contributions to health premiums. The bill also prohibited companies
that do not self-insure from providing more generous health coverage to lower-
wage workers, potentially eligible for subsidies, than to higher-income employees
ineligible for subsidies. Current law already prohibits such discrimination by
companies that self-insure.
The Congressional Budget Office ("CBO") found that the "crowd-out" costs
would be very moderate. It analyzed this proposal as follows:
"Some low-income workers could gain thousands of dollars in higher
wages by moving to firms that did not contribute to employee health
insurance. That process would occur gradually as employment expanded
in some firms and contracted in others. In the CBO estimate, this
reallocation of low-wage workers among firms accounts for $12.6 billion
[i.e., would increase total subsidy costs by 8.5%] of the cost of the
subsidies in 2004 [the ninth ycar of the program]."
"In addition, some companies might stop paying for insurance, but
the effect of that action on the government's costs would probably
not be large, for several reasons. For one thing, the number of
firms that would be likely to stop paying is limited because, if
firms did so, high-wage workers in those firms would lose the tax
benefits of excluding health insurance from the payroll tax.
Moreover, the net additional subsidy cost to the government
would be largely offset by higher tax revenues from the workers
because wages would be higher."
CBO took a similar view in its analysis of Majority Leader Mitchell's bill, finding
that movement of employees to firms not paying for health coverage could
increase total premium subsidy costs by 8.8% in 2004. 2 It is unknown why
'CBO, A Preliminary Analysis of the Health Security Act as Reported by the Senate Committee
on Finance (July 28, 1994) pp. 11-12; Table 1.
2
A Preliminary Analysis of Senator Mitchell's Health Proposal (Aug. 9, 1994) PP. 15, Table 1.
2
this figure was minimally higher for the Mitchell proposal than for the Finance
Committee proposal.
Based on this analysis, a similar policy applied to children's health care -- an
extension of the existing prohibition against discrimination on the basis of
income, coupled with a reduction of government assistance based on the
availability of help from the employer -- likely would increase total costs by less
than 4.3%, or half the average of the CBO cost-estimates from the Finance
Committee and Mitchell proposals. A children's health program would offer a
much lower amount of assistance to a worker, hence a much reduced potential
salary advantage from changing jobs.
In fact, this 4.3% figure overstates the likely costs, in several ways. First, actuaries
estimate that children's health coverage averages 50% of the cost of coverage for
a single, working adult. This is considerably less than 50% of the cost of family
coverage, and family subsidies were a major part of the Mitchell and Finance
Committee bills. Second, the analysis assumes that workers' willingness to
change jobs decreases 50% as the potential salary benefit drops by 50% or more.
In fact, such reduced willingness to change jobs probably would be greater, given
the inconvenience and risk of changing employment. Finally, CBO assumed only
a gradual cost effect, reaching a peak of roughly 8.5% after nine years.
The policy evaluated by CBO becomes particularly appealing when the
alternatives are considered. On the one hand, employers could be required to
cover children or to maintain current spending for children's health care. Such
approaches could be difficult to enforce and likely would create enormous
opposition. On the other hand, some have proposed that children without health
coverage could be denied assistance and remain without health care for four
months or more, thereby eliminating any supposed incentive for employees to
request a reduction in their children's health coverage. Some have even
proposed that if employers have ever offered health coverage for children, even if
they did not offer to pay for it, children should be barred from health coverage
under a new system. There is no need to go to such extremes that would deny
children the health care they need. A far more moderate and reasonable policy
has already received a favorable score from CBO.
3
THE HENRY I.
KAISER
THE KAISER-HARVARD PROGRAM ON
FAMILY
FOUNDATION
THE PUBLIC AND HEALTH/SOCIAL POLICY
Survey of Americans on Health Policy
Questionnaire and National Toplines
July 30, 1996
A JOINT PROGRAM OF THE HENRY J. KAISER FAMILY FOUNDATION AND HARVARD UNIVERSITY
KAISER FAMILY FOUNDATION: 2400 SAND HILL ROAD, MENIO PARK, CA 94025 415 854-9400 FAX 415 854-4800
C
OF PUBLIC HEALTH: 677 HUNTINGTON AVENUE, BOSTON. MA 02115 617 432-4502 FAX 617 432-0092
16
26.
For which ONE of the following groups, if any, do you think we should try to provide health
insurance coverage first? (READ AND ROTATE ITEMS 1-4)
Total
Republicans
Democrats
Independents
48%
53%
45%
46%
Children
22
21
22
23
Working people who are currently
uninsured
15
13
16
15
All low-income people
10
9
10
11
People who need long-term care
4
2
6
4
Don't know
1
1
1
1
Other (VOL.)
*
1
*
*
None (VOL.)
*
*
*
*
Refused
27.
Would you be willing to pay more--either in higher health insurance premiums or higher
taxes--in order to guarantee health insurance coverage for all Americans, or not?
Total
Republicans
Democrats
Independents
60%
46%
72%
63%
Yes, willing
36
49
26
35
No, not willing
3
5
2
1
Don't know
1
*
*
1
Refused
AUG 01 '96 07:26PM IHCRP
P.1
GEORGETOWN UNIVERSITY MEDICAL CENTER
Institute for Health Care Research and Policy
FACSIMILE COVER SHEET
TO:
VENNIFER KLEIN
FAX Number:
FROM:
Jeanne
Pages:
Comments:
ATTACHED IS (1) Latest THOUGHTS
(2) OLD ESTIMATES.
THE MAYOR DIFFERENCES B/W THIS
OPTION + THE ord froaRm ARE:
(1) MEDICAIS INTERACTION. - / THINK ,T'S
PROPARLY impossible TO TRUCY WYCC
OFF MEDICAID, ESPECIALLY BECAUSE
STATES HAVE TO Aminister THE PROGRAM.
USING THE MCD por CAPITA COULD HELP
(2) PIFFENTIATING KIDS IN WORKING
FAMILIES. IT'S KIND of oacy,
BUT MAY HELP w/ COSTS (APVERA SELECTION)
AS WELL AS POLITICS.
We'u Catch UP NEXT WEEK. AND, CONGRATULATIONS
ARAIN ON your HEALTH CARE Successes!
2233 Wisconsin Avenue. NW Suite 525 Washington DC 20007
202-687-0880 202-687-3110 fassimile
AUG 01 '96 07 26PM IHCRP
P.2
Parameters for Kids' Program
The following is a list of the assumptions that have a strong influence on how a kids' program is
structured. Different assumptions would lead to different options.
1. Goal is to extend health insurance coverage
While this may seem obvious, there are other, maybe more efficient ways to improve
kids' health (e.g., increased state block grants for maternal and child health; increase
community-health center funding; target DSH payments to hospitals serving high
numbers of uninsured children). It also precludes policies like tax credits which would
?
likely have a very small impact on the number of uninsured.
2. Incremental: Given recent experience, the proposal should be:
Optional: No mandates for individuals or states
Targeted toward the working poor
Private, managed-care oriented
Phased in
3. Administered through States, in tandem with Medicaid
Why ?
Uses system already in place: States' health and human services divisions are the only
currently-running organizations that conduct income determination in all areas.
Helps move toward a poverty-based eligibility determination for Medicaid.
Minimizes financial and programmatic conflicts between Medicaid and the new program.
Allows the use of Medicaid funding (for approximately one-third of Medicaid kids in
working families being transferred to the new program).
Problems:
Moves away from a fully Federal program. While this adds uniformity of eligibility and
benefits, it allows variation in how kids are covered. Once the States are given a greater
role, it will be even harder to replace them with a full Federal program.
Difficult to monitor and enforce. The problems experienced in Medicaid will also be
experienced in this program, maybe exaggerated given limited Title XIX-like protections.
For some States, eligibility for full subsidies is lower than in current Medicaid.
As for any kids' program, the targeting of the uninsured is not efficient.
7
AUG 01 '96 07:26PM IHCRP
P.3
Kids' Program: State Choice
How it would work
States have the option to participate in a Federally-defined kids' program distinct from
why not
Medicaid.
all Fedural
The Federal government sets parameters for eligibility, benefits and enforcement,
and contributes toward the cost of coverage.
States who opt to participate design the way that kids are covered. They may use
their State employee system, private purchasing cooperatives, school-based
programs, or any other vehicle that suits their circumstances.
Eligibility
Low-income children in families with a worker:
No premium for kids up to 133% of poverty
Sliding-scale premium for kids with incomes between 133% and 200%
[upper limit depending on costs]
Phase-in:
For children currently 6 and 13 years up to 133% PL: Immediately
[could phase in with the 6 year olds, one year at a time if too costly]
For children currently 13 to 18: OBRA schedule up to 133% PL
For buy in (sliding-scale premium): Immediately
Exclusions (note: Medicaid eligibility is virtually unchanged):
Children eligible for Medicaid through SSI or institutionalization
Children eligible through OBRA '90 in families without a worker
Children who have had employer-sponsored insurance within the past 6 months
7
Benefits
FEHBP Blue Cross / Blue Shield; Federal standards for cost sharing
Funding
States get the child per capita limit (Federal spending per child in 1995, inflated by the
why
per capita cap index) for enrolled kids below 133 percent of poverty. This means that
there is the same Federal payment for kids in either Medicaid or the new program. For
kids between 133 and 200 percent, the Federal per capita amount is scaled down at the
same rate as the sliding-scale premium schedule.
States would make whatever financial contribution is necessary to meet Federal
guidelines for guaranteeing accessible, affordable coverage for the specified children.
Federal costs: Somewhat less than the Fall 1994 option, given (a) Federal costs per child
based on Federal Medicaid per capita, not premium; (b) Medicaid offset.
AUG 01 '96 07:27PM IHCRP
P.4
Supporting Facts
Nation
Medicaid is a major source of coverage for poor children, but its coverage declines
dramatically for children in families above the poverty threshold.
Only about one-quarter of uninsured kids are poor; 30 percent have income between 100
and 185 percent of poverty. About 15 percent of kids with employer-sponsored insurance
are in this income bracket.
Children's Health Coverage, 1993
Poverty Level
Employer-Based
Medicaid & Other
Uninsured
TOTAL
< 100%
1.0
13.5
2.4
16.9
100 to 133%
1.2
2.2
1.1
4.6
134 to 185%
3.5
1.8
1.7
7.1
185 to 299%
10.7
1.9
2.2
14.8
300% and over
21.5
1.9
1.9
25.3
TOTAL
37.8
21.4
9.3
68.6
Source: The Urban Institute. March 1994 CPS adjusted using TRIM2
Children in working families are more likely to be uninsured than children with
unemployed parents.
Nearly 90 percent of uninsured children lived in a family with at least one worker
(GAO, 1995).
About 12 percent of children with a parent working full-time and 21.7 percent of
children with a parent working part-time were uninsured in 1994. This compares
to 14.6 percent of children in unemployed families (GAO, 1996).
States
States have already demonstrated a commitment to children and have developed
innovative approaches to expanding coverage.
Fully half of all States have used the Medicaid options to expand coverage to
children beyond mandatory levels (GAO, 1996).
Over 30 states have either a supplemental public or a public / private partnership
program for health coverage for children (NGA, 1995).
