Number B-41 in Series, "New Federalism: National Survey of America's Families"
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In August 1997, Congress created the State Children's Health Insurance Program (SCHIP) to expand health insurance coverage for low-income uninsured children. The SCHIP legislation gave states the option of using Medicaid, a separate state program, or some combination of the two to expand coverage. The SCHIP legislation, along with other provisions of the Balanced Budget Act of 1997, also gave states greater flexibility to streamline the eligibility determination process under both Medicaid and SCHIP by allowing them to implement presumptive and continuous eligibility for children. In addition, the legislation allowed separate SCHIP programs to charge premiums and to implement waiting periods in order to prevent crowd-out.
By 1999, all states and the District of Columbia had received federal approval to implement their SCHIP programs, and by 2000, 33 states had increased eligibility thresholds for children of all ages to at least 200 percent of the federal poverty level (FPL) (Health Care Financing Administration [HCFA] 2000). Despite this broad expansion of eligibility, 22 percent of low-income children (those with family incomes below 200 percent of FPL) were uninsured in 1999 (Kenney, Dubay, and Haley 2000). In the wake of SCHIP's implementation, policymakers have become increasingly interested in knowing how many children are now eligible for Medicaid and SCHIP and how far these public health insurance programs can go toward solving the problem of uninsured children.
This brief presents estimates of Medicaid and SCHIP eligibility, using the eligibility rules in place as of July 2000, for children ages 0 to 17. The results are based on data from the 1999 National Survey of America's Families (NSAF) and rely on a detailed Medicaid and SCHIP eligibility simulation model. Half of all children, accounting for about 85 percent of low-income uninsured children, were estimated to be eligible for Medicaid or SCHIP. Among eligible children, 65 percent were eligible for Medicaid and 35 percent were eligible for SCHIP. Eligibility for Medicaid and SCHIP varied tremendously across the Assessing the New Federalism (ANF) study states.1 The share of children eligible for public health insurance coverage ranged from 34 percent in Massachusetts to 65 percent in Mississippi, reflecting differences in the income distribution across states as well as states' choices of eligibility thresholds.
In order to solve the problem of uninsurance among children, current efforts
must focus on enrolling the 6.8 million uninsured children who are eligible for
coverage under Medicaid and SCHIP. However, even if these efforts are successful, 8 percent of low-income uninsured children are noncitizens who are not eligible for Medicaid or SCHIP solely because of their legal status. Covering this group of uninsured children will require either state funds or new federal legislation.
Notes from this section of the report
1. The 13 ANF states are Alabama, California, Colorado, Florida, Massachusetts, Michigan, Minnesota, Mississippi, New Jersey, New York, Texas, Washington, and Wisconsin.
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