CHIRI™ Issue Brief No. 6
This Issue Brief compares characteristics and health care experiences of SCHIP
enrollees with those of low-income children who enrolled in the Oregon Family
Health Insurance Assistance Program (FHIAP)—the State's premium assistance
program. Researchers studied the factors that affect parental choice and
compared the effects of both SCHIP and FHIAP on health status, access to
care, utilization of services, and parental satisfaction. In addition, researchers
studied what happens to children who disenroll from either program.
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By Karen VanLandeghem, Jennie Bonney, Cindy Brach, and Lisa Kretz
Contents
Introduction
What Was Learned
Conclusion
Policy Implications
Study Methodology
Sources and Related Studies
About CHIRI™
CHIRI™ Funders
For More Information
Introduction
Premium assistance programs enable States to use funds from Medicaid and the
State Children's Health Insurance Program (SCHIP) to subsidize the purchase
of employer-sponsored or other private health insurance coverage for eligible
low-income families. States can use these programs to promote access to and
enrollment in private health insurance.
States' use of premium assistance
programs has grown in recent years, in part because of greater Federal flexibility
in implementing these programs. Yet, little is known about the characteristics
of families who enroll in premium assistance programs, their experiences in
using the program, and what happens when they disenroll.
This Issue Brief summarizes findings from a Child Health Insurance Research
Initiative (CHIRI™) project that compared Oregon SCHIP enrollees with
low-income children who enrolled in the Oregon Family Health Insurance Assistance
Program (FHIAP)—the State's premium assistance program. In Oregon,
eligible families can choose to participate in either FHIAP or SCHIP because
the eligibility requirements for both programs are the same.
Researchers found:
- Approximately one-fourth of FHIAP and SCHIP families had access to employer-sponsored
insurance. As a result, 70 percent of FHIAP families purchased their coverage
in the individual market.
- FHIAP and SCHIP enrollees reported similarly high levels of health
care access and satisfaction with the programs after enrollment.
- SCHIP enrollees were more likely to be Hispanic and have parents
who were less educated and less likely to be employed or speak English
than FHIAP enrollees.
- Families who enrolled their child in FHIAP were more likely than
their SCHIP counterparts to have prior experience with private health insurance
coverage and paying premiums.
- Increases in family income were cited as the main reason for disenrollment
from FHIAP and from SCHIP.
- Two-thirds of SCHIP disenrollees and almost half of FHIAP disenrollees
who left public insurance became uninsured.
| "Many families who were enrolled in Oregon's premium assistance
program did not have access to employer-sponsored insurance." |
Oregon SCHIP and FHIAP
SCHIP serves Oregon children through the Oregon Health Plan, the State's
Medicaid program. At the time of the study, the Family Health Insurance Assistance
Program was a State-funded program initiated in 1998 that provided premium
subsidies to families. Families who choose to enroll in FHIAP can use the
subsidy to purchase employer-sponsored insurance or buy individual coverage
directly from insurers that are certified by the State to participate in
the program. Selected program components of SCHIP and FHIAP at the time of
the study are compared below.
| Component |
SCHIP |
FHIAP (Premium Assistance) |
| Eligibility* |
<170% of Federal poverty level |
<170% of Federal poverty level |
| Family coverage |
No |
Yes |
| Benefits |
Comprehensive—includes EPSDT |
More limited—few with dental services coverage |
| Cost-sharing |
None |
5-30% of premium plus co-payments and deductibles |
| Health care delivery system |
Capitated managed care plans |
Commercial health insurers |
Note: 170% of Federal poverty level = $30,770 for a family of four in 2002.
EPSDT: Early and Periodic Screening, Diagnosis, and Treatment program.
* Oregon raised the eligibility for SCHIP and FHIAP from 170 percent to 185 percent of the Federal poverty level in 2002 after this study was conducted.
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What Was Learned
Researchers conducted surveys in 2002 of families who enrolled their child
in either the Oregon premium assistance program (FHIAP) or SCHIP to study the
factors that affect parental choice and compare program effects. Although FHIAP
and SCHIP differ in several key areas (see text box), the eligibility requirements
for the programs are identical.
