GAO

United States General Accounting Office

Report to the Ranking Minority Member,

Committee on Commerce, House of

Representatives

April 2000 MEDICAID AND

SCHIP

Comparisons of

Outreach, Enrollment

Practices, and Benefits

GAO/HEHS-00-86

Page 1 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Contents

Letter 3

Appendixes Appendix I: Medicaid and SCHIP Outreach Activities 12

Appendix II: Application and Eligibility Determination 16

Appendix III: Screening and Enrollment 21

Appendix IV: Benefits 24

Appendix V: Comments From the Health Care Financing

Administration 27

Tables Table 1: Enrollment Practices for Medicaid and SCHIP in 10

States 22

Table 2: SCHIP Coverage Limitations on Optional Benefits in 10

States 24

Figures Figure 1: Extent of Combined Outreach for Medicaid and SCHIP

in 10 States 13

Figure 2: Additional Information and Documentation Required

for Medicaid in 10 States 18

Abbreviations

EPSDT Early and Periodic Screening, Diagnostic, and Treatment

FPL federal poverty level

HCFA Health Care Financing Administration

SCHIP State Children's Health Insurance Program

SSN Social Security number
Page 2 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons
Page 3 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

United States General Accounting Office

Washington, D.C. 20548

Health, Education, and

Human Services Division

B-285033 Letr

April 14, 2000

The Honorable John D. Dingell

Ranking Minority Member

Committee on Commerce

House of Representatives

Dear Mr. Dingell:

Two federal-state partnerships, Medicaid and the State Children’s Health

Insurance Program (SCHIP), offer states the opportunity to provide health

insurance coverage to low-income children. Medicaid, established in 1965

to provide health care coverage to certain categories of low-income adults

and children, reported enrollment of 22.3 million children as of September

1998. SCHIP, established in 1997 to expand health care coverage to

uninsured low-income children not eligible for Medicaid, reported

enrollment of nearly 2 million children as of September 1999. In designing

SCHIP, states had the option of expanding their Medicaid programs,

constructing a stand-alone program that operates separately from

Medicaid, or developing some combination of both approaches. More than

half of the states have chosen SCHIP approaches that are, to varying

degrees, separate from their Medicaid programs.

Concerned that program differences may create inadvertent disparities

between SCHIP and Medicaid, you asked us to review enrollment practices

and benefits available in a sample of states. In this context, we analyzed the

differences between both programs with regard to outreach, application

and eligibility determination, screening and enrollment, and benefits. For

this study, we analyzed responses to questions on these issues given by

Medicaid and SCHIP officials in 10 states with SCHIP programs that were

essentially separate from their Medicaid programs; we also obtained

documentation, such as applications, on their Medicaid and SCHIP

programs.1 We also interviewed officials from the Health Care Financing

Administration (HCFA), which has oversight responsibilities for both

1

The 10 states we reviewed are Alabama, Arkansas, California, Colorado, Florida, Kansas,

North Carolina, New York, Pennsylvania, and Utah. Within its Medicaid program, Arkansas

has two distinct components: ConnectCare and ARKids First. The state is hoping to use

ARKids First as a SCHIP stand-alone component. Arkansas has about 900 children enrolled

in its SCHIP Medicaid expansion as of fiscal year 1999.
B-285033

Page 4 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

SCHIP and Medicaid. We performed our work in March and April 2000 in

accordance with generally accepted government auditing standards.

