Why So Many Toddlers Are Losing Health Insurance
Many babies born to mothers who are covered by Medicaid are automatically eligible for that coverage during the first year of their lives. In a handful of states, the same is true for babies born to women covered by the Children’s Health Insurance Program. Yet, this smart approach is routinely undermined by another federal policy that requires babies’ eligibility be reevaluated on their first birthday. Although they’re likely still eligible for coverage, many of these toddlers fall through the cracks.
People often cycle in and out of Medicaid and CHIP, state/federal health programs for low-income residents, as their income or family circumstances change. Such “churning” is a long-recognized problem. The requirement that people renew their coverage annually may also cause hiccups.
“Many people lose Medicaid coverage for procedural reasons,” said Shelby Gonzales, senior health policy analyst at the Center on Budget and Policy Priorities. “But there are all sorts of things that are unique about babies turning 1” that present extra challenges.
“You hate any baby to lose coverage,” said Jill Hanken, a lawyer with the Virginia Poverty Law Center who has worked on this issue. “A 1-year-old needs to have consistency with their health care and visits with the pediatrician.” Regular well-baby visits ensure kids are developing properly and get scheduled vaccines, among other things.
One potential snag in retaining toddlers’ coverage is that their first-year review is pegged to their date of birth, which is generally different than the annual renewal date for other family members’ coverage.
In other instances, states that don’t seek babies’ Social Security numbers until they turn 1 may have a tougher time getting the income and other data they need to process the renewal, while others mistakenly ask for documentation proving the baby’s citizenship, which is not required if Medicaid or CHIP paid for their birth.
Antiquated computer systems sometimes automatically drop babies after their first birthday unless a renewal has been processed. This can be a problem in states that are behind in renewals, which is not uncommon as some have scrambled to implement the many requirements of the health law, Gonzales said.
It’s hard to quantify the extent of the problem nationally. An analysis of data from the 2014 American Community Survey of 700,000 children found children between the ages of 1 and 2 were less likely to be covered by Medicaid or CHIP than were infants. That suggests “some children may be losing Medicaid/CHIP coverage at their first birthday,” said Genevieve Kenney, codirector and senior fellow at the Urban Institute’s Health Policy Center.
One state offers a window on the problem. Connecticut Voices for Children, a policy research and advocacy organization, has tracked the issue closely for several years. In 2008 and 2009, 42 percent of babies who had been considered automatically eligible for Medicaid at birth lost their coverage at the end of the month they turned 1, compared with roughly 6 percent of babies who were in other Medicaid coverage groups, such as those whose mothers had employer-sponsored insurance.
By 2013, when Connecticut Voices revisited coverage gaps, Medicaid and CHIP coverage retention when infants turned 1 had improved significantly. Still, nearly 23 percent of babies with guaranteed coverage for their first year were uninsured after their first birthday, compared with less than 2 percent of other babies.
During that time, the state revised confusing notices to families that, for example, announced that coverage was ending for infants because, “You are not the right age to be eligible for this program.” Advocates also played a role by working to alert pediatricians and community services providers about the problem.
Though coverage for 1-year-olds has improved, “the problem still persists,” said Mary Alice Lee, senior policy fellow at Connecticut Voices for Children. Advocates hope that a new eligibility management system, scheduled to roll out next year, will make a difference.
Elsewhere, advocates in Virginia are also awaiting a computer system fix so that infants who were guaranteed Medicaid coverage for the first year aren’t automatically cancelled after their birthday. In the meantime, the state changed its policy so that a newborn’s Medicaid eligibility determination at one year is a streamlined renewal instead of a totally new application for coverage, said Hanken.
“We’re about halfway to a solution,” Hanken said.
Outdated technology is no excuse for states not addressing this longstanding problem, said Tricia Brooks, a senior fellow at Georgetown University’s Center for Children and Families.
Noting that these newborns are easily identified, Brooks said, “If nothing else, [state officials] could go in on a manual basis and trigger a review.”