6/1/95
Possible Uses of Funds
Fiscal Years, Billions of Dollars
Total
Total
Total
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
1995-2000
1995-2002
1995-2005
OUTLAYS
Kids' Program (1,2)
Free to 133%, Phase-Out to 240%
0.0
0.0
4.2
5.7
5.9
6.1
6.3
6.6
6.9
7.3
7.7
21.9
34.8
56.7
Temporarily Unemployed Program (2.3)
0.0
0.0
1.5
2.2
23
2.5
2,8
3.0
3.3
3.5
3.8
8.6
14.3
25.0
Limit to those who framerly had insurance
Public Health/ FQHC
0.0
0.2
0.2
0.2
0.2
0.2
0.2
0.2
02
0.2
0.2
0.9
1.5
2.0
AUG 01 '96 07:27PM IHCRP
Long Term Care Program
Expand Home & Community Based Services
0.0
0.0
1.5
1.5
1.6
1.6
1.7
1.8
1.0
1.9
2.0
6.2
9,7
15.4
REVENUES (4)
Program Revenue OMsels (6)
0.0
0.0
0.2
0.2
02
02
0.2
0.2
0.2
0.2
0.3
0.8
1.2
2.0
Self-Employed Deduction
100% Deduction Phased in (5)
-0.5
-0.5
-0.9
-1.4
-2.0
-2.2
-2.4
-2.7
-3.0
-32
-3.5
-7.5
-12.6
-22.3
Long Term Care
Long-Term Care Insurance Tax Incentives
0.0
-02
-0.4
-05
-0.6
-0.8
-0.9
-1.0
-1.1
-1.2
-1.4
-2.5
-4.3
-6.0
Personal Assistance Services Tax Credit
0.0
-0.0
-0.1
-0.1
-0.1
-0.1
-0.1
-0.1
-0.1
-0.1
-0.2
-0.4
-0.7
-1.2
Note: Administrative costs are ot included in these estimates; ASSUME NO INTERACTION BETWEEN MOS AND TU PROGRAM (STAND ALCHE ESTIMATES)
(1) Eligibility based on each cash income. Basing eligibility on anreal cash `ncome would reduce costs and coverage.
Note: Changing these estimates to an 2018 al AGI saves approximately 20%
(2) These estimates assume some employer cr employee drepping of insurance, which would result in small, increased tax revenues
(3) Assumes that unerrgingment pensation is included in come determination
(4) These estimates are effects " revenue, not carlays. Thus, the negative maters indicate decreases in resenue. Peepaed by Treasury.
(5) Pase in: 257, in 1994. 25% in 1995. 50% in 1996, and 75% in 1997 and 100% in 1990. Assumes the self-employed must provide health owerage to ein empkyees in coder to claim a deduction in excess cli 25%
(6) Does not nclude The revenue offsets from the Denr pares comply ed program.
P.5
AUG 01 '96 07:27PM IHCRP
P.6
DRAFT
Coverage of Uninsured Children
Under Medicaid Expansions
and Proposed Children's Health Insurance Program
Millions of Children, 1997
Total Uninsured Children in 1997
8.6
Uninsured Children Over 240% of Poverty
1.8
and Not Eligible for a Premium Subsidy
Uninsured Children Under 240% of Poverty
6.8
and Eligible for a Premium Subsidy or
Coverage Through Medicaid Expansions
Uninsured Children That Will Be Covered
Through Current Law Expansions Of
1.8
Medicaid
Remaining Uninsured Children Under
5.0
240% of Poverty Eligible for a Premium
Subsidy
Uninsured Children Likely To Participate in
1.9
New Kids' Program
Previously Uninsured Children Covered By
3.7
Medicaid and New Kids' Program
NOTES:
Children In Families Under 133% of poverty receive full premium subsidy.
Premium subsidy phases out at 240% of poverty.
Program is assumed to be 8 capped amount provided to states and not an
individual entitlement.
RAF
Distribution of Federal Funds and Participants
By Income Quintile: 1997
(Persons in millions, deflars in billions)
PROGRAMS
Income Quintites
1st
2nd
3rd
4th
5th
Total
Kids' Program (Full Coverage in 1907)
Free to 133% PL; 240% PL Phase-Out
Participants
0.4
2.0
2.0
1.3
0.3
8.9
AUG 01 '96 07:27PM IHCRP
Subsidies
11%
45%
37%
6%
1%
$5.6
Kids + Temporarily Unemployed
Free to 133% PL; 240% PL Phase-Out
Participants
1.1
3.5
4.4
2.2
0.5
11.7
Subsidies
15%
42%
33%
5%
2%
$9.1
Long Term Care Program
High Option (1)
Participante
40%
33%
23%
3%
1%
0.5
Subsidies
60%
26%
13%
2%
1%
$1.8
NOTE: The 1097 costs represent a me year of subsidies; in the "Unes TeMe", only 75% of these subsides are displayed a the programs begin on January 1, 1997.
(1) Assumes Implementation in FY 1998
Income Quintites are Annual Cash Income (19948):
Tet Quintite: 10 - 9,400
2nd Quintite: $9,400-20,400
3rd Quintite: $20,400 - 35,000
4th Quistite: $35,000- 57,500
6th Quintile: $57,500
P.7
AUG 14 '96 02: 25PM IHCRP
P.1
GEORGETOWN UNIVERSITY MEDICAL CENTER
Institute for Health Care Research and Policy
FACSIMILE COVER SHEET
TO:
VENNIFUR KLEIN
FAX Number:
FROM:
Jeanne
Pages:
Comments:
/ Am Jorry I MISSED you THE OTHER
NIGHT. LAST NIGHT, CHMJ CALLED
WITH QUESTIONS ABOUT The OPTIONS T
PROS+ CONS. 40 MAY NOT
COMPLETELY UNDERSTAND THE (cies STATE
OPTION, so / HAVE CILLAPSED ALL
THE PREVIOUS PAGES / form you
INTO A COUPLE ok PAGES. THIS
'J MORE AN FYI, reser I NENT avon
5
THIS w/ you ALREADY.
2233 Wisconsin Avenue, NW Suite $25 Washington DC 20007
202-687-0880 202-687-3110 facsimile
AUG 14 '96 02:25PM IHCRP
P.2
State Program for Kids
Eligibility:
Kids in working families with income below 200 percent of poverty
without insurance (previous 6 months) or access to employer-based
insurance (previous 18 months). This includes Medicaid children in
working families, except for SSI and institutionalized children. Coverage
would be phased in.
Benefits:
FEHBP Blue-Cross, Blue-Shield like package
Delivery System:
State designed. States may cover children through Medicaid, State
employee health plans, private HMOs or any other program suited to the
State's circumstances.
Funding:
Federal:
Federal Medicaid per capita cap amount for kids in the State
Full amount for kids below 133 percent of poverty
Partial amount for kids between 133 and 200 percent of poverty
(for States that currently optionally cover these kids, they would
get the full per capita, as under the per capita cap).
Note: A significant proportion of the total program funding would be a
transfer from Medicaid to the new program. New spending would be for
increased participation and States that do not now cover children at higher
levels.
Participant: No premiums or cost sharing for children below 133 percent of poverty
Sliding scale premium for children 133 to 200 percent of poverty; co-
payments for some services (not for preventive or primary care)
State/Private: The residual funding needed to assure that all eligibles receive the
nationally-defined benefits package.
AUG 14 '96 02 25PM IHCRP
P.3
Discussion of Kids' Options
Why Kids:
One of four uninsured is a child. Children are one of the fastest growing groups of
uninsured.
Probably have greater coverage per dollar spent than TU program [although I am not sure
yet]
Given the problems with the Chafee-Breaux amendment, this offers a substitute. Creates
a uniform, national safety net of benefits and eligibility - - the intent but the not effect of
the OBRA '90 expansion.
Counterbalances State reductions in welfare coverage
Why State Program:
Less expensive than a full subsidy program since (a) only Federal share of per capita; (b)
indexed through per capita cap; and (c) State optional.
Given limited availability of new funding, allows States to use some current Medicaid
funding in a more flexible program to pool for greater purchasing power.
Builds on State Medicaid programs and other initiatives to cover children. Over 30 States
have either State-only or public / private partnerships for coverage of children. Both
Republican and Democratic governors have supported these initiatives; this is one of
Chiles' and Romer's top issues.
May reduce pressure on Medicaid for greater flexibility. If States can have more program
flexiblity for healthy kids, they may not feel the same need to change the Medicaid
program which would remain the source of coverage for kids with special needs.
Disadvantages:
Likely to have some employer dropping.
Advocates might feel that it goes back on EPSDT and other Medicaid protections
If it becomes too flexible, it could do more harm than good by putting current Medicaid
kids at risk.
AUG 10 '96 03:53PM IHCRP
P.1
GEORGETOWN UNIVERSITY MEDICAL CENTER
Institute for Health Care Research and Policy
FACSIMILE COVER SHEET
TO:
Junifer klein
FAX NO.:
FROM:
jrame
DATE:
PAGES INCLUDING THIS
COVER SHEET:
COMMENTS:
2233 Wisconsin Avenue, NW Suite 525 Washington DC 20007
202-687-0880 202-687-3110 /errimile
AUG 10 '96 03:54PM IHCRP
P.2
TO:
Jennifer Klein
FROM:
Jeanne from
RE:
Kids' program and costs
DATE:
August 10
I am tentatively attaching a spreadsheet to give you a sense of the costs of the options. They are
not right: we have to update the underlying data and assumptions in the original model. What
they do show is that we can probably, with some work, get these estimates down to $15 billion to
$18 billion. I can't say what the coverage looks like; for that, we really need Urban Institute.
There are two ways that the costs of the state optional program could be lowered: changing the
policy and refining the estimating.
Policy Changes
Phase in: The attached assumed all kids are eligible day one. There could be two phase
in schedules:
(a)
Bring kids 6 to 13 (today covered at 100%) to 133% PL, and then use the
OBRA schedule to phase in the program for older children;
(b)
Phase the program in for the 6 year olds for whom Medicaid offers
coverage now at 133% PL.
Note that this does not preclude states from using their own money to cover kids
at higher levels / ages or opting not to participate since they can get a full
Medicaid payment for kids at the upper income levels in their current programs.
Drop upper eligibility threshold to 200% of poverty: The 240% upper limit was more
of an historical artifact than scientifically based.
Change from monthly eligibility determination: If we move to maybe a 6 month
eligibility determination, the costs and coverage would be lower. This is more consistent
with what many states do for Medicaid.
Technical Changes
Adjustment for states that would not participate: The current estimates include all
states. To be conservative, it might be useful to keep it this way, but CBO could assume
that some states won't participate, thus lowering costs.
Revisit dropping assumptions and participation rates: I will continue working on
this. Once I figure out a plan, I'll let you know.
Use updated Urban Institute model: The underlying data have changed since 1991
(what we used in 1994). I am not sure if this will increase or decrease costs, given high
numbers of uninsured kids, but slower inflation projections. I think costs may go down.
AUG 10 '96 03: 54PM IHCRP
P.3
Other comments:
One of the cons for the state option - that kids who are currently state optional at higher income
levels would now have to pay - is also a problem for the full federal subsidy program.
The GAO report does say that 62 percent of children on Medicaid have a parent who works.
Attached is a Minnesota fact sheet that I found interesting. I am looking closely at Washington
and Minnesota to see what is going on; also New York's Child Plus program.
I am going to be at the Radisson St. Paul on Sunday and Monday morning. I can't quite find the
phone number but I am sure it is in information. The room is in Judy's name (I also check my
voice mail, so it might be easier to leave a message there if you need to). I originally planned to
come back on Monday night, but the conference doesn't look that great, so I may be back on
Monday afternoon with Judy. Please don't hesitate to call - it's not like I am going on
vacation!
