NCPA - National Center for Policy Analysis

Expanding Public Coverage Has Not Helped Uninsured Children

June 27, 2000

Despite expansions in public health coverage for low-income children, there has been no reduction in the percentage of these children who are uninsured. The State Children's Health Insurance Program (SCHIP) implemented in 1997 was designed primarily to reach low-income children above the poverty level who were previously ineligible for Medicaid. A recent study finds that the percentage of low-income children with public coverage has increased while the percentage covered by private insurance has decreased sharply. As a result, there was no net reduction in the proportion of these children that are uninsured.

For those children in families earning less than 200 percent of poverty -- a group targeted by SCHIP -- the rate of public coverage increased from 29 percent to 33 percent from 1996-1997 to 1998-1999, while the rate of private coverage fell from 47 percent to 42 percent. The proportion of uninsured remained relatively unchanged at 19 and 20 percent respectively. Perhaps more telling are changes in the uninsured status of children with access to employer-sponsored coverage through a parent.

  • The percentage of low-income these children enrolled in private employer-sponsored coverage fell from 72 percent to 66 percent over the period 1996-1997 to 1998-1999.
  • Enrollment in public coverage increased from 10 percent to 14 percent.
  • The proportion of children with access to both types of coverage that remained uninsured remained the same at 11 percent.

These shifts may be explained by substitution of public coverage for private coverage. If so, expansions of public coverage have benefited children who already had private insurance, providing their families m with a lower-cost or free alternative, while doing little to help the uninsured.

Source: Peter J. Cunningham and Michael H. Park, "Recent Trends in Children's Health Coverage: No Gains for Low-Income Children" Issue Brief No. 29, April 2000, Center for Studying Health System Change, 600 Maryland Avenue, S.W., Suite 550, Washington D.C. 20024.


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