Report Finds CHIP Crowd-Out Fears to be Unfounded

Remember all those claims about how private insurers would be “crowded out” if Children’s Health Insurance Program income eligibility guidelines were to be expanded?  Now a report by the National Bureau of Economic Research finds that those fears are likely to be unfounded as there is little evidence of any crowd out in the states that have expanded CHIP eligibility.

CCF’s research on this issue has found that when states raise the income eligibility levels, more children enroll but the majority of them turn out to be children who already qualified under the pre-expansion eligibility rules.  My colleagues Jocelyn Guyer and Liz Arjun (now with Community Health Plan of Washington) dubbed that the “welcome mat” effect and it has been documented in many states.

Researchers have not yet tackled in detail the question of why expanding coverage results in many low-income families with already-eligible children securing coverage, but the primary theories that have been posited include: increased awareness of coverage opportunities, simplicity of message, simplification efforts and combating concerns about public coverage.

Cathy Hope
Cathy Hope is the Communications Director at the Center for Children and Families