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States Promoted Broader Coverage for Children in 2007, But Report That a Declining Economy Coupled With Lack of SCHIP Reauthorization and New Federal Rules Now Compromise Efforts to Reduce the Number of Uninsured
Date:1/28/2008

WASHINGTON, Jan. 28 /PRNewswire-USNewswire/ -- New reports released today by the Kaiser Family Foundation's Commission on Medicaid and the Uninsured (KCMU) describe aggressive efforts by states in the past year and a half to expand coverage to low-income children and their families, but the actions may be curtailed as a deteriorating economic climate and new limits on federal assistance take effect.

A downturn in the economy, the federal failure to reauthorize the State Children's Health Insurance Program (SCHIP) and new federal rules affecting Medicaid and SCHIP eligibility all suggest that the recent period of aggressive expansion of coverage by states may be over. This is the conclusion based on a series of new studies by the KCMU, including a 50-state survey of eligibility and enrollment rules in Medicaid and SCHIP for children and families, interviews with Medicaid directors in ten states representing all regions of the country, and recent studies of enrollment in Medicaid and SCHIP.

"State momentum to address the growing problem of the uninsured has run into a double whammy of a declining economy that is putting additional pressure on state budgets and funds for Medicaid and SCHIP and federal barriers to state expansions," said Diane Rowland, executive director of the Kaiser Family Foundation's Commission on Medicaid and the Uninsured. "In the last recession, federal fiscal relief was critical to states' ability to sustain Medicaid enrollment. Without additional federal assistance for Medicaid and SCHIP in this economic downturn, we are likely to see added growth in the uninsured," she added.

Today's release of the seventh annual 50-state survey of eligibility rules, enrollment and renewal procedures, and cost-sharing practices in Medicaid and SCHIP for children and families, shows that nearly two-thirds (32) of states expanded access to their Medicaid and SCHIP programs between July 2006 and January 2008. However, without the reauthorization of the SCHIP program and with a new federal directive restricting states from using SCHIP to cover children in families earning more than 250 percent of the federal poverty level, these state efforts could be compromised. Twenty-three states could be affected by the directive, including 14 which have already implemented their plans and another ten which have authorized the plans into law, but not yet implemented them. (Washington state is counted in both categories.) Three states have already cut back on their coverage. States also continue to report that the Medicaid citizenship documentation rule is hampering efforts to simplify enrollment and resulting in delays and denials of coverage.

A second report released was based on a November 2007 discussion with ten leading Medicaid directors, representing all regions of the country, who warned that with increasingly poor economic conditions, state Medicaid programs will be stressed. Given earlier efforts to minimize Medicaid spending, the officials noted that achieving significant Medicaid cost savings could be more difficult than in prior years. Virtually every state has already taken cost control actions on prescription drugs and provider payments. Additional action in these areas would yield minimal additional savings and could impact access to care, according to the Medicaid directors. The directors also expressed concern over growing strain in their relationship with the federal government and federal rules on health coverage and services issued over the past year that will restrict federal Medicaid financing, which they believe will adversely affect beneficiaries and safety net providers as they struggle to cope with the economic downturn, and create impediments to effective program design. The directors criticized the timeliness of annual changes in the federal matching rate for Medicaid funds as not responsive to changing economic conditions.

The reports released today include:

-- Health Coverage for Children and Families in Medicaid and SCHIP: State Efforts Face New Hurdles,

-- Current Issues in Medicaid: A Mid - FY 2008 Update Based on a Discussion with Medicaid Directors,

-- SCHIP Enrollment in June 2007: An Update on Current Enrollment and SCHIP Policy Directions,

-- Medicaid Enrollment in 50 States: December 2006 Data Update, and

-- State Children's Health Insurance Program (SCHIP): Reauthorization History.

They can all be found at http://www.kff.org/medicaid/kcmu012808pkg.cfm along with some key publications that explain the impact of federal fiscal relief for Medicaid in the last recession.

The Kaiser Commission on Medicaid and the Uninsured provides information and analysis on health care coverage and access for the low-income population, with a special focus on Medicaid's role and coverage of the uninsured. Begun in 1991 and based in the Kaiser Family Foundation's Washington, DC office, the Commission is the largest operating program of the Foundation. The Commission's work is conducted by Foundation staff under the guidance of a bipartisan group of national leaders and experts in health care and public policy. The Kaiser Family Foundation is a non-profit, private operating foundation dedicated to providing information and analysis on health care issues to policymakers, the media, the health care community, and the general public. The Foundation is not associated with Kaiser Permanente or Kaiser Industries.


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SOURCE Kaiser Family Foundation
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