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Volume 27, Issue 464 |
April 3, 2006 |
ILLINOIS SETS ITS SIGHTS ON COVERING “ALL KIDS”
When Illinois passed legislation last fall (HB 806) to provide health insurance to all children in the state, it set a new standard. A growing number of states are seeking to expand coverage to children, but Illinois is the only one so far to have set in motion a program to cover “All Kids” (not coincidentally, the name of the program).
Slated to begin July 1, All Kids is aimed at expanding coverage to children in families that earn too much to qualify for Medicaid or the State Children’s Health Insurance Program (SCHIP), but too little to be able to afford policies in the private sector. “Our plan is based on a very simple principle: Everyone needs health care, and every child should have a way to get the care they need,” said Gov. Rod Blagojevich, who proposed the program.
An estimated 253,000 Illinois children lack coverage, with nearly three-quarters of them coming from families with household incomes between $40,000 and $80,000 a year. Under All Kids, families with uninsured children will be able to purchase coverage with premiums and co-pays based on income. A family of four, for example, that earns $40,000 to $59,000 a year would pay $40 per month per child and $10 per doctor visit. Benefits in All Kids would be identical to those available under KidCare (the state’s combined Medicaid and SCHIP program), with the exception that All Kids will not pay for non-emergency transportation. No co-pays will be charged for well-baby or well-child visits.
Critics of the legislation worry that it will undercut policies offered by the private sector, and some charged that it was a politically motivated move by Blagojevich, who is up for reelection in November. “Just another press release opportunity,” Sen. William Peterson told The Heartland Institute. He noted that Blagojevich’s press packet for All Kids contained 7,800 words while the legislation has only 2,200 words – “and almost no details.”
But proponents say the expansion is needed. “There are currently over 250,000 children in Illinois who do not receive proper health care because their families cannot afford health insurance for them,” said Rep. Michelle Chavez. “This is nothing short of a travesty and a shame. If a child is sick and needs to see a doctor, that child should be able to go see a doctor without his parents having to worry about how they can possibly afford to pay for it.”
“It’s all about access to affordable health care,” said Kathleen Strand, spokeswoman for the Illinois Department of Healthcare and Family Services. “A lot of low-income people work two jobs. If you’re working hard and playing by the rules, you should be able to provide health-care to your children.”
Reaching Out
Since 1997, Medicaid and SCHIP have been largely responsible for reducing the national uninsured rate of low-income children by one third – from 23 percent to 11 percent. Still, some 9 million children remained without coverage. The costs of uninsurance are high. Researchers have found that children who lack coverage are much more likely than insured kids to go without needed medical care. Uninsured kids also tend to miss more days of school and are at higher risk for emergency department visits and hospitalization.
With the recession of the early 2000s behind them, a growing number of states are considering measures to expand coverage to the uninsured, said Cindy Mann, executive director of the Center for Children and Families at Georgetown University’s Health Policy Institute. Many are seeking to cover children, who are not only generally less expensive to cover than adults but are a politically popular target. One of the advantages of focusing on children is that “the kids that still remain to be covered are not the real costly kids, so it’s not as big an investment of expenditures as it might otherwise be,” Mann said.
Details Emerging
All Kids can be considered an expansion of the KidCare. Eventually, the name KidCare will be phased out and All Kids will become the rubric for all Illinois public health coverage programs for children.
To help subsidize the low premiums, state officials plan to seek a waiver from the Centers for Medicare & Medicaid Services to move all Medicaid enrollees (except for the blind and nursing home residents) into a primary-care case management (PCCM) program. PCCM programs pay physicians on a fee-for-service basis and add a small monthly payment (in All Kids’ case, of $3-$5 per child) to manage the care for a child. Twenty-nine states are using PCCM to both improve the quality of care and save money, largely by reducing the duplication of services, said Strand. The state also plans to incorporate disease management for the chronically ill into public programs.
State officials estimate that, in the first year, they’ll extend coverage to 50,000 children at a cost of $45 million, roughly 75 percent of which will be paid for by the premiums and co-pays paid by enrollees. The state also expects to save $56 million in the first year through PCCM. “We’re more than paying for it in the first year,” said Stand. “We’ve got $11 million left over.”
