Increased Number of Children From Middle-Class Families Enroll in Public Health Insurance Programs
An increasing number of middle-class families are declining employer-sponsored health coverage for their children and enrolling them in public health insurance programs, the Wall Street Journal reports. According to the Journal, SCHIP is the program most affected by the trend. In fiscal year 2003, SCHIP program enrollment increased by 9%, bringing the national enrollment total to 5.8 million.
The Journal reports that there is no one national figure that illustrates families' forgoing employer-sponsored coverage and their "increasing reliance" on public insurance programs. However, a December 2004 study by the Employee Benefit Research Institute found that the proportion of U.S. workers with employer-sponsored health insurance fell from 74.4% in 2000 to 71.5% in 2003. In addition, over the last four years, the percentage of children covered through a parent's employer fell from 62.3% to 58.3% and at the same time the percentage of children enrolled in a public insurance program grew from 20.9% to 26.4%.
Many SCHIP beneficiaries could be covered through a parent's employer-sponsored health plan, the Journal reports. For instance, the Kansas Health Institute in 2003 found that about half of children enrolled in the state's SCHIP program were eligible for coverage offered by their parent's employer, according to the Journal.
In his budget for FY 2006, President Bush has proposed restructuring the SCHIP plan as part of a "broader" Medicaid overhaul, the Journal reports. The administration has indicated that because SCHIP has "capped, predictable federal spending and great flexibility for states," it would be a "better model" than Medicaid for covering low-income parents and children, according to the Journal.
The SCHIP program was authorized to spend about $40 billion in federal matching funds from 1997 through 2007, and the administration has proposed an early reauthorization of the program.
To address mounting fiscal problems, some states have raised SCHIP beneficiaries' cost-sharing, restricted eligibility or halted enrollment outreach efforts. In addition, some states have considered requiring certain employers to provide affordable health insurance to employees.
Further, some insurance companies have examined ways to make their coverage more affordable (Maher, Wall Street Journal, 2/15).