Children’s Continuous Health Coverage

It has long been understood that gaps in health insurance coverage significantly compromise an individual’s access to health care services.  Further, the length of time an individual goes without health care due to such gaps, greatly impacts the individual’s quality of life.  When this individual is a child, the problem warrants greater attention as it is crucial that a child receive necessary treatments and immunizations in order to ensure a healthy start in life.

The causes of health insurance gaps are wide-ranging but the majority often result from job-related changes, such as a new job, more or fewer hours of employment, or changes in employment status.  In addition, the cost of job-based coverage affects employer offer rates, as well as employee participation.¹  Others factors that contribute to discontinuous coverage include complex enrollment and eligibility determinations, confusing communications with families and changing family circumstances.²

Additionally, the effects of health insurance gaps often affect those most vulnerable to health coverage changes – the low-income population.³  There also appears to be an association between education and insurance stability, with more educated individuals more likely to have stable coverage than less-educated individuals.⁴ Race and ethnicity are strongly related to unstable coverage, with Hispanics at greater risk of discontinuous coverage and longer lapses in coverage than non-Hispanic whites or blacks.⁵  There are also differences between citizens and non-citizens, with non-citizens more likely to experience gaps in coverage.  For instance, over a 12-month period, more than half of non-citizens were uninsured at some point, compared with about one fifth of citizens.⁶

Although no one study definitively points out the causes and effects of gaps in health insurance coverage, the problem is widespread.  For our purposes, in Massachusetts, many families “whose income fluctuates close to 300% of poverty level eligibility cut-off find themselves constantly becoming ineligible and then re-eligible for MassHealth and as a result their children are paying the price, by missing doctor’s appointments, not being able to get prescriptions filled and ending up in the emergency room.”⁷

Recently in an effort to increase health coverage retention for children, the Massachusetts legislature passed a 12-month continuous eligibility for children provision as an outside section of the budget.  Governor Deval Patrick ultimately vetoed this section due to budgetary constraints.  The legislature has another chance to pass this section by putting the provision back onto the FY2011 budget as 33 other states have done.⁸

If the 12-month continuous eligibility policy is passed, children under the age of 19 who enroll in Medicaid or Children’s Health Insurance Program (CHIP) would have continuous health care coverage regardless of changes in their family income during that one-year period. 

From a perspective of well being, continuous eligibility assures families and providers that coverage will be maintained for a predictable period of time.  Continuous coverage reduces the occasions when changes in family circumstances (whether seemingly positive or negative with overtime pay or a reduction in hours of employment) disrupt a child’s health insurance coverage.⁹  Further, research studies suggest that even minor gaps in health coverage cause individuals to delay care for necessary ailments, avoid preventative visits, and forego prescription refills.¹⁰ 

From a financial perspective, there are approximately 16,000 children in Massachusetts who experience gaps in their health insurance coverage.¹¹  The administrative costs associated with these children’s enrollment into Medicaid or CHIP are estimated at approximately $200 per enrollee, per enrollment cycle.¹²  Such cost increases as recipients lose coverage and subsequently re-enroll.  According to the Center for Health Law and Economics in Massachusetts, such numbers suggest that for one re-enrollment cycle, the state is burdened with approximately 3.2 million dollars in administrative costs.  Depending on the number of re-enrollments, the state could potentially save more if a 12-month continuous eligibility plan is implemented. 

Since health insurance coverage gaps compromise an individual’s access to needed health care services, it is in the state’s best interest to implement a 12-month continuous eligibility policy for both the state’s budget and more importantly for children’s health.

Namita Agarwal is AyerHoffman's Health Law & Policy Contributor. Ms. Agarwal is currently a J.D. candidate at Northeastern University School of Law where she concentrates her studies on domestic and international health care, welfare, and immigration law.