And thank you for listening to me. I have surprised myself at my inability to shake this feeling
of responsibility for the quality of information you get. Its a terrible personality flaw, especially
since I have SO little recourse to suggest ideas or change estimates within the Department. That is
why your taking the time yesterday meant a lot.
DRAFT PRELIMINARY Kids' Program Estimates
Fiscal Years, Billions of Dollars
Total
1997
1998
1999
2000
2001
2002
1997-2002
Kids' Program: Using FEHB Full Premium
Free to 133%, Phase-Out to 240% (1)
4.3
5.9
6.1
6.3
6.5
29.1
AUG 10 '96 03:54PM IHCRP
Excluding Costs of State Optional Medicaid Kids (1)
3.4
4.6
4.8
5.0
5.3
23.2
Kids' Program: Using Medicaid Per Capita
Excluding Costs of State Optional Medicaid Kids (2)
2.9
3.9
4.1
4.3
4.5
19.7
Assumes October 1, 1997 implementation
Eltgibility based on monthly cash income. Basing eligibility on annual cash income would reduce costs and coverage.
Note: Changing these estimates to an annual AGI saves approximately 20%.
These estimates assume some employer or employee dropping of insurance, which would result in small, increased tax revenues.
(1) Estimates from January 1995: they have only been changed to (a) eliminate 1997; (b) use current CPI.
(2) ROUGH APPROXIMATION: This is the full subsidy costs, without State Optional Medicaid kids, multiplied by the ratio of
the CBO Medicaid spending per child by the FEHB premium for a single child. This does not take into account growth rate constraints.
10-Aug-96
P.4
P.5
AUG 10 '96 03:54PM IHCRP
State Programs
Region
Overall, 30% of the MinnesotaCare members we interviewed live in the 7-county Twin Cities metro area, and
70% live in Greater Minnesota.
Health
Ratings of their own health: 29% "excellent," 40% "very good," 24% "good," 5% "fair," and 2% "poor."
Adults/Children
During the survey interviews, 16% gave ratings of adults' care only, 69% gave ratings of both adults' and
children's care, and 15% gave ratings of children's care only.
Age, Education, Gender
The average (mean) age of MinnesotaCare survey respondents is 37. Overall, 16% are less than 30, 48% are
in their thirties, 29% are in their forties, and 7% are 50 or older. Overall, 47% have a high school education or
less, 37% have had some college or other education or training after high school, and 16% are college
graduates. Overall, 22% are men, and 78% are women.
Length of Enrollment
Overall, 69% have been enrolled in MinnesotaCare for 2 years or less, and 31% have been enrolled for more
than 2 years.
Own Contribution to Premium
Overall, 64% pay all of their MinnesotaCare premium themselves, 32% pay part of it, and 4% pay none of it.
How to Use this Web Site
If you're using Netscape or a browser that supports tables' please use these links to find out more about
Minnesota Care Members' ratings of:
Overall Satisfaction
Benefits and Coverage
Handling of Members' Questions and Problems by the Plan
Overall Rating - Able to Get Care When Needed
Getting Appointments When Sick
Getting Medical Help by Phone, Evenings and Weekends
Medical Care Received by Adults
Medical Care Received by Children
If you're using another browser> including non-graphical browsers, please use these links:
Overall Satisfaction
Benefits and Coverage
Handling of Members' Questions and Problems by the Plan
HHS ASPE/HP
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
ASSISTANT SECRETARY FOR PLANNING AND EVALUATION
OFFICE OF HEALTH POLICY
human AN SERVICES. ,USA
&
HEALTH
OF
DEPARTMENT
PHONE: (202) 690-6870 FAX: (202) 401-7321
Date: 8-9-96
From: cheryl 1 Dustein
To: JeN KleiN
Phone: (202) 690-
Phone: 456-2599
(202) 690-6870
FAX: (202) 401-7321
Fax: 456-2878
Number of Pages (Including Cover):
Comments:
002/008
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HHS Accomplishments for Children
In FY 1996, HHS is spending approximately $50 billion, or about a sixth of its total
budget, to sustain its investments in our nation's children and young people. HHS
especially serves children and teens who are disadvantaged.
HHS programs for children in need serve about one in every five children in America.
Secretary Shalala established an HHS Governing Council for Children and Youth,
bringing together all parts of the Department to better serve children, youth and families.
Medicaid
President Clinton firmly upheld his commitment to preserving the Medicaid entitlement
as a sine qua non in the welfare reform negotiations. Medicaid covers over 18 million
children, or roughly one in every five children in the U.S.
Under health care reform waivers in 12 states, many previously uninsured children are
eligible for Medicaid. Massachusetts and Florida alone expect to to cover some 670,000
new children (121,000 and 550,000 respectively) under Medicaid expansions.
Immunization
We are extremely happy with the progress we have made since the Clinton Administration took
office 3 years ago. The Childhood Immunization Initiative (CII) is one of several factors
contributing to this success:
In 1994, 75 percent of the nation's two-year-olds received the full recommended series of
vaccines the highest levels ever recorded. In addition, childhood vaccine-preventable
diseases are now at record lows.
Despite this success, about 25% of our toddlers about 1 million children under age 2 --
lack one or more doses of the full series of vaccinations.
We now plan to reach our Year 2000 goals for children who are two years old in 1997-that is,
90% of all two year olds will be fully immunized in 1997. THIS WILL BE A GREAT
ACCOMPLISHMENT!
Maternal and Child Health Block Grant
HHS provides direct investment in State Health Departments through the Maternal and
Child Health Block Grant. This funding is critical to ensuring that the most vulnerable
children and their families receive needed health care and related services. In FY 1996
the Block Grant was funded for $678.2 million
003/008
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Teenagers and Smoking
In August 1995, the President announced the nation's first comprehensive campaign to
limit both the access and the appeal of tobacco products to minors. Under proposed
regulations by the FDA, children would not be able to buy cigarettes and smokeless
tobacco products, and promotional and advertising gimmicks appealing to children would
be limited.
Teenage Pregnancy Prevention
The Administration's strategy to prevent teen pregnancy encourages abstinence and
personal responsibility by young people, provides financial support to enhance access to
health and family planning services, supports community efforts, and invests in research
and evaluation to determine what approaches work.
As part of this strategy, the President's FY 1997 budget request includes $30 million for
HHS to launch a new Teen Pregnancy Prevention Initiative, to support prevention efforts
in communities with high teen pregnancy rates.
Insurance Reform
The limitations on pre-existing conditions exclusions are expected to protect many
children who would otherwise lack access to needed coverage. There are an estimated
1 million children in families in which at least one individual faces an exclusion for a pre-
existing condition.
Health Care for the Temporarily Uninsured
The President's plan for the temporarily uninsured would extend transitional coverage to
3 million people, including 700,000 children.
001/031
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
ASSISTANT SECRETARY FOR PLANNING AND EVALUATION
OFFICE OF HEALTH POLICY
human SERVICES.USA ,USA)
&
HEALTH
OF
DEPARTMENT
PHONE: (202) 690-6870 FAX: (202) 401-7321
Date:
From: Amy Nevel
To:
Jen Klein
Phone: (202) 690- 7795
Phone: 2024456-2599
(202) 690-6870
FAX: (202) 401-7321
Fax: 202/456-2878
Number of Pages (Including Cover): AAN 34
Comments:
See Attached
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MAY 30 '96 48AM IHCRP
P. 1
To: AMY Never
NATIONAL
GOVERNORS
FR: jeanne
StateLine
ASSOCIATION
Hope THIS HELPS/
Health Policy Studies Division
Contact: Deborah F. Perry, 202/624-5851
July 21, 1995
Innovative State Health Initiatives for Children*
Summary
The health of the nation's children depends on many factors, including the provision of timely and
high-quality preventive health services throughout childhood. Children who have health insurance are
more likely to receive regular, preventive health care than are those who are uninsured. During the
last decade, states have made significant changes to the eligibility criteria for Medicaid that have
increased the number of infants, children, and pregnant women who have access to publicly funded
health insurance. Concurrently, the percentage of children who are covered by private, employer-based
health insurance has declined.
According to a recent report by the U.S. General Accounting Office (GAO), 13.5 percent of all
children living in the United States in 1993. or 9.3 million children, lacked public or private health
insurance for the entire year. Many more were covered for only a portion of that twelve-month
period. In response to this problem. states have launched a variety of programs to ensure health care
coverage of children. This StateLine summarizes the results of a recent survey conducted by the
National Governors' Association (NGA) on state programs that provide health insurance to children
not covered by Medicaid or employer-based insurance.
Background
The Nature of the Problem. A growing number of U.S. children are without health insurance.
Compared with children with health care coverage, uninsured children are less likely to receive early.
preventive health care services such as routine childhood immunizations and are more likely to require
treatment in an emergency room after a health care problem has worsened. GAO recently issued an
analysis of the U.S. Bureau of the Census March Supplement of the Current Population Surveys (CPS)
for 1990 and 1994. The number of children without public or private health insurance increased from
8.7 million children in 1989 to 9.3 million in 1993. During this same period, the percentage of
children covered by employer-based health insurance decreased from 63.2 percent to 57.6 percent.
The Urban Institute also conducted an analysis of the CPS data, but this model merges three years of
data in order to examine differences among states for the period 1990 to 1992.2 These data are the
most current state-by-state figures available. Nationally, 15.8 percent of the total number of
nonelderly residents living in the United States were uninsured. Among all uninsured, nonelderly
residents, 22 percent were children. Data on the percentages of children covered by employer-based
health insurance, Medicaid, and other programs. as well as those in the residual uninsured category.
are presented in Table 1, found at the end of this StateLine.
Hall OF THE STATES I 464 NORTH CANITOL STREET I WASHINGTON D.C. 10001-1573 I 202-624-5300
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Page 2. Innovative State Health Initiatives for Children
According to GAO. nearly 90 percent of uninsured children in 1993 lived in a family where at least
one parent worked; in 61 percent of the families with uninsured children, one parent worked full time
for the entire year. One third of the children who were without insurance in 1993 lived in families with
incomes between 100 percent and 200 percent of the federal poverty level. Medicaid continues to
provide health care coverage for more children in working poor families through a combination of
state-initiated expansions and increased federal mandates. From 1989 to 1993, the number of children
enrolled in Medicaid increased by 54 percent, from 8.9 million to 13.8 million.
Beyond Medicaid Coverage. Medicaid, the state and federally funded health insurance program for
the poor authorized under Title XIX of the Social Security Act, was never intended to provide
coverage for all uninsured citizens. By expanding eligibility criteria for Medicaid. states have
exercised considerable leadership to significantly increase the number of poor children who have
health care coverage.³ Despite state efforts, declining employer-based coverage is resulting in a loss
of health insurance for children. To increase the number of children who have health care coverage,
particularly those in working poor families, many states have created new programs to cover children
who are not eligible for Medicaid. Some of these programs are completely financed and operated by
the state, while other models partner state efforts with those of nonprofit entities.
Recent Studies of Programs for Uninsured Children. In 1993 the National Academy for State
Health Policy released a report describing state efforts to provide health insurance for uninsured
children. Based upon fifteen state examples. Children's Health Plans included detailed information
on eligibility, administration, benefits, financing, and premiums and cost-sharing arrangements. The
report concluded with a section on some of the next steps that policymakers should consider in
addressing the needs of uninsured children as well as the questions that should be answered as these
programs are evaluated.
