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Changes to SCHIP Needed to Ease Enrollment Problems, Analysts Say

JUNE 16, 2006 -- As lawmakers consider the reauthorization of the State Children's Health Insurance Program (SCHIP), health analysts said the program should be changed to make it easier to get eligible children enrolled and reenrolled, thereby cutting down on the number of children who lose or don't have health insurance every year.

The program was created by the Balanced Budget Act of 1997 (PL 105-33) to help states provide coverage for children in families with incomes up to 200 percent of the federal poverty level. In 2004, an estimated 6.5 million children didn't have coverage, a majority of whom were eligible for either Medicare or SCHIP, according to data from the Alliance on Health Care Reform, which gave a presentation Friday on Capitol Hill.

"Coverage for kids is a critically important issue," said Matt Salo, director of the Health and Human Services Committee at the National Governors Association. And SCHIP does appear to be working. Since its implementation, fewer children have been uninsured, according to data from the U.S. Census Bureau.

A recent congressionally mandated evaluation of the program shows that low-income families who are eligible do not enroll their children for health care coverage because they don't know about it, are not sure of their eligibility, or believe the enrollment process is difficult. In other cases, sometimes the child becomes disenrolled from health care coverage without the parents' knowledge.

Laura Summer, a senior research scholar at Georgetown University's Health Policy Institute, presented four recommendations to increase the effectiveness of the program. First, Congress should mandate that the renewal process be streamlined to use information already available, instead of having the child renew from scratch. Second, children also should be required to renew less frequently. Summer cited the example of Washington State, which switched to a six-month renewal cycle and then back to a yearly cycle—the decline and then surge in enrollments was nearly 30,000 children.

Third, Summer also recommended that communication systems be enhanced to smooth the transition of various public programs. And finally, she recommended that states consider the impact of premiums, noting that in some states where premiums were required, those who failed to pay lost coverage.

Summer also noted the new requirement that Medicaid applicants provide proof of citizenship, which goes into effect July 1, will need to be taken into account for children's health care coverage. "I suspect that particular factor will jump to the top of the list," Summer said.

Stan Dorn, a senior policy analyst at the Economic and Social Research Institute, recommended a similar program to the school lunch program, where many states have implemented means-testing—where those below a certain income level are automatically enrolled to receive school lunch.

"Federal resources need to be on the table in a major way," Dorn said about the need to upgrade the Medicaid Management Information Systems to automate the process of identifying which children need support and cut down on time wasted for reassembling information.

Dorn also recommended changes to the Medicaid eligibility rules to give states more flexibility to provide health coverage when other programs have determined that a family's income is low enough.

Dorn recommended the Covering Kids Act of 2005 (S 1049, HR 3050) as an example of legislation that would give states the flexibility needed to overlook methodological differences.

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