Medicaid and SCHIP Coverage: Findings from California and North Carolina

Beginning of article

INTRODUCTION

A number of recent studies have examined access and use experiences of children enrolled in SCHIP. These studies consistently show that SCHIP enrollment improves access to and receipt of care for children who enroll in SCHIP. Other studies have examined the extent to which SCHIP is substituting for ESI (Allison et al., 2003; Hughes, Angeles, and Stilling, 2002; Sommers et al., 2007), finding that a small percentage of children transfer directly from private coverage to SCHIP.

In contrast, less research has been conducted recently on Medicaid Programs for children. It is important to examine access issues under Medicaid, which covers 25 million children (Kaiser Commission on Medicaid and the Uninsured, 2006). Medicaid is also the most important source of coverage to poor children in this country, insuring close to 60 percent living below the Federal poverty level (FPL).

There have been ongoing concerns about access to care under Medicaid related to low payment to providers and other factors. However, past studies have found that Medicaid enrollees fare better than their uninsured counterparts and that they enjoy better access than low-income children with private coverage in some service areas because of the broader benefits and narrower cost-sharing requirements in Medicaid.

Historically, substitution of public for private coverage has been far less of a concern within the Medicaid Program than within SCHIP. While SCHIP legislation mandates that States implement policies to discourage substitution at enrollment, no such mandate exists for Medicaid. For example, children eligible for Medicaid and covered by employer insurance are not required to fulfill waiting periods before enrollment. (1) Previous research has found some evidence of substitution for private coverage by the Medicaid Program--referred to as crowd-out (Blumberg, Dubay, and Norton, 2000; Cutler and Gruber, 1997; Dubay and Kenney, 1996).

Here we examine parental coverage patterns and access to care for children enrolled in Medicaid and SCHIP, and we assess impacts of Medicaid enrollment for children in California and North Carolina. (2) This analysis was done as part of a congressionally mandated evaluation of SCHIP that examined 10 States that included supplemental analysis of Medicaid Programs for children in 2 States. California and North Carolina were selected for the supplemental Medicaid study because they each have a major separate SCHIP component, which provides a contrast between the programs, and because they both had enrollment files that could support the study. (3,4)

Table 1 shows how SCHIP differs from Medicaid along several programmatic dimensions in these two States. As mentioned previously, both States have separate non-Medicaid SCHIPs under Title XXI: Healthy Families (California) and Healthy Choice (North Carolina). In both States, children's enrollment in Medicaid far exceeds enrollment in SCHIP. (5)

Medicaid has more generous income eligibility thresholds for infants and children under age 6 than for school-age children. For example, Medicaid income eligibility thresholds for infants are 200 percent of the FPL in California, and 185 percent in North Carolina, 133 percent for age 1-5, and 100 percent for age 6-18 (under Medicaid, States must cover children under 6 up to 133 percent of the FPL and children 6-18 up to 100 percent of the FPL). In contrast, SCHIP income eligibility thresholds are 250 and 200 percent for children of all ages in California and North Carolina, respectively. In both States, Medicaid and SCHIP service delivery systems are different from one another--in North Carolina, SCHIP relies on a Blue Cross[R]/Blue Shield[R] network which includes different providers than under Medicaid, and in California, Medicaid and SCHIP contract with different managed care plans (Hawkes and Howell, 2002; Hill and Hawkes, 2002; Hill, Harrington, and Hawkes, 2004). In California, both SCHIP and Medicaid rely on capitated managed care arrangements, but SCHIP has managed care in more counties than Medicaid (Hill, Harrington, and Hawkes, 2004). (6)

DATA AND METHODS

The data for this analysis were drawn from surveys of Medicaid and SCHIP enrollees fielded in California and North Carolina in 2002. (7) The survey was conducted in English and Spanish, using computer-assisted-telephone interviewing. Field followup was used to locate families who could not be reached by telephone, and cellular phones were used to conduct these interviews. Interviews were conducted with the person most knowledgeable about the health care needs and services for the sampled child.

