The Affordable Care Act’s (ACA) coverage provisions did not target children’s eligibility for Medicaid or CHIP. It was aimed at closing the coverage gap for adults – both adults without dependent children, who were generally ineligible for Medicaid, and parents, whose pre-ACA Medicaid eligibility was well below the poverty level in many states. Yet, we know that enrollment of uninsured children who were eligible but not enrolled in Medicaid/CHIP has been a driver of the ACA’s success in achieving historic levels of coverage for children. In fact, in less than two years following ACA implementation, health coverage rates for children improved by 2.4 percentage points – from 92.9 percent to 95.2 percent. We call that the “welcome mat” effect but how does it work and what’s at risk with the current ACA repeal and replacement plan – the American Health Care Act (AHCA)?
Covering parents reduces the number of uninsured children. It’s clear that coverage of parents results in better coverage rates for children. In the years preceding ACA implementation, two-thirds of uninsured children were eligible but not enrolled in Medicaid or CHIP. In fact, 84 percent of children had the same insurance status as their parents according to a 2011 GAO study. Massachusetts provides a good example of how insuring more parents results in improvements to children’s health coverage rates. In Massachusetts, children saw their uninsured rate cut in half when coverage was expanded to more parents and other adults. Provisions in the AHCA – namely ending the enhanced match for adults after 2019, phasing out the enhanced match if a parent has a gap in enrollment of more than a month, and requiring states to re-determine eligibility every six months – will result in the Medicaid expansion withering on the vine. History shows that when parents lose eligibility, children will wind up losing health coverage too.
Outreach, consumer assistance and the individual mandate promote enrollment in coverage. There’s a reason businesses engage in marketing – to create awareness and boost sales of their products. Outreach does the same thing for public coverage programs. Lack of knowledge about program eligibility and unfamiliarity with the application process often pose barriers to enrollment. The ACA recognized the importance of educating the public about coverage options and assisting individuals with enrollment. Coupled with the individual mandate, the increased public awareness of new coverage options resulted in higher enrollment and participation rates among children who were eligible but not enrolled in Medicaid or CHIP. Already the new administration has taken steps to curtail marketing of Marketplace coverage and public education about coverage options. And while the AHCA does not directly eliminate the federal marketplace and healthcare.gov, it’s not clear what if any role they will play in connecting individuals to coverage in the future. I suspect that navigator grants and essential marketing components of Healthcare.gov, which also promote Medicaid, will also be on the chopping block. With pressure on states to reduce Medicaid costs through the AHCA’s capped funding, we can also expect that states will eliminate or curtail their outreach and consumer assistance efforts.
Simplified enrollment and renewal procedures make it easier for eligible individuals to enroll and retain coverage. The ACA also stepped in to remove red tape administrative barriers to enrollment and retention, which were historically cited as a key reason why eligible children were not enrolled. The ACA accelerated state adoption of proven processes and procedures to ease the paperwork burden for states and enrollees. Known as the MAGI-based rules, the ACA spurred states to use trusted electronic sources of data to more accurately and quickly verify eligibility. These rules require coordination between coverage sources so that eligible individuals are connected with the coverage option that matches their eligibility. The ACA also modernized how states verify ongoing eligibility at renewal in a way that promotes retention of coverage for eligible children. Importantly, it also standardized the best practice (and common insurance industry practice) of renewing coverage only once every 12 months. The AHCA would turn back the clock and erect more barriers to coverage by mandating that states re-determine eligibility for the expansion adult group every six months. Such procedures are known to result in churn and gaps in enrollment for eligible children.
Yanking the welcome mat out from under low-income and vulnerable children and families will take us backwards in covering children. ACA repeal and Medicaid restructuring threaten the progress we have made not only in dramatically reducing the uninsured rate for all Americans but also in welcoming eligible children into coverage. As the state snapshots of children’s coverage we recently released with the American Academy of Pediatrics show, 79% of children living in or near poverty, 45% of children under the age 6, and 43% of children with disabilities or special health care needs rely on Medicaid to see a doctor and dentist. This is no time to turn our backs on children. They are our nation’s future and without access to health coverage, they will not be able to live up to their full potential.