Most FHIAP Families Obtained Coverage in the Individual Market
Parents of FHIAP enrollees were somewhat more likely to be employed than
parents of SCHIP enrollees. However, 70 percent of FHIAP families did not have
access to employer-sponsored health insurance and, thus, purchased their coverage
in the individual market. Only 50 percent of children enrolled in either program
had health insurance coverage at some point in the year prior to enrollment.
Families of enrollees cited the high costs of health insurance as the main
reason for the lack of coverage.
FHIAP and SCHIP Enrollees Reported Similar Primary Care Access and Program
Satisfaction
Nearly all children in FHIAP and SCHIP reported that they had a regular source
of care. FHIAP enrollees were more likely to obtain their care in a physician's
office whereas SCHIP enrollees were more likely to receive their care from
clinics or community health centers. Both groups of enrollees rated their health
care very highly and were equally satisfied with their health care benefits.
SCHIP enrollees reported higher levels of unmet need for specialty care services
than FHIAP enrollees (11 percent versus 4 percent). Enrollees in FHIAP and
in SCHIP reported high levels of unmet need for dental care services with the
greatest need being among enrollees in FHIAP. Barriers to obtaining dental
care were attributed to high costs and lack of dental coverage in the health
plan (FHIAP enrollees), and a lack of participating dentists in the program
(SCHIP enrollees).
Over Half of FHIAP Families Thought They Were Ineligible for SCHIP
Applications for both SCHIP and FHIAP advise applicants that they may be eligible
for either program. When asked if they had heard of the other program, nearly
all of FHIAP parents (96 percent) knew about SCHIP; many of them (47 percent)
had been previously enrolled in the program. In contrast, only 14 percent of
SCHIP parents had heard of FHIAP.
When FHIAP families were asked why they chose
FHIAP instead of SCHIP, 52 percent of families were under the mistaken impression
that their child was ineligible for SCHIP. Other major reasons for why families
chose FHIAP over SCHIP included a preference for private rather than public
insurance coverage (16 percent), a desire to cover the entire family (16 percent),
and a wish to keep their current health plan or doctor (7 percent).
Prior Insurance Experience, Education Level, and Employment Were Factors
in Program Enrollment
Families with more highly educated parents and those in which at least one
parent was employed were significantly more likely to enroll in FHIAP than
SCHIP. Parents' prior experience with paying premiums and belief that
health insurance protects against future health care needs also made it more
likely for them to enroll their child in FHIAP. A greater proportion of SCHIP
families were Hispanic compared with FHIAP enrollees (29 percent versus 8 percent).
Moreover, Hispanic parents who did not speak English were much less likely
to enroll their children in FHIAP than non-Hispanic parents who spoke English.
The child's health status, including the presence of a special health
care need, was not a factor in program enrollment.
A Significant Proportion of Public Insurance Disenrollees Became Uninsured
Over half of low-income children who disenrolled from FHIAP and SCHIP no longer
qualified for the program. An increase in income was the primary reason for
disenrollment reported by families who reapplied for either program (80 percent
and 67 percent of SCHIP and FHIAP disenrollees, respectively).
FHIAP children who disenrolled from public insurance were more likely to
have health insurance coverage than those leaving SCHIP. However, almost half
of FHIAP disenrollees became uninsured after leaving public insurance (Figure 1). Among SCHIP disenrollees, more than two-thirds became uninsured.
Over one-third of FHIAP disenrollees and over one-fourth of SCHIP disenrollees
obtained employer-sponsored insurance after leaving the programs. A smaller
proportion of disenrollees in both programs obtained coverage through the individual
market. Two-thirds of public insurance disenrollees who had to pay a premium
for their insurance said it was a moderate or big hardship.
| “Premium assistance and SCHIP did not guarantee a bridge to unsubsidized
private health insurance coverage—many low-income families were
unable to afford coverage despite increases in family income.” |
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Conclusion
Until recently, few States offered premium assistance programs, in part because
low-income families have limited access to employer-sponsored insurance and
in part because such programs are complex to administer. Since the Health Insurance
Flexibility and Accountability (HIFA) demonstration began, however, implementing
premium assistance programs has become somewhat simpler. However, lack of employer-sponsored
coverage options for low-income workers remains a key barrier to implementing
these programs in many States.