The fact that All Kids will pay Medicaid fee-for-service rates to providers has engendered “considerable skepticism” in the physician world about whether the program will do much to actually increase access to care for low-income Illinoisans, according to Dr. Craig Backs, president of the Illinois State Medical Society. Some Medicaid enrollees already have a difficult time finding physicians who accept Medicaid because its payment rates are “ridiculously below the costs of providing care,” he said. He estimates that the costs of providing medical care in the state have increased by 47 percent over the past 12 years, while Medicaid payments have increased by only 11 percent over the same time.
“We have been supportive of expanding coverage to uninsured Illinoisans, and starting with children is a reasonable and laudable goal,” Backs said. “But we feel it’s very important to recognize that it’s no good to have a symbolic form of access that does nothing to actually provide care.”
The All Kids bill notes that when it’s “cost-effective” the state may, instead of enrolling children in All Kids, offer families subsidies toward the cost of employer or other privately sponsored health insurance. This provision is supported by Blue Cross and Blue Shield of Illinois, which offers policies to children at a “fairly favorable price comparison,” according to a spokesman. “We’re all in pursuit of the same goal,” he said. “Our concern going forward is that we don’t cannibalize the private market, which offers reasonably price alternatives.”
In an effort to avoid “crowd out” (or having families drop their private coverage in favor of the government program), All Kids initially will require that enrollees have been uninsured for at least six months. That uninsured period will eventually be lengthened to a year.
Open Doors
One of the benefits to All Kids is that it’s exactly that, advocates say: open to all kids under the age of 19, including undocumented children and state employees’ children, who are currently not eligible for KidCare. This broad net should help bring in not only those children, but also the hard-to-reach kids who qualify for KidCare but whose parents haven’t applied because of doubts about their eligibility. “The message of All Kids as a source of coverage will eliminate a lot of the question marks and bureaucracy of finding eligible but unenrolled kids,” Mann said. “So it will have a real spillover effect on the kids who are already eligible.”
Research backs up this point, she added. In 2001, a coalition of community organizations, county agencies and the local Medicaid plan in Santa Clara County, California, launched the Children’s Health Initiative (CHI). Designed to improve the health and well-being of low-income children in the county, CHI’s insurance product – Healthy Kids – covers children who are ineligible for the state’s Medicaid and SCHIP programs. A 2005 evaluation of the program by Mathematica Policy Research Inc. found that CHI led to large enrollment increases in both the state Medicaid and SCHIP program.
“CHI fundamentally changed the outreach message to Santa Clara families with uninsured children,” a Mathematic researcher wrote. “The idea is now simple and direct – your children will receive health insurance if you apply. The change appears to have reduced confusion over program eligibility, a factor long identified as a major barrier to increasing Medi-Cal and Healthy Families enrollment.”
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OTHER STATES, OTHER EXAMPLES
Illinois is not the only state seeking to expand coverage to children.
- In 2005, the Washington Legislature passed legislation adopting the goal that the state will cover all of its children by 2010. In 2006, the Legislature moved toward that goal by passing HB 2376, which repealed the authority of the Department of Social and Health Services to charge premiums for children in Medicaid and other state-sponsored health-care programs. No premiums may be charged for children in households with incomes at or below 200 percent of the federal poverty level. In 2003, lawmakers authorized the state to charge premiums to Medicaid enrollees, but that authority has never been used. Premiums can make coverage prohibitively expensive for low-income families, the bill notes.
- In March, the West Virginia Legislature unanimously approved HB 4021, which expands state SCHIP eligibility from 200 percent to 300 percent of the federal poverty level. It’s estimated the legislation will increase the number of children who can be enrolled in SCHIP by up to 4,300. That would leave only 800 children in the state without coverage, Delegate Don Perdue told the Huntington Herald-Dispatch. “It’s our goal over the next year to find out why those 800 children don’t have health care and how we can bring them in,” he said. The bill also includes Gov. Joe Manchin’s pilot program for providing clinic-based primary-care services to the uninsured for an as-yet-undetermined prepaid fee, and will create an Interagency Health Council to study how to move the state toward universal health coverage.
- In Pennsylvania, Gov. Edward Rendell has proposed “Cover All Kids,” an effort that is aimed at expanding coverage to the 133,589 Pennsylvania children whose families make too much to qualify for Medicaid or SCHIP, but too little to be able to afford private-sector coverage. Like All Kids, the Pennsylvania program would charge premiums based on income. The governor estimates that 15,000 children could be covered in the first year, at a cost of $4.4 million in state funds and $10.2 million in matching federal funds.
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