Stimulus Funds Helped States Sustain and Expand Coverage for Low-Income Families in 2009
Most states managed to safeguard health coverage for children and parents in their Medicaid and Children's Health Insurance Programs (CHIP) in 2009, and some were able to expand access, according to a new survey from the Kaiser Foundation's Commission on Medicaid and the Uninsured. However, these gains are threatened by the impending end of key federal assistance in December 2010.
As 2009 began, CHIP had still not been reauthorized and states were facing the bleakest economic picture in years, the survey report notes. Several developments early in the year, including passage of the Children's Health Insurance Program Reauthorization Act and infusion of fiscal relief through the American Recovery and Reinvestment Act (ARRA), provided critical federal support to help states maintain and expand coverage. ARRA also included stipulations that prevented states from reducing eligibility and imposing enrollment barriers in their Medicaid programs, which also helped preserve coverage.
The annual 50-state survey of eligibility rules, enrollment and renewal procedures, and cost-sharing practices in Medicaid and CHIP found that, overall, 26 states expanded coverage for low-income children, parents, and pregnant women in 2009. These advancements included broader eligibility, such as higher income limits for children (nine states) and expansion of eligibility to immigrant children and pregnant women legally residing in the United States for less than five years (18 states). Not all states were able to sustain or expand coverage. Because of budget pressures, 15 states had to scale back. CHIP programs bore the brunt of reductions because the ARRA protections apply only to Medicaid.
Children were the main beneficiaries of expansions in 2009, according to survey findings. Nineteen states improved access by broadening eligibility, simplifying procedures, or eliminating premiums. Currently, 47 states cover children in families with an annual income of 200% of the federal poverty level ($36,620 for a family of three in 2009), and in 24 states the upper limit is 250% of poverty ($45,775 for a family of three). Of the 34 states that charge premiums for children, most do not charge families with incomes below 150% of the poverty line. The median charge for two children in a family of three with income at 200% of poverty remains modest at $480 per year ($40 per month), or 1.3% of family income.
Coverage for parents continued to lag significantly behind. As their children gained coverage, millions of parents remained uninsured because eligibility limits for parents are extremely low in most states. The median limit for working parents is 64% of poverty. Thirty-four states limit parents' eligibility to less than 100% of the poverty line ($18,310 for a family of three), and in 17 states the limit is less than 50% ($9,155 per year for a family of three).
States' commitment to providing Medicaid and CHIP coverage will be tested in 2010, when most states are likely to face even bigger budget shortfalls, the report notes. In addition, federal assistance provided under ARRA will expire at the end of the 2010, as will ARRA's Medicaid protections. Substantial state cuts in Medicaid and CHIP could reverse recent expansions and undermine the base of coverage for low-income families upon which broader health reform efforts seek to build.
The 2009 survey findings provide a baseline against which future progress can be measured. States have learned the importance of simplifying enrollment and renewal procedures, covering parents, and limiting cost sharing, and these lessons will be essential in shaping a new health insurance system, the report concludes. The 67-page report, A Foundation for Health Reform: Findings of a 50-State Survey of Eligibility Rules, Enrollment and Renewal Procedures, and Cost-Sharing Practices in Medicaid and CHIP for Children and Parents During 2009, and related materials are available online at www.kff.org/Medicaid .