This CHIRI™ study is instructive to States
considering premium assistance programs. First, it shows that low-income families
will enroll their child in premium assistance programs even without access
to employer-sponsored coverage if the State offers the option of purchasing
individual coverage. However, providing individual coverage through this route
is expensive; as a result, Oregon limits enrollment in individual health plans.
As of January 2007, over 7,000 families were on a FHIAP waiting list for an
application for individual coverage.
Second, many private health insurance plans do not cover dental services.
FHIAP enrollees were more likely to report unmet need for dental care.
Third, premium
assistance programs may not reach and appeal similarly to all groups of low-income
families. For example, Hispanic families were more likely to enroll in SCHIP.
This finding may reflect the provider networks associated with SCHIP versus
FHIAP. Safety net providers (e.g., community health centers) typically provide
on-site interpreters and other culturally sensitive services, making services
more accessible for Hispanic and other non-English speaking families.
These
providers are often not part of private insurance networks. Additionally, the
difference between enrollees in the two programs may reflect variations in
outreach and enrollment strategies as well as in processes of communicating
with applicants about their program options.
Finally, and perhaps most importantly, FHIAP disenrollees from public insurance
were only slightly less likely to be uninsured than SCHIP disenrollees. Many
policymakers view premium assistance programs as a strategy for encouraging
participation in private health insurance markets and promoting transitions
to employer-sponsored health insurance.
However, this CHIRI™ study found
that many low-income families were unable to maintain private insurance coverage
when they no longer received premium subsidies, despite increases in income.
Over 85 percent of disenrolled families in the study reported that they would
have kept their children in SCHIP or FHIAP if possible.
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Policy Implications
This CHIRI™ study provides State policymakers with several strategies
to consider when designing and implementing premium assistance programs
for low-income children and families. These strategies include the following:
- Consider how low-income families who do not have access to employer-sponsored
insurance might be covered under a premium assistance program, such as
allowing families to purchase individual coverage.
- Consider the affordability of private coverage for low-income families
when setting eligibility limits for premium assistance programs. Even when
employer-sponsored insurance for children is available, substantial coinsurance
(e.g., copayments) is often required.
- Educate families about their options for all relevant public insurance
programs in multilingual program outreach and enrollment materials. Materials
might include information on the importance of health insurance, how it
works, and how to effectively participate in private insurance programs.
- Encourage private health insurance plans participating in premium
assistance programs to tailor programs and services to Hispanic and non-English
speaking enrollees.
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Study Methodology
This CHIRI™ Issue Brief is based on a study of children age 17 and younger
who were randomly selected from administrative enrollment files for FHIAP and
SCHIP (one child per family). Because of FHIAP's small enrollment size,
its sample was comprised of all families enrolled in the program. Telephone
interviews were conducted in English and in Spanish in 2002 with the adult
in the household most knowledgeable about the child's health insurance,
usually the child's mother.
Researchers achieved similar response rates
for FHIAP (339 children) and SCHIP (1,206 children) (59 and 53 percent, respectively).
Primary reasons for non-response were inability to locate the family due to
disconnected phone lines, lack of a forwarding address, and other difficulties
in contacting families.
Two groups were sampled from each program:
- Currently enrolled children.
- Children who had been disenrolled for a minimum of 2 and a maximum of
4 months at the time the sample was drawn.
The minimum time frame was set to
allow time for those families who forget to re-enroll when the eligibility
period expires but then quickly reapply when they realize that coverage has
lapsed. The maximum time period was identified to ensure that families could
more easily recall their child's experience while enrolled in the program.
Multivariate analyses were used to examine the differences between parents
who enrolled their children in FHIAP versus those who enrolled their children
in SCHIP. Multivariate analyses were also used to determine whether there were
systematic differences in several outcome areas (insurance coverage, type of
coverage, premium requirement, financial hardship, interest in remaining enrolled
in the program, usual source of care, service use, and unmet needs) between
children who disenrolled from SCHIP and FHIAP, after controlling for child
and parental characteristics.
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Sources and Related Studies
Alker J. Premium assistance programs: how are they financed and do States
save money? Washington, DC: Kaiser Commission on Medicaid and the Uninsured.
2005.
Alker J. Serving low-income families through premium assistance: a look at
recent State activity. Washington, DC: Kaiser Commission on Medicaid and the
Uninsured. 2003.
