Children Falling Through the Health
Insurance Cracks

Key Findings and Recommendations from a 100% Campaign Report on Keeping Children Covered in Medi-Cal and Healthy Families

The Challenge
Ensuring uninsured children have health insurance coverage requires enrolling and keeping them insured. California has invested millions of dollars to enroll uninsured children in the state's insurance programs—Medi-Cal and Healthy Families. However, the work doesn't end there: once enrolled, children must maintain that coverage and not be unnecessarily dropped out the back door. Children require stable and continuing coverage to ensure healthy childhood development – it must be there to cover unexpected baseball injuries, ear infections, regular check ups and shots.

Up to 40% of enrolled children lose Medi-Cal and Healthy Families coverage within a year. While some of these children are no longer eligible, a significant number remain eligible and are being dropped due to administrative obstacles. The 100% Campaign focuses on these children in the report: Children Falling Through the Health Insurance Cracks: Early Observations and Promising Strategies for Keeping Low-income Children Covered by Medi-Cal & Healthy Families.

The report sets out to address the following questions:

1. How many children are unnecessarily dropped from Healthy Families/Medi-Cal and why?

2. Where are the cracks in the programs where eligible children risk losing coverage?

3. What promising strategies can improve children's chances of keeping their coverage?

While data monitoring of children losing coverage is limited, examining the experience of those at the local level who assist families to enroll and keep coverage provided a rich insight into where children are at risk. We included the perspectives of community groups, counties, health plans and families in California and other states' insurance programs for promising strategies.

Key Findings

• Stable Insurance Coverage is a Wise Investment
  • Children with ongoing coverage have better access to care and are healthier.
  • Keeping children covered means taxpayer dollars are put to better use.
  • It costs more to mistakenly drop a child from coverage and then re-enroll her.
    
• Children Are Losing Medi-Cal/Healthy Families Coverage Unnecessarily
  • The limited data available indicate that most children losing coverage are still eligible.
  • 60% of Healthy Families children kept (40% lost) their coverage a year after enrolling.
  • Nearly 171,000 children lost Healthy Families coverage in a one-year period (June 2002).
  • About 64% of Medi-Cal children kept (36% lost) their coverage a year after enrolling.

Coverage & Retention for Children in Medi-Cal/Healthy Families Source: MRMIB Data, DHS Medi-Cal Enrollment and Continuing eligibility analysis. *January 2002 for Medi-Cal and May 2002 for Healthy Families **June 2001 through May 2002. ***Percentage of children who are still covered 13 months after enrollment. Medi-Cal: 8/00 to 9/01, Healthy Families 6/99 to 12/00.

• Data and Monitoring of Children Losing Coverage is Limited
  • Regular reporting of retention rates, and how many children lose coverage and why is needed.
  • The state does not track children after they are dropped to know if they are uninsured.
    
• Children Lose Coverage Primarily Because of Administrative Problems
  • Children are dropped by mistake or parents do not know why their children were dropped.
  • There are five major program cracks where eligible children are most at risk of losing insurance:
    1. Switching between insurance programs is confusing and is not seamless.
    2. Complex paperwork for renewals is a significant deterrent for eligible children.
    3. Premiums may be difficult to pay in hard times and how to pay can be confusing.
    4. Important program notices to families may not arrive or may not be understood.
    5. Families need to know more about how to use their health plan coverage.
    
• Community Partners Play a Vital Role in Keeping Children Covered
  • The state relies heavily on counties, community groups and health plans to enroll and keep children covered.
  • More counties are focussing on proactive strategies to retain eligible coverage for families.
  • Community assistants play a vital role in helping families renew and in troubleshooting.

Recommendations
This report highlights simple common-sense proposals for the state programs to build the appropriate foundation and to seal the cracks where children are most at risk of losing coverage. Each category includes an example from the full list of recommendations in the report:

1. Build a Strategic Foundation
   Implement a combined state tracking system to monitor children's coverage.
   Encourage counties' retention efforts through performance bonuses.
   Continue to support the community enrollment and renewal assistance system.

2. Seal Up the Cracks---A few examples from report recommendations
   Coordinate Among Insurance Programs: Synchronize renewals to make it more convenient for families with children in each of the programs.
   Fast-track Renewals: Allow parents to phone in renewals and ask only for any information that has changed (Sample verification checks similar to tax returns).
   Making Premiums Easy to Pay: Offer leniency or hardship relief for families not able to pay premiums one month, and offer premium deductions from workers' paychecks.
   Effectively Communicate with Families: Send reminders to families to renew and color-code notices that require a response.
   Using Services Once Insured: Promote preventive care and provide incentives such as a free month's premium for making recommended well-child visits.

3. Avoid Making the Problems Worse Due to Budget Proposals
   Do not intentionally make it harder for families to renew (e.g. every 3 months).
   Do not roll back parents' eligibility for insurance.
   Do not dismantle the community enrollment and renewal system.