Just last week we released a report commending Florida for making significant progress in reducing the number of uninsured children between 2008 and 2010.  Today, we are releasing a report that shows Florida will unravel much of that progress if allowed to go forward with proposed changes to its Medicaid program that include the imposition of a $10 premium on all Medicaid beneficiaries enrolled in managed care. Since another central feature of the Section 1115 waiver request is to enroll the vast majority of Florida’s Medicaid enrollees in managed care, this new premium would apply to virtually all children in Florida’s Medicaid program.  The proposal was approved by the Legislature and Governor but cannot go into effect without federal CMS approval.

Thanks to the Jessie Ball DuPont Fund and Winter Park Health Foundation, my colleague Jack Hoadley and I were able to take an in-depth look at proposed changes to Florida’s Medicaid program and how they would impact children and families.

So let’s take a look at the facts.  Despite the recent progress we reported, Florida still has one of the highest rates and largest number of uninsured children in the nation.  Using a model developed by researchers at the Urban Institute based on the experience of other states, we assessed the impact of charging these premiums on families in Florida’s Medicaid program. We found that if the premiums were instituted, 807,000 children and parents would drop their Medicaid coverage because they couldn’t afford it.  The vast majority of these families – 98% have incomes below the poverty line. It is possible that some families would find other sources of coverage but the declining availability of affordable employer-sponsored coverage, especially for families with low incomes, makes it likely that many of the children and their parents would become uninsured.

My colleague and co-author Jack Hoadley also points out that the disenrollment of children and families from Medicaid would not only impact the health and well-being of children and families, it would have ripple effects throughout the state.  Those who disenroll are more likely to end up using emergency rooms and delay primary and preventive care –increasing costs throughout the health care system and safety net programs.

Medicaid has proven itself to be a cost-effective approach to meeting the health care needs of uninsured children and families in Florida and elsewhere.  We found that in Florida, Medicaid has shown a 4.8% decline in per person costs over the past five years, while per person costs nationally for employer-sponsored coverage have increased more than 31%.

While some states charge premiums in their Medicaid or CHIP programs, it is typically at higher income levels.  No state currently charges premiums to Medicaid children with family incomes below the poverty line.  Florida’s proposed premium requirement is likely the most far-reaching to date because the state seeks to apply a relatively high charge to everyone in the program regardless of income or age.