Published Thursday, October 21, 1999, in the San Jose Mercury News

Kids' health insurance woes widen

Uninsured: Low-cost Medicaid substitute falls short as a remedy.

By Laura Meckler
Associated Press

WASHINGTON -- The number of uninsured children in California is growing despite a low-cost program that has enrolled children for two years, a report released Wednesday shows.

California, the nation's most populous state, has 1.7 million uninsured children. Nationwide, the number of children without health insurance coverage remains at 11 million.

The problem, advocates say, is that the children lost Medicaid coverage when their families left welfare, even though many of them are still eligible for the program.

A new Children's Health Insurance Program, created to help reduce the number of uninsured children, has signed up more than a million children, but its efforts are not enough to counter the falling Medicaid rolls.

``We're no further down the road toward protecting children than we were in 1996 or '97,'' said Ronald Pollack, president of Families USA, which released the study comparing 12 states' coverage of children in 1996 and 1999.

That study found that overall, more children left Medicaid than joined the new program, which is aimed at kids who are not poor enough to qualify for Medicaid.

Economy played role

Stan Rosenstein, assistant deputy director of the California Health Services Department, said that as the economy improved after the recession of the early 1990s, more people got jobs and became ineligible for Medi-Cal, the state's version of Medicaid.

``By its nature, as the economy improves and people are making more money, less people are going to qualify for Medi-Cal,'' Rosenstein said.

Another reason for the growth of the uninsured in California is employers who fail to offer coverage for their workers, he said.

In 1998, the first year of California's Healthy Families program, as CHIP is known here, the number of children enrolled was higher than the number who came off Medi-Cal, he said.

The state is working on getting uninsured families to sign up for Healthy Families. The projected enrollment is about 500,000 children, but only about 146,000 are signed up so far.

There have always been a considerable number of children who qualify for Medicaid but do not receive it. But the number appears to have grown with falling welfare rolls.

Traditionally, welfare and Medicaid went together, and many states have allowed children who still qualify for Medicaid to leave the program when their families leave welfare. In fact, some states' welfare computer systems automatically cut Medicaid when welfare checks are cut, because the two used to be so closely tied.

Initial report

It's a problem that has been noted by President Clinton and advocates for the poor. But the reports released Wednesday are the first that attempt to quantify the impact on the total number of uninsured children.

About half of the drop is due to the drop in the total number of poor children, but the rest represents kids who remain poor but do not have the coverage, the report said.

So as states enroll children in the new insurance program, they are simply replacing, at least numerically, those who lose insurance from Medicaid.

``The nation is losing a significant opportunity to reduce the number of low-income children without health insurance,'' the Center on Budget report concluded.

The Families USA study looked at children in 12 states and found that, overall, the number of kids being insured by the new health program did not make up for the kids who left Medicaid.

Five states saw net declines in the number enrolled. They included Texas, with a 14.2 percent drop; Ohio, a 7.3 percent drop; Arizona, 6.5 percent drop; California, 4.2 percent drop, and Pennsylvania, 3.9 percent drop.

Seven states saw net gains. They were North Carolina, with a 15.8 percent gain; Louisiana, 8.4 percent gain; New York, 3.2 percent gain; New Jersey, 2.7 percent gain; Georgia, 1.2 percent gain; Illinois, 0.5 percent gain and Florida, 0.1 percent gain.