With more federal help on the way through the economic recovery program and the reauthorization of the federal Children's Health Insurance Program (CHIP), states have a new incentive to enroll more eligible kids in public health insurance programs.
There is no question state lawmakers are in a bind, with most having just closed deep budget gaps in FY 2009 and looking to close even larger gaps for FY 2010. But the same recession that is putting their fiscal back to the wall also means a growing number of parents and children are without medical coverage.
Many of these children are eligible, but their parents don't know it because they've never before needed this type of public help. States and the federal government are pushing efforts to get the word out to parents that coverage is available.
California learned the importance of outreach in tough economic times during the 2001-2003 economic downturn. The state increased eligibility levels and simplified enrollment procedures for Medicaid and the Children's Health Insurance Program. Enrollment did not grow as expected, however, because the state cut its budget for outreach and stopped supporting community-based application assistance.
Under the federal economic recovery act, a 6.2 percent increase in federal matching funds for Medicaid programs through 2010 will help states cope with higher enrollment. In states with especially high unemployment, even more federal Medicaid assistance is available. To receive these funds, states must allow any child to enroll who was eligible under its standards in July 2008. Put simply, states cannot cut eligibility for Medicaid if they accept assistance under the recovery act.
The reauthorization of the Children's Health Insurance Program is expected to provide coverage for an additional 4.1 million children by 2013, using $33 billion in federal funds.
None of this federal money is free. Both programs require state matching money. To help, the insurance program reauthorization set up a contingency fund for states that face shortfalls because of increased enrollment. To qualify, states must surpass target enrollment levels.
CHALLENGE TO STATES
With this silver lining--and some cash assistance to go with it--states have the opportunity to begin enrolling the nearly 9 million children under age 19 who were uninsured before the recession and the newly eligible ones whose parents are recently unemployed.
Each percentage point increase in the national unemployment rate sends state revenues down 3 percent to 4 percent, swells the ranks of Medicaid and the Children's Health Insurance Program by 1 million and increases the uninsured by 1.1 million, according to the Kaiser Family Foundation.
"The economic tendency [in a recession] is to push people out of coverage," says Maryland Delegate Dan Morhaim. "We're working to stem that tide and cover as many kids as we can."
Morhaim, who is an emergency room doctor, knows what happens when people don't have access to health care. "When people don't have primary care, we see them when they are sicker and their conditions are more expensive to treat."
The harsh reality for some states is that the resources simply aren't there to cover more kids. Last year California, which had to close a $42 billion budget gap for FY 2009 and FY 2010, changed enrollment procedures and required people to submit MediCal renewal forms every six months instead of annually. That change may leave 260,000 children without health care coverage by 2011. California probably will have to roll back the changes to receive the increased Medicaid funds.
The twist, however, is that even with cutbacks, about 70 percent of uninsured children nationally are eligible but not enrolled for public insurance programs. As of January 2009, Medicaid and the Children's Health Insurance Program were available to kids in families with incomes at or above 200 percent of the federal poverty guidelines in 43 states and the District of Columbia. That amounts to about $44,000 for a family of four.