In its 1994 State Legislation Report. the American Academy of Pediatric, included state-by-state
information on activities related to children's health insurance programs. A majority of states
considered proposals to increase access to health insurance for children. Seven states expanded
Medicaid coverage of children through Section 1902(r)(2) of the Social Security Act-Connecticut,
New Hampshire, New Mexico, North Carolins, Utah, West Virginia, and Wisconsin. In addition.
Pennsylvania expanded eligibility for its state-funded health insurance program through an executive
order effective July 1, 1994; the executive order also added mental health servicesato the benefits
package.
An article published in the spring 1995 issue of the The Future of Children presents an overview of
Medicaid expansions to increase coverage for pregnant women and children. including a brief
description of the impact of Section 1115 waivers on these populations. The article also examines the
increased use of schools to expand health care coverage and services for children. State-funded
programs and the Blue Cross and Blue Shield Caring Programs are explored briefly.
Finally, GAO is conducting a study of children's health insurance programs based on site visits to six
states. Its work will provide information on the financing and costs of these programs;
implementation issues, such as the process for determining eligibility for the programs. the types of
providers, and provider reimbursement rates; benefits, including how the benefits packages were
developed: and the impacts of these programs in terms of service utilization and the extent of coverage
of uninsured children. The report should be available in the fall of 1995.
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Page 3. Innovative State Health Initiatives for Children
NGA Survey on Children's Health Insurance Programs
This StateLine provides updated information on many of the programs and initiatives examined in the
reports cited above. However, with 8 few exceptions, it does not address Medicaid expansions
because this is the subject of the regularly produced NGA newsletter MCH Update. The focus of this
StateLine is state programs-public, private, and public/private partnerships-that provide health care
coverage to children who are traditionally not eligible for Medicaid and who do not have access to
employer-based health insurance through their parents.
Methodology. In consultation with GAO staff, NGA staff developed a survey instrument to req
information from states on their children's health insurance programs related to eligibility criteria.
administration and financing. enrollment, the type of health plans in which children can enroll,
program costs, premiums and cost-sharing arrangements, and benefits offered. The questionnaire was
sent to state maternal and child health contacts, usually in the Medicaid agency. in January 1995.
These contacts were asked to forward the children's health insurance program survey to the
appropriate respondent for the state. Responses were received from all states. and programs in twenty-
nine states are highlighted in this StateLine.
Results Many of the survey results are summarized in Tables 2 through S. found at the end of this
StateLine. When comparing the data on different state programs. it is important to recognize that each
program reflects a unique constellation of policy decisions concerning eligibility, funding. benefits
offered. and service delivery models. The number of enrollees has a direct impact on the budget. and
both the comprehensiveness of the benefits package and the service delivery arrangements affect the
cost per child. Caution must be exercised in drawing conclusions from the data included in the
summary tables.
The programs states reported were categorized into three types: public programs. financed entirely by
federal, state, or local government funds; public/private partnerships, programs funded through a mix
of public, private. or philanthropic funding: and Caring Programs for Children. private programs
administered by regional Blue Cross and Blue Shield plans.⁷
Enrollment and Budget, Table 2 presents data on the number of enrollees. the total budget for the
program, and the sources of funds. The number of children enrolled in the program is related to the
size of the population of children living in the state, the eligibility criteria used by the program. and
the outreach efforts made by program staff. The enrollment data also reflect how long the program
has been in operation. For example. the Healthy Kids program in New Hampshire, which reports the
smallest number of enrollees, just began enrolling children in January 1995. New York's program.
which has been in operation since 1991, has the largest number of children enrolled, reflecting both
the broad eligibility criteria and the size of the state's population of children. Variations in the
budgets for these programs reflect both the size of the population enrolled as well as the
comprehensiveness of the benefits package.
Cosis and Premiums. Table 3 provides data on the average COSE per child per month, the average
premium per month, and the cost-sharing arrangements with families. The cost per child is a result of
many factors, including the cost of living in the state and the medical price index, and reflects the
comprehensiveness of the benefits package offered to program participants. Programs also vary as to
whether parents are asked to contribute to the cost of the premium. In none of the reported Caring
Programs for Children are parents asked to pay any portion of the premium. In nearly all of the
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Page 4, Innovative State Health Initiatives for Children
public/private partnerships, parents pay a portion of the premium. In Florida and New York, families
with incomes above a certain level pay the whole premium amount. In public programs, more than
half of the states require parents to contribute to the cost of the premium on a sliding-fee scale.
Eligibility Criteria. Table 4 describes the eligibility criteria for enrollment in the program. The
majority of the programs target only children. The exceptions are California, which includes pregnant
women: and Georgia. which extends eligibility to the parents of enrolled children. In Minnesota,
Nebraska, Rhode Island. Tennessee, and Utah, children's health insurance coverage is part of a larger
health care program. Nearly all of the children's health insurance programs target low-income
families; the lowest levels of financial eligibility tend to be at or below 100 percent of the federal
poverty level. The highest levels of financial eligibility are set in Minnesota and Rhode Island. at 275
percent and 250 percent of the federal poverty level. respectively. Florida and New York operate two
of the three programs in which all families can participate regardless of income; upper-income
families pay the full premium costs in order to enroll their children in these programs. In Wisconsin's
Youth Med program, all families are eligible regardless of their income.
Covered Services. Table 5 provides information on which services are covered by the programs. Any
copayments that are required. and any caps or limitations on the services are described in detail in the
state profiles found in the appendix. All programs cover physician visits, with all but two specifically
covering well-child visits. Nearly all programs provide coverage for immunizations, and none of these
programs requires a copayment for this service. Other services that are covered by nearly all of the
programs include diagnostic tests, emergency care, and outpatient surgery. Prescription drugs. offered
by approximately two thirds of the programs. is the service for which a nominal copayment is most
often required. Mental health services, offered by more than half of the programs, are most often
subject to caps or limitations placed on the number and type of covered visits. Transportation and
dental services are the least common services to be reimbursed under these programs.
Of the fifteen services listed on the survey instrument. five state programs cover all of the services,
three of which are state Medicaid programs operating under Section 1115 waivers (Arizona,
Tennessee, and Rhode Island). The programs in Minnesora and Washington also cover all of the
services. Several other state programs offer very comprehensive benefits packages, including
California (fourteen services); Florida. Georgia, and Pennsylvania (thirteen services); and Maryland
and New Hampshire (twelve services). In general. the reported Caring Programs for Children tend to
offer a more limited benefits package, perhaps reflecting their limited funding.
Service Delivery Models. Finally. the figure found at the end of this StateLine provides information
on the type of plans in which children can enroll: managed care, fee for service, both, or other.
Fifteen states are offering children coverage for health services through managed care arrangements,
with nine of these providing coverage solely through a managed care system. An additional eight
states are operating their systems on a fee-for-service basis. Seven states have some other service
delivery arrangement, commonly a form of a preferred provider organization; these arrangements are
all reflected in Caring Programs for Children.
State Profiles. Several state profiles of each type of program are presented to provide policymakers
with information that could be helpful in designing new program or modifying an existing program
to improve health care coverage for children.
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Page 5. Innovative State Health Initiatives for Children
Public Programs. The predominant way that states provide public funding for children's health
insurance is through the Medicaid program. The component of Medicaid that is exclusively for
children, the Early and Periodic Screening. Diagnostic, and Treatment (EPSDT) program. provides
eligible children with a comprehensive array of health care benefits. In fact, as a result of federal
expansions to EPSDT authorized by the 1989 Omnibus Budget and Reconciliation Act, states are
required to provide any medically necessary service a child may need to correct or ameliorate a health
problem identified in a screen, whether or not that service is included in the state's Medicaid plan.'
As of February 1995, thirty-four states had exceeded the federal mandate for eligibility for pregnant
women and infants, and eighteen had exceeded the income eligibility requirement for some additional
groups of children. These expansions have been accomplished primarily by disregarding income and
other resources, an option available to states without requesting a waiver, under Section 1902(r)(2) of
the Social Security Act. The primary advantage of expanding eligibility for Medicaid is that federal
matching funds are available to the state for the newly eligible children. The disadvantage of
expanding Medicaid eligibility is that the state must comply with all federal regulations concerning the
benefits package, reimbursement rates, providers, and other features of the program.
Seeking greater flexibility. some states have applied for waivers from the federal program
requirements. 10 Other states have initiated programs to provide children with health insurance funded
entirely with state dollars. Typically, these programs have age and income eligibility criteria that begin
where the state's eligibility criteria for Medicaid end. Three profiles of state-Initiated, publicly funded
programs to provide health insurance for children follow.
Minnesota-MinnesotaCare is 8 state-funded program that provides health coverage to children and
adults statewide. Administered by the department of human services, which is also the state Medicaid
agency. the program serves children between the ages of one and eighteen living in families with
incomes at or below 275 percent of the federal poverty level who are state residents, who do not have
access to employer-subsidized health insurance, and who are not eligible for Medicaid. At the end of
1994, 42,891 children were enrolled in fee-for-service plans across the state. Recently, the state
published a managed care request for proposals. MinnesotaCare is funded through health care
provider taxes and enrollment premiums. and the total budget for the state fiscal year ending June 30.
1994. was $34.2 million.
The average monthly cost per child is $53, including|administrative costs of $5.30 per child. Parents
pay a portion of the monthly premium based upon family size and income. Children at or below 150
percent of the federal poverty level pay $4 per month. The maximum premium is $24 per month for a
single person and $32 per month for a married couple without children. No copayments are required
for any of the health care benefits offered to children under this program.
The comprehensive benefits package includes primary and preventive care (e.g., physician visits,
immunizations. well-child visits, prescription drugs, and vision. dental, and hearing care) as well as
specialty services (e.g., mental health, substance abuse treatment, and physical therapy services).
Nonemergency transportation services are not available, nor is coverage of special education health-
related services provided by school districts. Outreach is conducted through public service
announcements on radio and television. Families applying for MinnesotaCare are referred to
Medicaid, as appropriate, but they are provided sixty days of health coverage to give them time to
apply for Medicaid. Applications are made available in a variety of locations, including state offices,
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schools, Head Start and Special Supplemental Feeding Program for Women. Infants. and Children
(WIC) sites, and community health and social services agencies.
Pennsylvania-The Children's Health Insurance Program (CHIP) provides comprehensive benefits to
40,563 children across the state. CHIP was authorized by the Children's Health Care Act of 1992 and
was implemented the following spring. To quality for the program. children must be a resident of the
state for at least thirty days and be uninsured.
Children between the ages of one and fifteen living in families with incomes below 185 percent of the
federal poverty level who are uninsured and do not qualify for Medical Assistance are provided free
health insurance, while children below age six living in families with incomes between 185 percent
and 235 percent of the federal poverty level are provided subsidies for their insurance. The program is
administered by a management team consisting of the secretaries of health and budget and the
insurance commissioner and is financed through a tax on cigarettes of two cents per pack. Children
receive health care services through a statewide system of managed care and indemnity plans provided
by five regional grantees. The program budget was $21 million in 1994. The average monthly
premium the program pays health plans to cover a single child is $64.13 in the unsubsidized program
and $84.48 in the subsidized program. CHIP pays so percent of the cost of the premiums for the
subsidized group.
