Outlook for Children’s Health Coverage Mixed in California

California earned a grade of “C” in providing health insurance for children on a report card issued this month by a national youth advocacy group.

Whether that grade goes up or down on the next report card may be determined by policy debates under way now in Washington, D.C., and Sacramento and by voters in November.

In its “2008 California Report Card: The State of the State’s Children,” Children Now, a research and advocacy organization based in Oakland, assigned letter grades to a variety of children’s issues. The state’s K-12 education system earned a C-. In kids’ obesity, California got a D+.

The C in health insurance was not as bad as it could have been, according to some.

What happens next in the effort to secure health insurance for all children in the state will be affected by the future of the national funding mechanism for the Healthy Families program as well as the legislative campaign for health reform in California. State voters also might have a say in November if the Senate approves the reform package put forward by Republican Gov. Arnold Schwarzenegger and Democratic speaker of the Assembly Fabian Núñez (Los Angeles). The governor and Núñez are working to qualify a ballot measure to fund their reform plan for the November election.

“We’re at a moment of truth,” says Wendy Lazarus, founder and co-president of The Children’s Partnership, a national child advocacy organization with offices in Santa Monica and Washington, D.C.

“As kids’ advocates, we’ve been working for years toward the goal of getting all kids covered. I think this ballot initiative is our best chance of doing that in California,” Lazarus says.

Ted Lempert, president of Children Now, agrees.

“The health and education of California’s kids are at a pivotal point,” Lempert says. “Whether or not all children in the state have health insurance coverage will likely be decided by the voters in November 2008.”

Federal Funding a Central Concern

At the core of California efforts to insure kids is the Healthy Families program, California’s version of the State Children’s Health Insurance Program, which is funded jointly by states and the federal government.

In Washington, D.C., this week, Congress begins discussing the future of SCHIP, twice vetoed by President Bush. House Democrats are planning an override vote this week on Bush’s second SCHIP veto. They were unable to override the first.

Last month, after considerable rancor following his second veto, Bush signed legislation to extend funding for SCHIP through March 2009. The 15-month extension is expected to provide enough funds to cover children currently enrolled in the program, but beyond that the program’s future is in limbo.

There’s still some question about exactly how much federal money will be available in the next 15 months, but following Bush’s extension and subsequent communications with federal officials, California officials are a little more optimistic than they were last fall.

“Our anxiety level has dropped significantly in the last few weeks,” says Ronald Spingarn, deputy director of legislation and external affairs for the state Managed Risk Medical Insurance Board.

“There are a lot more indications that there will be enough funding in the coming months. We were worried for a long time that that might not be the case, but recent language coming from federal offices has been much more reassuring,” Spingarn says.

Created in 1990 with a broad mandate to advise government on strategies for reducing the number of uninsured people in California, MRMIB is run by a volunteer board appointed by the governor and the Legislature.

Children’s Health Initiatives

Advocates for insuring kids got some new ammunition last week with a study showing that providing health insurance to children through county-based Children’s Health Initiatives saves California taxpayers in nine counties $7 million a year by preventing more than 1,000 unnecessary hospitalizations.

The research by the Center for Community Health Studies at USC’s Keck School of Medicine compared preventable childhood hospitalizations in nine California counties before and after the implementation of the Children’s Health Initiatives.

While the study, funded by First 5 California, only dealt with county-based Children’s Health Initiatives, the economic impacts have implications for all programs aimed at insuring children.

Children’s Health Initiatives, active in 25 California counties, help boost enrollment in public programs such as Healthy Families and Medi-Cal, and also offer their own coverage through Healthy Kids programs. Healthy Kids is for children in families who don’t qualify for state or federal programs because they earn too much or because of their immigration status.

California Budget Raises Concerns

Kids’ insurance programs — along with many other state programs — face cuts because of California’s estimated $14 billion budget shortfall. “There are some significant steps in the wrong direction,” says Lazarus. “Requiring Medi-Cal recipients to prove eligibility every three months is just ridiculous. The proposed increases for family premiums — even though they may be only $3 to $5 a month — can make it very hard for some families to choose to remain insured. And the across-the-board 10% cuts in Medi-Cal and other programs need to be looked at very carefully,” Lazarus says.

However, those cuts won’t be so crucial if the Schwarzenegger-Núñez health reform plan is adopted, Lazarus predicts.

“Some people say we shouldn’t be going after aggressive health reform right in the middle of this budget crisis, but I think it’s just the opposite: Now is exactly the right time. The reform that’s proposed looks for dollars outside of government,” Lazarus says. “The idea is to create a situation so kids’ health coverage will not be dependent on the ebbs and flows of the general fund.

“On balance,” Lazarus concludes, “the ballot initiative is a very strong package for kids. I think it’s the best shot we’ve had so far of getting us to our goal of having every kid covered.”

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