Curtis RE, Neuschler E. Premium assistance. The Future
of Children 13(1):214-223;
2003.
Herman M. Premium assistance programs: Potential help for the uninsured?
Washington, DC: National Conference of State Legislatures. 2004.
Lutzky AW, Hill I. Premium assistance programs under SCHIP: not for the faint
of heart? Washington, DC: The Urban Institute. 2003.
Mitchell J, Haber S, Hoover
S. What happens to children who lose public health insurance coverage? Medical
Care Research and Review 63(5): 623-635; 2006.
Mitchell J, Haber S, Hoover
S. Premium subsidy programs: who enrolls and how do they fare? Health
Affairs
24(5):1344-1355; 2005.
Shirk C, Ryan J. Premium assistance in Medicaid and SCHIP: ace in the hole
or house of cards? Washington, DC: National Health Policy Forum. 2006.
Shirk C. Premium assistance toolbox for States: assisting States to develop
premium assistance programs. Portland, ME: National Academy for State Health
Policy. Available at: http://www.patoolbox.org/.
Williams C. A snapshot of State
experience implementing premium assistance programs. Portland, ME: National
Academy for State Health Policy. 2003.
Wooldridge J, Hill I, Harrington M, et al. Interim evaluation report: congressionally
mandated evaluation of the State Children's Health Insurance Program.
Princeton, New Jersey: Mathematica Policy Research, Inc. and Washington, DC:
The Urban Institute. 2003.
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About CHIRI™
The Child Health Insurance
Research Initiative (CHIRI™) is an effort to supply policymakers with information to help them improve access to, and the quality of, health care for low-income children. Nine studies of public child health insurance programs and health care delivery systems were funded in the fall of 1999 by:
- The Agency for Healthcare Research and Quality (AHRQ).
- The David and Lucile Packard Foundation.
- The Health Resources and Services Administration (HRSA).
These studies seek to uncover which health insurance and delivery features work best for low-income children, particularly minority children and those with special health care needs.
The CHIRI™ project “Medicaid SCHIP vs. Premium Subsidy: Oregon's
Health Insurance Alternatives for Low-Income Children” (Principal Investigator:
Janet B. Mitchell, RTI International) contributed to this Issue Brief.
This CHIRI™ Issue Brief was written by Karen VanLandeghem, Cindy Brach,
Jennie Bonney, and Lisa Kretz, based on articles by Janet B. Mitchell, Susan
G. Haber, and Sonja Hoover:
- Premium subsidy programs: who enrolls
and how do they fare?” Health Affairs, 24(5):1344-1355, September/October
2005.
- What happens to children who lose public health insurance
coverage?” Medical Care Research and Review, 63(5):623-635. October 2006.
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CHIRI™ Funders
AHRQ, part of the U.S. Department of Health and Human Services, is the lead agency charged with supporting research designed to improve the quality of health care, reduce its costs, address patient safety and medical errors, and broaden access to essential services. AHRQ sponsors and conducts research that provides evidence-based information on health care outcomes; quality; and cost, use, and access.
The David and Lucile Packard Foundation is a private family foundation that provides grants in a number of program areas, including children, families and communities, population, and conservation and science.
The Health Resources and Services Administration, also part of the U.S. Department of Health and Human Services, directs national health programs that provide access to quality health care to underserved and vulnerable populations. HRSA also promotes appropriate health professions workforce supply, training, and education.
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For More Information
More information on CHIRI™ projects can be found at http://www.ahrq.gov/chiri/.
Let us know how you use CHIRI™ research findings by contacting chiri@ahrq.gov.
Topics of future CHIRI™ Issue Briefs include:
- Could medical providers improve low-income children's access to
dental care?
- What is the impact of public insurance program design on provider
availability and enrollees' use of care?
- What role does SCHIP play in the patchwork insurance system for children?
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AHRQ Publication No. 07-0022
Current as of March 2007
Internet Citation:
Who Enrolls in Oregon's Premium Assistance Program and
How Do They Fare? CHIRI™ Issue Brief No. 6. AHRQ Publication No. 07-0022,
March 2007. Agency for Healthcare Research and Quality, Rockville, MD. http://www.ahrq.gov/chiri/chiribrf6/chiribrf6.htm
540 Gaither Road Rockville, MD 20850