States expand children's access to health care

Texas tries to reclaim lost SCHIP enrollees, while Washington and Oklahoma strive to cover new children. About 210,000 kids are expected to gain coverage.

By Doug Trapp — Posted July 2, 2007

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So far this year, three states have adopted legislation to expand their children's health care coverage significantly, largely through their State Children's Health Insurance Programs.

Texas' SCHIP is expected to regain about 130,000 enrollees from a reversal of cost-cutting program changes adopted in 2003. Washington and Oklahoma expect to cover about 40,000 more children each in upcoming years. Oklahoma is providing assistance for buying private insurance, while Texas and Washington are taking the more standard approach of expanding SCHIP eligibility.

Also, at least two other states -- Louisiana and Oregon -- at press time were considering bills to expand children's access to health care.

The gains in the three states are modest when contrasted with the roughly 9 million uninsured children in the U.S. -- of which about 6 million are eligible for SCHIP or Medicaid. But congressional lawmakers are crafting SCHIP reauthorization legislation that could address the larger issue of uninsured children. The program is 10 years old this year and will expire on Sept. 30 if it is not renewed.

SCHIP restrictions dropped

Texas, which has the highest overall uninsured rate in the nation at 25%, took one small step away from that distinction with legislation passed this session. The Legislature adopted a bill in May expected to bring the state's SCHIP enrollment to 430,000. The program's population peaked in 2002 at more than 500,000 but today stands at about 300,000.

The bill, supported by the Texas Medical Assn., allows enrollees below 185% of the poverty level to renew their coverage every 12 months instead of every six months and revokes the 90-day waiting period for applicants other than those who had health insurance in the 90 days leading up to the application.

Texas Gov. Rick Perry signed the bill just before the June 17 deadline for gubernatorial action on bills. The measure, backed by the Texas Chapter of the American Academy of Pediatrics, maintains eligibility at 200% of the federal poverty level. It is expected to cost $232 million through fiscal 2009, including $74.7 million in state funds.

Passage likely doesn't represent a wider philosophical shift in the Legislature toward spending more for health care, said Gary Floyd, MD, president of Texas AAP chapter.

"I believe that dealing with government-funded insurance is a pain to most of our state legislators," Dr. Floyd said. A few legislative leaders have deemed the state's Medicaid spending unsustainable because it accounts for 26% of the budget, he said.

The Legislature likely felt pressure to improve children's health care from a lawsuit against its Medicaid program, Dr. Floyd said. The 14-year-old Frew vs. Hawkins case reached a tentative settlement in April. It included a 25% increase in Medicaid physician payments for children's care, which lawmakers adopted in late May and Perry signed in June.

TMA surveys have estimated physician participation in the state's Medicaid program decreased from 68% in 2002 to 37% in 2006. While lawmakers seem to expect the Medicaid payment increase will bring physicians back to the program, it will maintain existing participation at best, Dr. Floyd said.

Still, the Texas Chapter of the AAP and the TMA support the settlement, which will be reviewed by a federal judge in early July.

The state, however, isn't increasing its SCHIP payments, which still cover only about 50% of the cost of an office visit. These rates haven't changed since the program began a decade ago, Dr. Floyd said.

Boosting SCHIP reimbursement

Washington not only expanded SCHIP, but improved the programs' physician payments.

Lawmakers there gave pediatricians a 48% Medicaid/SCHIP payment increase this legislative session. This brings rates to 118% of Medicare, but they are still below private insurance levels, said A. Chris Olson, MD, MHPA, outgoing president of the Washington Chapter of the AAP.

Legislation also adopted this session will increase eligibility in the state's combined Medicaid/SCHIP from roughly 250% to 300% of the poverty level by Jan. 1, 2009. This should enroll another 38,500 children and cost about $61 million, including $36.6 million in state spending, said Jim Stevenson, spokesman for the Washington Medicaid program.

A key provision in the Medicaid/SCHIP law calls for increased outreach. "Lots of times the problem is they're just not aware they actually qualify for Medicaid," Dr. Olson said. The Washington State Medical Assn. and the Washington Chapter of the AAP backed the bills.

In Oklahoma, Gov. Brad Henry signed a bill in late May to provide health care vouchers for families earning between 185% and 300% of the poverty level by 2011. The move will cover an additional 42,000 children. The vouchers are designed to be used to buy private insurance.

The Oklahoma State Medical Assn. and the Oklahoma AAP chapter supported the bill. A 2001 lawsuit filed by Oklahoma Chapter of the AAP against Oklahoma's Medicaid agency led to an increase in physician Medicaid payment rates to match Medicare rates in 2005. But the state is appealing the ruling in federal court.

The state has a significant shortage of pediatric specialists and subspecialists, said Michael Stratton, DO, president of the Oklahoma Chapter of the AAP and a Muskogee pediatrician."We're in a big hurt that way," he said.

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States cover more children

Three states so far this year -- Texas, Oklahoma and Washington -- have significantly expanded children's health coverage. The laws are expected to cover:


  • About 130,000 of 1.3 million uninsured children, mostly by requiring State Children's Health Insurance Program participants to renew their enrollment every 12 months instead of every six months and by eliminating the 90-day waiting period for certain families.
  • Eligibility remains at 200% of the poverty level or below.
  • The law is expected to cost $76 million through fiscal 2009.


  • 42,000 of 127,000 uninsured children by Jan. 1, 2011, by giving vouchers to families earning between 185% and 300% of the federal poverty level to help buy health insurance.
  • The law is expected to cost $38 million a year once operational, including $8.5 million in state dollars.


  • 38,500 of the 125,000 uninsured children by June 2009, by increasing eligibility levels for SCHIP, Medicaid and a local health program to 300% of the poverty level by Jan. 1, 2009.
  • Families with higher incomes will be able to purchase Medicaid coverage at cost.
  • The law is expected to cost $61 million, including $36.6 million in state spending.

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