Health Affairs, 23, no. 5 (2004): 153-154 doi: 10.1377/hlthaff.23.5.153 © 2004 by Project HOPE	New Online   Obama's Success & Next Steps   3 Health Policy Options for President Obama   A Hybrid Proposal   Bipartisan Compromise

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Child Health Perspectives

PERSPECTIVE

Chipping Away At The Uninsured

Abstract

 
Although the State Children’s Health Insurance Program (SCHIP) has accomplished a great deal, more than nine million children—many of whom are eligible for public health insurance—remain uninsured. In this commentary I propose that coverage for children should be universal, with eligibility systems operating behind the scenes in a way that relieves individual families of the burden of enrollment. States, the federal government, employers, and families would have to reconsider their roles in providing coverage, but starting with the appropriate vision would put the focus on practical problems and overcome the inherently limited approach of layered, incremental programs.

The Kenney and Chang paper demonstrates that layering SCHIP on top of Medicaid on top of a fragile employer-based system of coverage can only get us so far. A better approach would begin with the premise that all children will be covered and then challenge ourselves to design a system that gives meaning to that goal.

How could such a system work?

Top How could such a... Federal and state roles. Universality over precision. Editor's Notes NOTES

 
Let us start with the notion that every child is issued a coverage card with no expiration date. Providers would swipe the card at the point of service and receive coverage information that enables them to bill the appropriate party. One child may have coverage through her parent’s workplace, while another child would be enrolled in Medicaid.

If, for example, this vision were adopted by a state, the state would have two important new roles. First, it would have to maintain an accurate database of coverage. This means that employers and health plans would need to share coverage information in real time and that public coverage rolls would have to be kept up to date. Second, some new source of coverage would have to be available for children not covered through current programs. The state could extend Medicaid or SCHIP eligibility, provide state-funded insurance, finance care directly from the state treasury or through a cost-sharing structure like Massachusetts’s uncompensated care pool, or use some combination of these approaches.

Since the state would prefer not to bear the full cost of covering its children, it would have strong incentives to streamline eligibility for existing public programs, for which federal matching funds are available, and to enact policies that maximize employer-based coverage, whether through market rules, tax credits, or premium assistance. And it would be likely to experiment with approaches that offer coverage or partial subsidies to people during transitions, such as changing jobs or leaving school, which often create gaps in coverage.

Federal and state roles.

Top How could such a... Federal and state roles. Universality over precision. Editor's Notes NOTES

 
Such a vision would be easier to achieve with the active support of the federal government. The federal government could lead the way on eligibility simplification and offer partial financing for the gap-filling programs needed to make children’s coverage universal. In addition, states have it largely within their power to radically simplify the eligibility standards and processes for Medicaid and SCHIP as they relate to children. A county or group of counties could also take on the challenge, as has occurred in California.³

Universality over precision.

Top How could such a... Federal and state roles. Universality over precision. Editor's Notes NOTES

 
Perhaps the most important feature of the vision is an acceptance of the value of universality over the value of precision. In the name of precision (defining exactly who is eligible), we now leave millions of children without coverage. The burden of their uncompensated care falls haphazardly upon the residents and businesses of every community. If we begin with the value of universality, the challenge of allocating the financial burden in an equitable manner is separated from the challenge of providing coverage to every child. In a universal system, families would receive the unambiguous message that their children are covered; the stigma of eligibility determination and the confusion of re-certification would largely disappear; and the energy dedicated to outreach for eligibility could be redirected to the more productive endeavor of health promotion.⁴

I am not suggesting that we turn the job of health insurance coverage over to the government. Indeed, once we decide that we are going to fill in the gaps in coverage, it becomes even more important to enact policies that prevent the gaps from growing. Anyone adopting this vision will need to confront difficult questions such as the responsibilities of employers and families to finance care so that those payment sources do not erode.

I also do not intend to minimize the importance of current efforts to simplify eligibility processes and reach out to eligible children and their families. Having observed tremendous variation around the country in take-up rates for public programs, I see that these state and local efforts have made a difference, and they will continue to, so long as the burden of navigating the application process falls on families.

Yet, as some states and localities pursue aggressive outreach, they reveal the costs and shortcomings of the current framework. I propose that we adopt a vision of universal coverage and act to implement it. Then, if we fall short, it will be because of practical problems that we can work to overcome, not limitations inherent in our approach.

Editor's Notes

Top How could such a... Federal and state roles. Universality over precision. Editor's Notes NOTES

 
Alan Weil (aweil{at}nashp.org), formerly with the Urban Institute, is executive director of the National Academy for State Health Policy in Washington, D.C., and Portland, Maine.

NOTES

Top How could such a... Federal and state roles. Universality over precision. Editor's Notes NOTES

 

1. G. Kenney, J. Haley, and A. Tebay, "Children’s Insurance Coverage and Service Use Improve," Snapshots of America’s Families III, no. 1 (Washington: Urban Institute, 2003).
2. L. Dubay, I. Hill, and G. Kenney, Five Things Everyone Should Know about SCHIP, Assessing the New Federalism Brief no. A-55 (Washington: Urban Institute, October 2002).
3. See, for example, E. Howell et al., Evaluation of the San Mateo County Children’s Health Initiative: First Annual Report (Washington: Urban Institute, 2004); and C. Trenholm, Expanding Coverage for Children: The Santa Clara County Children’s Health Initiative, Issue Brief no. 3 (Washington: Mathematica Policy Research, June 2004).
4. This vision borrows from the New York State Electronic Claims Clearinghouse Demonstration, undertaken in the early 1990s, in which the state generated administrative savings by "clearing" medical claims for a broad range of payers. S.M. Korczyk, The New York State Electronic Claims Clearinghouse Demonstration (Washington: Alpha Center, May 1995).

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