We’ve been tracking net child enrollment losses in Medicaid with state administrative data and our tracker is going to hit two million soon. In reality the number is certainly at two million already given that these numbers don’t include three states (Michigan, New York, and Oregon) and that Texas data, a state which has disenrolled hundreds of thousands of children, is only available through July 2023.
Two million is a big number – for context from 2017 to 2019 Medicaid enrollment for children dropped by almost one million and the rate of uninsured children went up by one percentage point. Are most of these children moving to other coverage sources? How worried should we be?
Sadly, we should all be very worried. With high rates of procedural terminations abounding, it remains likely that many of the children losing coverage remain eligible – as was projected by federal researchers who estimated that about three in four children losing Medicaid as part of unwinding would remain eligible. But for those whose family incomes have risen while the continuous coverage protection was in place, the Children’s Health Insurance Program (CHIP) should be the primary place they are going. Estimates by the Urban Institute projected that 57% of children who became ineligible for Medicaid would move to CHIP.
Now a few background items – 20 states run their CHIP programs for children entirely as a Medicaid expansion with CHIP funding – so there is no need for any transition. But for those states that have separate CHIP programs the data isn’t promising so far. In the states with separate CHIP programs, where we have data, net enrollment has increased by only 104,000. This is compared to a net child Medicaid enrollment decline of nearly 1.2 million in these same states. Even more troubling, in five of these states, separate CHIP enrollment continues to decline, even months into their unwinding process.
Another option for where children could land is employer-sponsored health insurance (ESI). But this transition is less likely for children than adults. Low-wage workers are rarely offered affordable coverage for their dependents. According to a survey of employer health benefits, the average annual premium for ESI for a family is nearly $24,000, almost 3 times more expensive than a plan for a single individual. These costs have risen in recent years, and for the majority of workers who do have ESI, their employer does not contribute a significant portion of premium costs. This is why it was such a big deal for the Biden Administration to finally address the “family glitch” in determining eligibility for marketplace subsidies for dependent children and spouses of individuals offered job-based coverage.
As our colleague Edwin Park has blogged about, we are still not seeing a significant uptick in federal marketplace enrollment either – and the marketplace has historically insured a very small number of children relatively speaking – with 1.55 million covered in 2023. According to the latest CMS marketplace data from June, the numbers of those enrolling in the marketplace only constitutes a small percentage — 10.7 percent — of the millions who are losing coverage and this data includes everyone, meaning an even smaller percentage of children are likely moving to the marketplace.
States can and should take action to smooth the transition from Medicaid to CHIP. Already, six of 30 states charging CHIP premiums or enrollment fees permanently eliminated them during or since the COVID public health emergency. And states may waive CHIP premiums where they are in place; our monitoring finds that eight states (DE, GA, IA, MD, NY, VT, WV, WI) have currently done so for some or all of the unwinding period.
Editor's note: To view our Medicaid & CHIP enrollment data sources, click here.
An additional note: Our analysis of Florida's separate CHIP program includes children enrolled in the state's full-pay Healthy Kids and MediKids plans, which means these families are paying the full cost of coverage which is not subsidized by federal or state CHIP funding.