Data from State Medicaid and SCHIP eligibility and enrollment files were used to construct the State-representative sample frames for each program for two analytic subgroups: (8)

* Recent Enrollees--Children enrolled in the given program for at least 1 month, but less than 3 months at the time of sample frame construction and who had had at least 2 months without coverage in the program prior to enrollment--were asked about their access and use experiences during the 6 months prior to enrolling in Medicaid or SCHIP.

* Established Enrollees--Children who were enrolled in the program for 5 or more months at the time of sample frame construction--were asked about their access and use experiences while enrolled in Medicaid or SCHIP during the 6 months prior to the time of the survey.

To create samples that were comparable between the SCHIP and Medicaid Programs, several exclusions were made to the Medicaid enrollment files, based on children's reason for eligibility. Major exclusions included the blind/disabled (Supplementary Security Income) and medically needy categories. Our analysis focuses on children enrolled in Medicaid through the poverty-related expansions and the Temporary Assistance to Needy Families/Aid to Families with Dependent Children provisions (Trenholm et al., 2005).

The response rates on the Medicaid component of the survey were lower than those achieved on SCHIP. The response rate for the established enrollee samples (on which most of this analysis is drawn) in California were 41 and 78 percent in Medicaid and SCHIP, respectively, and 60 and 77 percent, respectively, in North Carolina. Low Medicaid response rates also have been found in previous studies (Ciemnecki et al., 2002; Edwards, Bronstein, and Rein, 2002), reflecting inadequate contact information available in administrative records (Ghosh et al., 2001). The relatively low Medicaid response rate on the California survey raises the possibility that estimates made for the Medicaid population and comparisons with the SCHIP population are biased, but the weighting strategy should have addressed this potential bias to an extent (Trenholm et al., 2005). The sampling weights and standard errors used in this analysis were developed to reflect the sample design. Standard errors are calculated based on the Taylor series linearization approach.

Parental Insurance Coverage

We assess patterns of parental coverage using data on the established Medicaid and SCHIP enrollees samples. This analysis draws on an analytic sample of over 2,000 established enrollees, including subsamples ranging from a low of 394 in the Medicaid sample in California to a high of 614 in the SCHIP sample in North Carolina. Parents were asked about their insurance status, e.g., Medicaid, ESI, non-group, etc. Those with ESI were asked whether the employer contributed some, none, or all of the premium for own coverage, but they were not asked about the availability of family or dependent ESI coverage or about how much of a contribution would be required to obtain ESI. Since previous research indicates that only about 6 percent of employers offer insurance to their employees, but do not provide dependent coverage, we assume that a parent with ESI can also enroll their children (Fronstein, Helman, and Greenwald, 2003).

We use the information on ESI coverage among the parents as an indication of the extent to which the child could be covered under ESI. However, clearly, not all parents with ESI would have enrolled their child in their employer plan if Medicaid or SCHIP were not available, since some parents would leave their child uninsured rather than pay the premium associated with dependent coverage, which can be considerable. In addition, we consider whether the child has elevated health care needs because some States take a child's health status into account when they implement their anti-crowd-out provisions. (9) For example, some States, including North Carolina, take into account whether a child has significant health care needs when determining whether a child needs to satisfy a waiting period before enrolling in SCHIP.

We present multiple estimates of the availability of ESI: (1) the extent to which at least one parent has ESI; (2) the extent to which at least one parent has ESI and the employer pays at least something toward the premium; and (3) the extent to which at least one parent has ESI, the employer pays at least something toward the premium and the child does not have elevated medical needs.

Access to Care

We compare the health care access and use experiences of established Medicaid and SCHIP enrollees in the same State for five different types of indicators--(1) service use, (2) unmet needs, (3) perceptions about ability to meet child's health care needs, (4) presence and type of usual source of care, and (5) provider communication and accessibility. These …