A broad array of primary and preventive care services are included in the benefits package. These are
supplemented by dental care, emergency care, hearing care, hospitalization, outpatient surgery,
physical therapy. and vision care. Prescription drugs is the only service requiring a copayment from
the family. Transportation and substance abuse services are not offered to children under CHIP.
When a child is being considered for enrollment in the program, CHIP staff will refer families to
Medicaid and help them by providing instructions and/or mailing completed Medicaid applications. A
family may be required to apply for Medicaid prior toenrolling in CHIP if family income is very close
to Medicald eligibility limits. Outreach efforts are funded through a requirement that grantees match
state dollars with in-kind contributions equal to 2.5 percent of their allotment. Required semiannual
and quarterly reports submitted by grantees indicate that a broad array of community-based and other
resources are mobilized to conduct outreach, including religious organizations/churches, day care
facilities, union and labor groups. county assistance offices, and hospitals and other health care
providers.
Washington-Children below age nineteen living in: families with income below 200 percent of the
federal poverty level are eligible for Basic Health Plan (BHP) Plus. The program. which serves only
children, is jointly administered by the Medicaid agency and the Washington Health Care Authority.
Medicaid and BHP Plus have a joint application process to help ensure that families eligible for
Medicaid have the opportunity to enroll. At the end of 1994, 16.944 children were enrolled in BHP
Plus. The budget for fiscal 1995 was $20.78 million Both federal Medicaid funding and state funds
are used to finance the program.
Children receive services in managed care settings. and the program pays the plans an average of
$61.31 per month for each child covered. The average administrative cost per child of $1.65 is
included as part of this premium. Parents are not required to pay any portion of their child's premium.
and copayments are not required for any BHP Plus services.
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Page 7. Innovative State Health Initiatives for Children
Children are eligible for a comprehensive array of services. Preventive services such as well-child
care and immunizations are covered. as are acute care and specialty services. Public service
announcements are supplemented with mailings and presentations to inform eligible families about the
program.
Public/Privase Partnerships. Increasingly, the public and private health sectors have found mutual
benefits in collaborating to provide and pay for health services. This trend is also reflected in
programs to provide children with health insurance coverage. For example, Iowa, Kansas, Michigan.
and North Carolina have made a financial investment in several of the Caring Programs for Children.
Michigan's Caring Program is actually a demonstration project approved by the Health Care Financing
Administration of the U.S. Department of Health and Human Services and is financed through a
combination of federal and state dollars and foundation funds. Three state models of public/private
partnerships are profiled below.
Colorado-The Colorado Child Health Plan (CCHP) targets children below the age of thirteen who
live in rural counties. 11 To be eligible. the child must be ineligible for Medicaid and live in a family
with income below 185 percent of the federal poverty level. Other family assets cannot not exceed the
following limits: $4,500 for a vehicle; $60,000 for an owner-occupied home; $50,000 for a business;
and $2,000 in personal liquid assets. In 1994, 1,712 children were enrolled in the program. In June
1994. CCHP completed its second year of operation.
The program was authorized by the Children's Health Plan Act in 1990 and amended by additional
legislative action. It is funded through a combination of private donations, modest participant fees.
and a portion of the teaching allowance paid annually by Medicaid to the University of Colorado
Hospital. The program is administered by the Health Sciences Center, which in turn has entered into
an agreement with Blue Cross and Blue Shield of Colorado; Blue Cross and Blue Shield is donating
administrative services as well as claims processing services to the program. Other in-kind
contributions have been made by a variety of corporate partners. pharmaceutical companies, and
community pharmacies.
Health care services provided to children under CCHP are delivered through a managed care system
built upon capitated payment to a network of primary care physicians. Specialty services are
reimbursed through a traditional fee-for-service system, under the direction of the network. The
monthly fee paid to the network covers the provision of well-child care, acute care, chronic care. and
nonacute trauma care. The network can also bill on a fee-for-service basis for services provided
beyond the core primary benefits package. Specialists are paid at the Medicaid reimbursement rate
plus 20 percent. with the exception of laboratory work and radiology. which are reimbursed at the
Medicaid rates.
Cost studies were conducted for the 808 children enrolled in CCHP during fiscal 1994, Overall, the
average monthly capitation fee paid to primary care physicians was $15.05. An additional $8.67 in
claims reimbursement per child was paid monthly. bringing the total average cost per child to nearly
$24. Approximately half of the enrolled children accounted for the additional claims-based costs. An
annual cap on program costs of $7.500 has been instituted.
An extensive outreach campaign includes activities targeted to increasing the number of participating
providers in counties where the program is operational as well as increased enrollment of eligible
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Page S, Innovative State Health Initiatives for Children
families. A wide variety of outreach materials have been developed and distributed. employing user-
friendly language and graphics. Public service announcements are supplemented with newsletters and
collaborative outreach efforts by local human services agencies. Automatic enrollment campaigns
have also been arranged with WIC nutrition programs and the Health Care Program for Children with
Special Health Care Needs by virtue of similar income eligibility and enrollment criteria.
Florida-The Healthy Kids Corporation ACL passed by the legislature in July 1990. authorized the
creation of a nonprofit corporation responsible for administering the Healthy Kids program. Initial
funding, provided by a grant from the Robert Wood Johnson Foundation, was later supplemented by a
four-year cooperative agreement from the federal Health Care Financing Administration as a result of
a proposal submitted by the Medicaid agency. the Healthy Kids Corporation. and the Florida Institute
for Child Heath Policy. The current budget for the program includes $1.7 million in federal Medicaid
funds. $3.9 million in state general revenue, $1.1 million in local government funds, and $2.1 million
in family contributions. Local program sites must contribute a minimum of 5 percent of the cost as a
base. though some have contributed as much as 55 percent.
Using utilization data from similar children served in managed care settings, the Healthy Kids program
was able to negotiate contracts that reflected the associated risk for providers and health maintenance
organizations: the risk financiers include Florida Health Care Plan, Inc.. HIP Health Plan of Florida,
Humana Health Care Plans. and PCA Family Health Plan, Inc. Unlike most employer-based groups,
the resulting premium costs negotiated through this process reflect the reduced cost of providing
health services to a healthy-and therefore relatively inexpensive-group. schoolage children.
According to the Healthy Kids 1995 Annual Report, the cost of providing comprehensive health
insurance to children under the model is less than the cost to provide them with school lunches. 12 The
average monthly cost per child served in Healthy Kids: is $50.
Eligibility for the health insurance coverage provided to children is based upon their enrollment in
school. This unique model has several important advantages. By using school systems as a way to
create a group of participants, the cost benefits that large employers enjoy can be realized. By limiting
coverage to school-age children. the benefits package.can be tailored to meet this population's unique
health needs. Coverage can be offered to all families; in those families with incomes that are high
enough, parents can contribute to the cost of their child's coverage. Some additional benefits may be
realized by including health-related services for children with disabilities or special health care needs
in the benefits package. Because these services must be provided by the school for those children who
are eligible for special education, the local tax burden may be lessened. Finally. offering health
coverage through the school may serve as an incentivelfor children not to drop out." 13
The Healthy Kids benefits package is very comprehensive. It includes a broad array of primary.
preventive. and specialty health care services: substance abuse treatment services are limited to
pregnant teenagers and dental care is optional. Some modest copayments are required. for example.
for emergency room care ($10), mental health services ($10), and prescription drugs ($3). The
coverage has a lifetime cap of $1 million.
Efforts are underway to evaluate the impact of the program. Expansion to additional counties is also
planned. New Hampshire has adopted this model for its state-initiated child health insurance
program, also called Healthy Kids.
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Page 9. Innovative State Health Initiatives for Children
New York-Administered by the commissioner of health. Child Health Plus provides health coverage
to New York State children who are below age fifteen, born on or after June 1, 1980, not eligible for
Medicaid, and without equivalent health insurance coverage. Effective June 1995, children enrolled in
the program prior to age fifteen may remain in Child Health Plus until age sixteen.
Children from households with a gross household income below 222 percent of the federal poverty
level are eligible for subsidization of the premium. Children who are above this income and who meet
other eligibility criteria may enroll in Child Health Plus but without a subsidy. Enrollment began in
August 1991, and by May 1995. more than 100,000 children were enrolled in Child Health Plus:
Each insurer provides the same benefits package, which emphasizes preventive and primary health
care services. Inpatient hospital care is not covered. A small copayment for each prescription and one
for inappropriate emergency room use may be charged.
To better coordinate the Child Health Plus program with Medicaid, the department of health has been
working with the department of social services to develop a joint enrollment form for Medicaid, WIC.
and Child Health Plus. Additionally, legislation enacted in 1993 allocated funds for a comprehensive,
independent evaluation of the program, which is expected to be completed in January 1996.
Caring Programs for Children. The nation's first Blue Cross and Blue Shield Caring Program for
Children was initiated in 1984 by two ministers working in western Pennsylvania. The idea was to
create a program that would provide health coverage to the thousands of unemployed steel workers,
following the collapse of that industry in Pittsburgh in the early 1980s. To address these workers'
concerns that they had lost not only their jobs but also health benefits for their children. the ministers
approached the Western Pennsylvania Blue Cross and Blue Shield plan. The result was the formation
of the Western Pennsylvania Caring Foundation, which sponsors the Caring Program for Children and
serves as the administrator for the state's CHIP program in that region. (The Pennsylvania CHIP
program was modeled after the Western Pennsylvania Caring Program for Children.)
As of the beginning of 1995. Caring Programs are operating in more than twenty states and are serving
more than 120,000 children. 14 One of the unique features of these programs is that children are issued
a standard Blue Cross and Blue Shield Plan identification card, which enables the family to avoid the
possible stigma associated with being poor. Although specific eligibility criteria vary from plan to
plan, all children who are enrolled in Caring Programs share certain characteristics: they live at home
with their families and attend school, if school-age; they are not eligible for public assistance; and they
live in families that cannot afford private health insurance. Because each Caring Program has its own
eligibility requirements and benefits package. several state examples are provided. At times,
children must be put on waiting lists once they are determined eligible for a Caring Program: often the
regional plan will increase fundraising efforts in order.to provide coverage as soon as possible.
Alabama-The Alabama Caring Program for Children began late in 1987, with benefits being
provided to children in March 1988. To be eligible for the program, the child must be age eighteen or
younger; a resident of Alabama; in school, if school-age; not be eligible for Medicaid and have no
private health insurance: and live in a family with an annual income below $9,500. The program is
administered by the Alabama Child Caring Foundation. All administrative costs are donated by Blue
Cross and Blue Shield of Alabama, enabling all of the donations and matching funds to be used to
cover health services for eligible children. The administration of the program costs an average of
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Page 10, Innovative State Health Initiatives for Children
$2.80 per child per month. while the average cost to provide health insurance for a child for a year is
$240. The program served 5,400 children in 1994.
The total amount of donations-from churches, civie organizations, businesses, foundations,
individuals. and an endowment-are matched by Blue Cross and Blue Shield; the 1994 budget
exceeded $1.2 million. In addition, Blue Cross and Blue Shield has contracted with a network of more
than 6,000 doctors and health facilities, and the preferred providers agree to accept the Caring
Program's payment as payment in full. The benefits package includes physician visits, including well-
child care, immunizations, diagnostic testing, and hearing care. Emergency room care and ourpatient
surgeries are also covered.
An evaluation of the impact of the Caring Program on Alabama families was recently conducted. 15
Eighty-one percent of the 207 families that sent back survey responses reported that they now have an
ongoing relationship with a primary care physician that they selected. Prior to enrolling in the
program, one third of these families received their medical care in an emergency room and 40 percent
received health services from a public health clinic. When the program began, some providers were
concerned that this population might overutilize the services because of pent-up demand. With one
exception, this fear did not materialize when utilization rates were examined. Compared with children
enrolled in the regular Blue Cross program. there was increased utilization among children enrolled in
the Caring Program in the treatment for chronic conditions during the first year of enrollment;
specifically, the data showed a higher level of adenoidectomies, tonsillectomies, and insertion of ear
tubes. The executive director attributed this higher utilization to the impact of postponing treatment
for childhood ailments as a result of lack of health insurance and financial barriers to care. The
evaluation study reported a variety of positive side-effects of insurance coverage. including better
school attendance. improvements in academic performance, and increases in children's self-esteem.
Missouri-There are two Caring programs in Missouri. both administered by the Caring Foundation
for Children. One program provides coverage in the thirty-five-county area that is served by Blue
Cross and Blue Shield of Kansas City, and a Caring Program for Children administered by Blue Cross
and Blue Shield in St. Louis serves the rest of the state.
The income eligibility criteria are somewhat higher for the Caring Program that serves families in
Kansas City: to be eligible outside of the Kansas City program area, the income for a family of four
cannot exceed $19,000 per year, compared with $22,212 for the Kansas City program. Another
difference between the programs is the type of provider arrangement. In the Kansas City-based
program, children enroll in managed care plans, while in counties served by the Caring Program
administered by Blue Cross and Blue Shield of St. Louis there is a network of Caring Foundation
participating providers. The average cost per child per year also differs-$200 per year for the St.
Louis-based program, compared with $300 per year for the Kansas City-based program. Similar to
Alabama, the Blue Cross and Blue Shield plans cover the administrative costs of the program.
enabling all private and corporate donations and matching funds provided by Blue Cross and Blue
Shield to be used to pay for health services for children.
In 1994, 775 children below the age of nineteen living in families with incomes at or below 150
percent of the federal poverty level were enrolled in the Kansas City-based program. The total budget
for 1994 was $232,500. The benefits package includes a broad array of services for children.
including well-child visits, physician visits, immunization. prescription drugs, dental care. outpatient
surgery. and diagnostic testing. In the Caring Program affiliated with the St. Louis Blue Cross and
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Page 11. Innovative State Health Initiatives for Children
Blue Shield, 1,500 children were enrolled in 1994 and the budget was $600,000. Well-child care and
other physician visits are covered. as are immunizations, diagnostic testing, outpatient surgery,
emergency care, and substance abuse services. In both programs, parents do not have to pay any
portion of the premium and no copayments for covered services are required. Outreach is conducted
through presentations to community groups, hospitals. and schools. No children are on waiting lists.
Utah-Two programs provide health insurance for children in Utah: the Caring Program for Children
and a high-risk insurance pool for uninsurable children and adults in Utah. Like the Caring Program.
the latter is administered by Blue Cross and Blue Shield of Utah.
The Caring Program, with a 1994 budget of $612,000. provided health insurance coverage to 1,615
children as of December 3, 1994. Sources of funds included individual and corporate donations.
Children across the state are eligible if they live in a family with an income below 150 percent of the
federal poverty level. Children also must be unmarried; in school, if school-age; not eligible for public
or private health plans: and legal residents of the state.
Children are provided health care service through a fee-for-service system. The average monthly
program cost is $32 per child. Parents are not required to pay any portion of the child's premium, nor
are copayments required for any covered services. Physician visits, including well-child visits, are
covered. along with immunizations, hearing care, and outpatient surgery. Emergency care is also a
covered service.
Outreach is conducted through coordination with the schools, focusing on kindergarten through grade
three, and through the use of public health nurses and other community groups. In addition. radio
public service announcements are used to inform eligible families about the Caring Program. Families
that have not applied but may be eligible are referred to Medicaid, as appropriate.
Lessons for State Policymakers
Uninsured children have been provided with health insurance through a number of strategies. These
include expanding eligibility for existing programs such as Medicaid, creating new public and private
programs, and establishing public/private partnerships. Some lessons learned from the NGA survey
may assist state policymakers as they make decisions on improving health care coverage for children.
Children are generally very healthy, and therefore they are not a costly population to provide
health insurance coverage.
Most programs include low-cost preventive health services. such as well-child visits and
immunizations. in their benefits package. In addition to promoting a proactive approach to health
in young children, these services may save additional dollars in acute care services later in their
lives.
Decisions on which strategy to adopt to expand coverage must reflect hard choices concerning
what services to offer and to whom. These decisions are likely to be influenced by the financing
available for the program.
- Although waiting lists are prohibited in Medicaid. they may exist in some of the other
program models. Additional fundraising can be conducted on behalf of children on
waiting lists in order to expand coverage to those children. Enrollment can be capped in a
program funded with state revenues.
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Page 12. Innovative State Health Initiatives for Children
- The comprehensiveness of the benefits package offered to children may also reflect
available financing. The most generous benefits package is that mandated by federal
statute under the EPSDT program. As part of the current Medicaid program, this program
is jointly funded by federal and state dollars and is an unlimited federal entitlement. All
other program models operate under a fixed budget, so that decisions have to be made on
which services to offer enrolled children.
Creating a new public or Caring Program for Children or establishing a public/private partnership
are strategies that maximize a state's flexibility in program design. Federal matching dollars are
currently available for expansions to state Medicaid programs, though state flexibility and
innovation are more limited. An increasing number of states are receiving waivers to increase
their opportunities for program innovation and cost-savings, while maintaining federal financial
participation.
States continue to take the initiative in providing vulnerable populations such as children with needed
health care coverage. This StateLine has highlighted:the innovative efforts of states that have sought
to increase coverage of children by creating new public programs, collaborating with the private sector
to create private programs, and establishing public/private partnerships. Through a mix of public,
private, and collaborative efforts. a significant number of children have gained access to health care
coverage-an important ingredient in producing the next generation of healthy. productive Americans.
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P.15
Table 2
Enrollment and Funding of Children's Health Insurance Programs
1994 Total
Type of
1994
Budger
State
Program
Enrollment
(in millions)
Sources of Funds
Alabama
Caring
5,400
$ 1.25
Corporations. churches, community-based
organizations, foundations. gifts
Arizona
Public
2,300
7.30
State only
California
Public
13,784
71.50
Tobacco HX. subscriber contributions
California
Caring
5,000³
1.2
Businesses, foundations, individuals
Colorado
Public/Private
1.712
0.66
Medicaid teaching allowance, Blue Cross and
Blue Shield
Delaware
Public/Private
8,473
NA
NA
Florida
Public/Private
15,500
8.80
Federal, state. and local funds. family premium
payments
Georgia
Caring
409
NA
Blue Cross and Blue Shield, businesses,
corporations, foundations
Idaho
Caring
400
NA
NA
lows
Caring
2,117
0.36
NA
Kansas
Caring
3,474
0.71
State and private
Louisiana
Caring
412
0.07
Individual/corporate donations, matching funds
Maryland
Public
3,500
0.85
State general revenue, federal Medicaid
Massachusetts
Public
22,021
12.00
State general revenue (23 percent). Health Care
Access Fund
Michigan
Public/Private
3,105
1.40
State general revenue. federal Medicaid,
foundations
Minnesota
Public
42,891
34.20
State only
Mississippi
Caring
1,0276
0.21
Private and matching funds, Blue Cross and Blue
ath
Shield
Missouri
Caring
1,500
0.60
Blue Cross and Blue Shield, donations
Missouri
Caring
775
0.23
Blue Cross and Blue Shield, donations
Nebraska
Public/Private
245
5.00
Assessments from insurance companies: high-risk
pool
New Hampshire
Public/Private
39
0.24
State funds
New York'
Public/Private
98,538
76.50
Bad Debt and Charity Pool
North Carolina
Caring
3.498
1.42
State general revenue, local government. private
Ohio
Caring
5,717
1.55
Fundraising. matching funds. Blue Cross and
Blue Shield
Pennsvlvania
Public
28,923
21.00
Cigarette tax of two cents per pack
Rhode Island
Public
NA
NA
Federal and state Medicaid funds (Section 1115
waiver)
South Dakota
Caring
385
0.18
Maternal and Child Health block grant,
foundations, donations
Tennessee
Public
58.172¹⁰
NA
Federal Medicaid, state. premium payments,
(Section 1115 waiver)
Uesh"
Public/Private
99
2.00
State funds. premium contributions
Utab¹²
Caring
1,615
0.61
Donations. individual and corporate
Virginia
Caring
2,700
NA
NA
Washington
Public
16,944
20.00
Medicaid and Health Services ACT (tax on alcohol.
tobacco, and providers)
Wisconsin
Private¹³
80014
NA
Family premium payments
Note: NA indicates data are not available.
See Notes to Table 2.
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P.16
Notes to Table 2
Notes:
1 California Access for Infants and Mothers program.
2 CaliforniaKids program.
3 CaliforniaKids program eurollment figures current as of July 1, 1995.
4 Maryland figures as of June 1995.
5 Massachusetts enrollment figures as of March 31, 1995.
6 Mississippi enrollment figures as of May 8, 1995.
7 Caring Foundation for Children. St. Louis, Missouri.
8 Caring Foundation for Children, Kansas City, Missouri.
9 New York enrollment figures as of April 1995; budget for 1995.
10 Tennessee enrollment figures are for children ages one to thirteen.
11 Utah Health Insurance Pool.
12 Utah Caring Program for Children.
13 The Youth Med program, administered by Blue Cross and Blue Shield United of Wisconsin, is not
considered a Caring Program for Children.
14 Wisconsin enrollment figures current as of June 30, 1995.
Source: National Governors' Association, July 1995.
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Table 3
Costs, Premiums. and Cost Sharing in Children's Health Insurance Programs
Average Cost per Child
Average Premium per
Family Contributes 10
State
per Month
Month
Premium
Alabama
$20
0
No
Arizona
$91; espitated
No
California¹
[2]
Yes3
California
$28
$33
No
Colorado
$23
$2
Yes
Delaware
$71
Yes5
Florida
$50
$43
Yes6
Georgia
Idabo
No
lows
$26
0
No
Kansas
$17
$17
No
Louisiana
$20
0
No
Maryland
20
No
Massachusetts
$70
$70
Yes'-
Michigan
$35
No
Minnesota
$53
0
Yes8
Mississippi
$20
0
No
Missouri
517
0
No
Missouri¹⁰
$25
0
No
Nebraska
$50-$180
$50-$180
Yes
New Hampshire
$52
$52
Yes
New York
$55
$55
Yes11
North Carolina
$22
$22
No
Ohio
$19
$19
No
Pennsylvania
579
Yes12
Rhode Island¹³
$130
$112
Yesi4
South Dakota
0
No
Tennessee
Yesis
Utah¹⁶
$171-$192
0
Yes
Utah¹⁷
$32
0
No
Virginia
$29
0
No
Washington
$61.31
No
Wisconsin
$60
$60
Yes
Note: Cost figures include administrative costs.
See Notes to Table 3.
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P.18
Notes to Table 3
Notes:
1 California Access for Infants and Mothers program.
2 In the California Access for Infants and Mothers program. $10.000 is the average cost per child and
mother; coverage is for pregnant women plus sixty days of postpartum care and for children up 9
age two.
3 In the California Access for Infants and Mothers program. families contribute 2 percent of their
gross annual income.
4 CaliforniaKids program.
5 In Delaware only aon-Medicaid-eligible families contribute.
6 In Florida families contribute on 3 sliding-fee scale.
7 In Massachusetts families contribute on a sliding-fee seale: families with incomes berween 200
percent and 400 percent of the federal poverty level pay $15 per child per month up to $45 per
family per month.
8 In Minnesota families contribute on a sliding-fee scale based upon income and family size.
9 Caring Foundation for Children. St. Louis, Missouri.
10 Caring Foundation for Children. Kansas City, Missouri.
11 la New York families contribute if their income is above 160 percent of the federal poverty level.
12 In Pennsylvania children below age five are subsidized by the state.
13 Cost and premium figures for Rhode Island figures reflect the entire population served under the
state's Section 1115 waiver.
14 In Rhode Island families contribute 3 percent of the premium if their income is between 185 percent
and 250 percent of the federal poverty level.
15 In Tennessee non-Medicaid-eligible families contribute if their income is at or above 100 percent
of the federal poverty level.
16 Uub Health Insurance Pool.
17 Utah Caring Program for Children.
Source: National Governors' Association. July 1995.
Table 4
Eligibility Criteria for Children's Health Insurance Programs
08/09/96
Not Eligible for
Children
In
Private
State
only
Ages
Income Below
Resident
School
Uninarried
Medicaid
Insurance
Alabama
Yes
18 and below
$9,500
Arizona
Yes
below 13
below 2
MAY 30 '96 10:57AM IHCRP
12:51
[1]
California
No³
200%-250% of FPL4
California³
Yes
2-18
100%-200% of FPL
Colorado
Yes
0-13
185% of FPL⁶
Delaware
Yes
0-1/1-5/
185% of FPL/133% of FPL
6-19
100% of FPL
7321 20202 101
Florida
Yes
5-19
Sliding scale
Georgia⁷
No
none
100% of FPL
Georgia®
Yes
1-18
150% of FPL
Idaho
Yes
0-15
150% of FPL
lowa
Yes
0-19
133% of FPL
Kansas
Yes
0-18
133% of FPL
Louisiana
Yes
0-18
100% of FPL
Maryland
Yes
1-6/6-11
1.13%-185% of FPI/
100%-185% of FPL
Massachuretts
Yes
0-12
Not applicable
Primary/preventive only
Michigan
Yes
up to 19
185% of FPL
ASPE/HP SHH
Minnesota
No
1 to 18
275% of FPL
Mississippi
Yes
up to 19
100% of FPL
Missourito
Yes
below 19
$13,000 for family of two
Missourill
Yes
below 19
150% of FPL
Nebraska
No
none
Uninsurable
New Hampshire
Yes
3-18
Uninsured for three months
New York
Yes
below 15
(12)
North Carolina
Yes
0-19
185% of FPL
Ohio
Yes
6-18
133% of FPL
Living with parent
Pennsylvania
Yes
1-15
185% of FPL
Rhode Island
No
0-6
250% of FPL
South Dakota
Yes
6-19
133% of FPL
Living at home
Tennessee
No
0-21
[13]
Viah¹⁴
No
none
High-risk uninsurable
Utah¹⁵
Yes
01-19
150% of FPL
P.19
Virginia
Yes
I-19
200% of FPL
Washington
Yes
0-19
200% of FPL
Wisc
in
Yes
0-23¹⁶
Not applicable
017/031
Note: FPL means federal
crty level.
See Notes to Table 4.
Notes to Table 4
96/60/80
Notes:
1 In Arizona children ages thirteen and younger are eligible if they have received food stamps or exceed state medically needy/medically indigent levels but do notes
exceed federal poverty guidelines.
2 California Access for Infants and Mathers program.
3 In California's Access for Infante and Mothers program, women who are less than thirty weeks pregnant are also covered.
4 In California's Access for Infants and Mothers program, family income must be above 200 percent of the federal proverty level and at or below 250 percent of the
federal poverty level.
MAY '96 10:57AM IHCRP
12:51
5 CalifornisKids program.
6 In Colorado assets are limited for automobile. business, home, and personal costs.
7 Georgia Caring Program for Children.
8 Georgia Partnership for Caring Foundation.
9 In Maryland children ages six through eleven must have been born before September 30, 1983.
10 Caring Foundation for Children, SI. Louis, Missiouri.
6202 401 7321
11 Caring Foundation for Children. Kansas City. Missouri.
12 In New York premiums for children in families with incomes below 160 percent of the federal poverty level are fully subsidized; premiums for children in families
with incomes between 161 percent and 222 percent of the federal poverty level are subsidized 50 percent; and premiums for children in families with incomes above
222 percent of the Federal poverty level are paid in full by the parents.
13 In Tennessee eligible participants must be uninsured or unimaurable.
14 Utah Health Insurance Pool.
15 Utah Caring Program for children.
16 In Wisconsin children are eligible up to age twenty-three if they are students and are enrolled in the program prior to age nineteen.
Source: National Governors' Association, July 1995.
ASPE/HP SHH
P.20
018/031
Table 5
Services Covered by Children's Health Insurance Programs
96/60/80
Dental Care
Diagnostic Testing
Emergency Care
Hearing Care
Hospitalization
Immunizations
Mental Health
Outpatient Surgery
Physical Therapy
Physician Visits
Prescription Drugs
Substance Abuse
Transportation
Vision Care
Well-Child Visits
MAY 30 '96 10:57AM IHCRP
12:52
State
Alabama
Arizona
California'
.
California'
.
20202 401 7321
Colorado
Florida
3
Georgia
Georgia⁶
Idaho
Iowa
Kansas
Louisiana
Maryland
Massachusetts
(7)
Michigan
HHS ASPE/HP
Minnesota
Mississippi
Missouri®
Missouri⁹
Nebraska
New Hampshire
New York
North Carolina
Ohio
Pennsylvania
Rhode Island
South Dakota
Tennessee
Uiah"
-
P.21
Utah"
Virginia
Washington
019/031
Wisconsin
See Notes to Table 5.
Notes to Table 5
Noles:
1 California Access for Infants and Mothers program.
96/60/80
2 CaliforniaKids program.
3 In Florida dental care is an optional service.
4 In Florida substance abuse treatment is available only to pregnant teenagers.
5 Georgia Partnership for Caring Foundation.
6 Georgia Caring Program for Children.
MAY 30 '96 10:58AM IHCRP
12:52
7 In Massachusetts the only surgical procedures covered are those for inquinal hemia and car tubes.
8 Caring Foundation for Children, SI. Louis, Miseouri.
9 Caring Foundation for Children, Kansas City, Miasouri.
10 Utah Health Insurance Pool.
11 Utah Caring Program for Children.
Source: National Governors' Association, July 1995.
20202 7321 401
HHS ASPE/HP
P.22
020/031
08/09/96
12:52
202 401 7321
HHS ASPE/HP
021/031
MAY 30 '96 10:58AM IHCRP
P.23
Types of Health Plans Offered for Children
Managed Care
Fee for service
Managed Care and Fee for service
Others
Note:
= Other indicates that a different type of arrangement is in place, for example. a preferred provider
organization.
Source: National Governors' Association. July 1995.
08/09/96
12:53
202 401 7321
HHS ASPE/HP
1
022/031
MAY 30 '96 10:58AM IHCRP
P.24
ALABAMA
Caring Program for Children
Covered Services
Diagnosic resting emergency care, hearing care. immunizations
outpatient surgery, physician visits, and well-child visits.
Copayments
None.
Caps or Limitazions
None.
ARIZONA
Children's Care Program
Covered Services
Dental care, diagnostic reging, emergency care hearing care,
hospitalization, immunizations mental health, outparient surgery,
physical therapy, physician visits prescription drugs, subscance abuse,
transportation, vision care, and well-child visits
Copayments
None.
Caps 07 Limitations
None.
CALIFORNIA
Access for Infants and Mothers
Covered Service
Diagnosic testing, emergency care, hearing care. hospitalization.
Immunizations mental health outpatient surgery, physical therapy,
physician visits prescription drugs. and substance abuse.
Copayments
None.
Caps or Limitations
Mental health services are limited to ten inparient days and twenty
outpatient visies per year. Physical therapy is available only for acute
conditions on a short-term basis Substance abuse services are limited
to detoxification. Transportation is provided only on an emergency
basis.
CaliforniaKids
Covered Services
Diagnostic testing emergency care, hearing care, immunizations
mental health. outpatient surgery. physical therapy, physician visits,
prescription drugs vision care, and well-child visits.
Copayments
A $5.00 copayment is required per office visit, This copayment covers
all services performed during the office visit, including laboratory and
diagnosic texts hearing screenings. and immunizations. A $25.00
copayment is required if emergency room care is not an emergency.
A $5.00 copayment may also be required for outpatient surgery and
physical therapy. The copayment for prescription drugs is either $5.00
or $10.00. Vision care requires a $10.00 copayment.
Caps or Limitations
Vision care is limited 5 one office visit per year.
08/09/96
12:53
202 401 7321
HHS ASPE/HP
023/031
MAY 30 '96 10:59AM IHCRP
P.25
COLORADO
Child Health Plan
Diagnostic testing emergency an hearing care, immunizations,
ourpatient surgery, physical therapy, physician visits. prescription
drugs, vision are, and well-child visits.
Copayments
A $2.00 copayment is required for emergency care physician visits
prescription drugs vision are and well-child visirs.
Caps or Limitasions
Overall, coverage is limited by an annual ap of $7,500.
FLORIDA
Healthy Kids
Covered Services
Dental are, diagnostic testing, emergency care. hearing care,
hospitalization, immunizations mental healch, ourparient surgery,
physical therapy, physician visits, prescription drugs, substance abuse,
vision care, and well-child visits. Other covered services include home
health are and transplants.
Copayments
Dencal care, which is 27 optional service requires a $3.00 copayment.
For emergency care and mental health services. a $10.00 copayment is
charged. Copayments for physician visits and vision are can vary,
from none to $3.00, and from $3.00 to $10.00, respectively. A $3.00
copayment is collected for prescription drugs.
Caps 07 Limitations
Mental health services are limited to fifteen inpatient days and
twenty-one outpatient visits per year. Substance abuse treatment is
available only to pregnant teenagers. There is a lifetime cap of
$1 million in coverage per child.
GEORGIA
Partnership for Caring Foundation
Covered Services
Dental are, diagnostic testing, hearing care, hospitalization.
immunizations merical health. ourpatient surgery, physical therapy,
physician visits, prescription drugs. transportation, vision are, and
well-child visits
Copayments
None.
Caps or Limitations
None.
Caring Program for Children
Covered Services
Diagnosic resting emergency care, hearing care, immunizacions,
outparient surgery, physician visies, prescription drugs, vision care, and
well-child visits
Copayments
A $3.00 copayment is required for prescription drugs
Caps or Limitations
Coverage of diagnostic testing, hearing are, and well-child visits is
limited to preventive care services.
08/09/96
12:53
202 401 7321
HHS ASPE/HP
4.
024/031
MAY 30 '96 10:59AM IHCRP
P.26
IDAHO
Caring Program for Children
Covered Services
Emergency are. physician visits, and prescription drugs
Copayments
None.
Caps or Limitations
None.
IOWA
Caring Program for Children
Covered Services
Diagnoszic testing emergency are, immunizations, outpatient
surgery, physician visio, and well-child visits
Copayments
None.
Caps or Limitarions
None.
KANSAS
Caring Program for Children
Covered Services
Diagnostic testing, emergency care, hearing are, hospitalization,
immunizations mental health, outpatient surgery. physician visits,
subsance abuse, vision care. and well-child visits.
Copayments
None.
Caps or Limitations
There is a limit of four visits to the emergency room and four
inpatiens days of hospitalization. Physician visits, including well-child
visits, are limited to rwelve per year. Mental health services include
coverage for substance abuse treatment but only on an outpatient basis
LOUISIANA
Caring Program for Children
Covered Services
Diagnosic testing emergency care, immunizations, ourpatient
surgery, physician visits, and well-child visits
Copayments
None.
Caps or Limitarions
Emergency care is covered up to four times per year. Ourparient
surgery is covered on an emergency basis, and it is also provided for up
10 six elective episodes. One well-child visit per year is covered, up to
$150.
08/09/96
12:54
202 401 7321
HHS ASPE/HP
025/031
r.cr
MAY 30 '96 10:59AM IHCRP
MARYLAND
Kids Count
Covered Services
Diagnostic testing emergency are. hearing care, immunizations
mental health, outpatient surgery, physical therapy, physician visirs,
prescription drugs substance abuse, vision oic, and well-child visits.
Copayments
A $5.00 copayment is required for prescription drugs
Caps or Limitations
Diagnostic testing, emergency eare, and outpatient surgery are
provided in hospitals Substance abuse is covered only as part of the
mental health benefit. Vision are is limited to one pair of eyeglasses
per year.
MASSACHUSETTS
Children's Medical Security Plan
Covered Services
Diagnosic testing emergency care, hearing are immunizations
mental health outparient surgery, physician visits prescription drugs,
vision are, and well-child visits
Copayments
Copayments vary from $1.00 to $5.00 for diagnosic testing,
emergency care. hearing care, mencal health, ourpatient surgery.
physician visirs and vision care. Prescription drugs are subject to a
copayment that ranges from $3.00 B $4.00.
Caps 07 Limitations
Coverage for emergency are is limited to $1,000 per year. Mental
health benefits are limited 9 thineen outpatient visits per year. A
maximum of $100 in coverage for prescription drugs is provided.
Vision care is available only if medically necessary.
MICHIGAN
Caring Program for Children
Covered Services
Diagnosic resting emergency care, immunizations, outpacient
surgery, physician visits, prescription drugs, substance abuse,
transportation. and well-child visits.
Copayments
A copayment of fifty cents is charged for prescription drugs.
Caps or Limitations
Coverage for substance abuse treatment is limited.
08/09/96
12:54
202 401 7321
HHS ASPE/HP
026/031
MAY 30 '96 11:00AM IHCRP
MINNESOTA
Minnesota Care
Covered Services
Dental are. diagnostic ressing, emergency care, hearing care,
hospitalization. immunizations, mental health, outparient surgery,
physical therapy, physician visits prescription drugs. substance abuse,
transportation, vision care, and well-child visirs
Copayments
None.
Caps or Limitations
Hospitalization is covered up to $10,000 per year Mental health
services and prescription drugs are subject to the same coverage
provisions as in the Medicaid program. Transportation services are
covered only in an emergency. Vision care is provided through 2 state
contract.
MISSISSIPPI
Caring Program for Children
Covered Services
Diagnosic testing, emergency are, immunizations, outparient
surgery, and physician vision.
Copayments
None.
Caps or Limitarions
None.
MISSOURI
Caring Foundation for Children-St. Louis
Covered Services
Diagnosic testing emergency care, immunizations, outpatient
surgery, physician visits, substance abuse. and well-child visits
Copayments
None.
Caps or Limitations
None.
Caring Foundation for Children-Kansas City
Covered Services
Denal are, diagnostic ressing, emergency care immunizations,
ourparient surgery. physician visits prescription drugs, and well-child
visits
Copayments
None.
Caps or Limitations
None.
08/09/96
12:54
202 401 7321
HHS ASPE/HP
027/031
P.C3
MAY 30 '96 11:00AM IHCRP
NEBRASKA
Comprehensive Health Insurance Pool
Covered Services
Dental care, emergency care, hearing are, hospitalization, mental
health. outpatiens surgery. physical therapy, physician visits,
prescription drugs and substance abuse.
Copayments
An unnual deductible must be met, and then coinsurance of 20
percent is the responsibility of the family for emergency are
outpatient surgery, physical therapy. and physician visits. For mental
health and subsance abuse services. the coinsurance is 50 percent. No
copayment is required for generic prescription drugs.
Caps or Limitations
The lifetime benefits are capped at $500,000. For mental health and
substance abuse services, benefits are apped at $25,000. Coverage for
dental care is limited 10 treatment of temporal mandibular joint
disorder.
NEW HAMPSHIRE
Healthy Kids
Covered Services
Diagnostic testing emergency are, hearing are, hospitalization,
immunizations mental health, outpatient surgery, physical therapy,
physician visits prescription drugs, vision care, and well-child visits
Copayments
A $10.00 copayment is required for hearing and vision care and
mental health services. A $25.00 copayment is required for emergency
care if the primary care physician did not make 2 referral. A $5.00
copayment is required for physical therapy, physician visits, and
prescription drugs
Caps or Limitarions
None.
NEW YORK
Child Health Plus
Covered Services
Diagnosic testing, emergency care. immunizations, outpatient
surgery, physical therapy. physician visits prescription drugs. substance
abuse, and well-child visits.
Copayments
A $35.00 copayment is charged for inappropriate use of the
emergency room. Prescription drugs require a copayment ranging
from $1.00 to $3.00.
Caps or Limitarions
Substance abuse treatment services are limited to sixty visits per year,
and family therapy is limited to twenty visits per year.
08/09/96
12:54
202 401 7321
HHS ASPE/HP
4.
028/031
MAY 30 '96 11:00AM IHCRP
NORTH CAROLINA
Caring Program for Children
Covered Services
Diagnostic testing emergency are, hearing are immunizations,
outpatient surgery. physician visits and well-child visits.
Copayments
None.
Caps or Limitations
None.
OHIO
Caring Program for Children
Covered Services
Diagnozic testing hearing care, immunizations, outpatient surgery,
physician visits prescription drugs, and well-child visits
Copayments
A $3.00 copayment is required for prescription drugs
Cap OF Limitations
Only routine hearing care is covered.
PENNSYLVANIA
Children's Health Insurance Program
Cevered Services
Dental are. diagnostic tessing, emergency care, hearing care,
hospitalization, immunizations, mental health. outpatient surgery.
physical therapy, physician visits prescription drugs, vision care, and
well-child visits
Copayments
Prescription drugs require a $5.00 copayment.
Caps or Limitations
None.
RHODE ISLAND
RiteCare
Covered Services
Dental care, diagnostic resing, emergency are hearing care.
hospitalization, immunizations. mental health. ourpatient surgery,
physical therapy. physician visits prescription drugs, substance abuse,
transportation, vision care, and well-child visits
Copayments
Hospitalization requires a $25.00 copsyment. A $15.00 copayment is
required for outpatient surgery. A $5.00 copayment is charged for
physician visits except for prenatal or preventive care. Prescription
drugs are subject to 2 $2.00 copsyment.
Caps or Limitarions
Hospitalization is limited a fifteen days for mental health and
substance abuse treatment. Outpatient mental health and substance
abuse services are limited to eventy visits per year.
08/09/96
12:55
202 401 7321
HHS ASPE/HP
029/031
P.31
MAY 30 '96 11:00AM IHCRP
SOUTH DAKOTA
Caring Program for Children
Covered Services
Diagnosic cesring emergency are, hospitalization, immunizations,
outpatient surgery. physician visits and well-child visits.
Copayments
None.
Caps or Limizarions
Diagnostic testing is limited to specific procedures. such as radiology
services and laboratory less
TENNESSEE
TennCare
Covered Services
Dental are, diagnostic testing. emergency care. hearing care.
hospitalization, immunizations mental health, outpatient surgery,
physical therapy, physician visirs prescription drugs, substance abuse,
transportation, vision care. and well-child visits.
Copayments
No copayments are required for families with incomes below 100.
petcent of the federal poverty level, for Medicaid-eligible families. or
for preventive services For families between 101 percent and
199 percent of the federal poverty levd. there is a graduated scale for
copayments. For families above 200 percent of the federal poverty
level, 1 copayment of 10 percent of the cost of the service is required.
Caps or Limitarions
In general, coverage is provided for services deemed medically
necessary. Coverage for inpatient substance abuse treatment is subject
to a lifetime limitation of two treatment programs no longer than
twenty-eight days each plus two five-day detoxifications. A forry-five
visit annual limit on outparient mental health services is imposed on
all participants except those who are chronically mentally ill.
Nonemergency transportation services are provided only as necessary
for enrollees lacking accessible transportation to covered services.
UTAH
Health Insurance Pool
Covered Services
Diagnostic testing emergency care, hospitalization, immunizations
mental health, outpatient surgery, physical therapy, physician visits,
prescription drugs substance abuse, and well-child visits
Copayments
A 20 percent copayment is required for all covered services.
Caps or Limitasions
Coverage for mental health and substance abuse services is limited.
08/09/96
12:55
202 401 7321
HHS ASPE/HP
030/031
MAY 30 '96 11:01AM IHCRP
P.32
Children
Diagnosie resting emergency are, hearing are, immunizations
ourpatient surgery. physician visits substance abuse, transportation,
vision care, and well-child visits
None.
ions
In lieu of coverage for prescription drugs a 10 percent discount is
offered to enrolled families through a designated pharmacy. Some
ambulance care is covered as part of the transportation benefit. and
some vision are is donated by providers
GINIA
Caring Program for Children
Covered Services
Dental care, diagnosic testing, emergency care. immunizations.
mental health. ourpatient surgery, physician visits, prescription drugs.
and well-child visies
Copayments
Prescription drugs require a $3.00 copayment per prescription.
Caps or Limitations
Denal care is limited 9 preventive and diagnosic services Use of the
emergency room is limited to twice per year Mental health services are
limited to six counseling visits persyear. Ourpatient surgical procedures
that are covered include the removal of consils and adenoids, repair of
hernias, insertion of are tubes, and repair of broken bones. Coverage
for prescription drugs is limited to $500 per year.
WASHINGTON
Basic Health Plan Plus
Covered Services
Dental are, disgnostic tesing, emergency care. hearing are,
hospitalization. immunizations. mental health, ourpatient surgery,
physical therapy. physician visits prescription drugs. substance abuse,
transportation. vision are, and well-child visits
Copeyments
None.
Caps or Limitarions
None.
08/09/96
12:55
202 401 7321
HHS ASPE/HP
031/031
P.33
MAY 30 '96 11:01AM IHCRP
WISCONSIN
Youth Med
Covered Services
Diagnostic testing, emergency are, hearing care, hospitalization,
immunizations, outpatient surgery, physical therapy, physician visits.
prescription drugs, and well-child visits
Copayments
After a $250 deductible, a 20 percent copayment is required for all
covered services except immunizations and well-child visits and except
for preventive are offered as part of disgnostic cessing and physician
visits A copayment of $5.00 is required for generic prescription drugs
and $10.00 for brand-name prescriptions.
Caps 07 Limitations
Coverage of preventive physician visits is limited to $125 per year.