Results in Brief Across our sample of 10 states, Medicaid and SCHIP programs are similar

in terms of their outreach mechanisms, but have differences in the way

they enroll children and the scope of the benefits they offer. Certain

information that is federally required for Medicaid eligibility determination

is not required for SCHIP.2 However, half of the states we surveyed required

more documentation for Medicaid than for SCHIP, and states often required

more documentation for Medicaid than was federally required. States do

have the flexibility under federal law to streamline requirements for

Medicaid and SCHIP. Additionally, while all of the states in our sample

reported policies and procedures to ensure that eligible children were

appropriately enrolled in Medicaid rather than SCHIP, the ease with which

Medicaid-eligible children were enrolled varied. In some cases, persons

applying for Medicaid for their children were required to fill out additional

forms or appear in person in order to determine eligibility and obtain

coverage. Finally, our review of five optional benefits (dental, hearing,

mental health, prescription drugs, and vision) shows that while states’

SCHIP programs offer many of the same benefits as Medicaid, SCHIP

imposes more limits on these benefits.

2

For example, Medicaid requires that applicants provide the Social Security number (SSN)

of children who are applying for benefits, while SCHIP does not.
B-285033

Page 5 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Background Authorized under title XIX of the Social Security Act, Medicaid is a joint

federal-state entitlement program that annually finances health care

coverage for more than 40 million low-income individuals, over half of

whom are children. Medicaid coverage for children is comprehensive,

offering a wide range of medical services and mandating coverage based

upon family income in relation to the federal poverty level (FPL). Federal

law requires states to cover children up to age 6 from families with incomes

up to 133 percent FPL, and children ages 6–15 up to 100 percent of FPL.3

Medicaid benefits are particularly important for children because of

Medicaid’s Early and Periodic Screening, Diagnostic, and Treatment

(EPSDT) services. EPSDT, which is mandatory for categorically needy

children,4 provides comprehensive, periodic evaluations of health and

developmental history, as well as vision, hearing, and dental screening

services to most Medicaid-eligible children.5 Under EPSDT, states are

required to cover any service or item that is medically necessary to correct

or ameliorate a condition detected through an EPSDT screening, regardless

of whether the service is otherwise covered under a state Medicaid

program.

3

Children ages 15–18 are generally covered if their family incomes are below the state’s cash

assistance standard for families in effect on July 16, 1996.

4

See 42 U.S.C. sec. 1396a(a)(10)(A).

5

The EPSDT benefit is optional for the medically needy population, an optional category of

eligibility for individuals who generally have too much income to qualify for Medicaid, but

have “spent down” their income by incurring medical and/or remedial care expenses. See 42

U.S.C. sec. 1396a(a)(10)(C). If a state chooses to provide one EPSDT service, it must

provide all EPSDT services to all medically needy individuals under age 21.
B-285033

Page 6 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

SCHIP, created under title XXI of the Social Security Act, authorized nearly

$40 billion in federal matching funds over fiscal years 1998 to 2008 for

states to offer coverage to children in families with incomes up to 200

percent of the FPL who do not qualify for Medicaid.6 In designing their

SCHIP programs, most states chose to establish separate, stand-alone

components, often concurrent with a Medicaid expansion.7 As of

September 30, 1999, the majority of the almost 2 million SCHIP enrollees—

nearly 1.3 million—were in states’ stand-alone programs, while about

700,000 were in Medicaid expansions. While states with a SCHIP Medicaid

expansion must provide the same coverage available to other children

enrolled in Medicaid, states with SCHIP stand-alone components have a

wide range of options to use in designing their benefit packages, including

the benefits available under a state’s Medicaid program. SCHIP stand-alone

components must cover basic benefits such as physician services, inpatient

and outpatient hospital services, and laboratory and radiological services.

However, states have discretion to provide optional benefits such as

prescription drugs and hearing, mental health, dental, and vision services

on a more limited basis, or not at all.

6

Recognizing the variability in state Medicaid programs, the statute allows a state to expand

eligibility up to 50 percentage points above its existing Medicaid eligibility standard. For

example, Connecticut covers children up to 300 percent of the FPL for SCHIP.

7

As of April 7, 2000, 15 states had stand-alone SCHIP programs, 18 states had combination

programs, and 23 were expanding coverage exclusively through Medicaid, according to

HCFA. Most states chose stand-alone components for additional control over expenditures.

A state with a SCHIP stand-alone component may limit its annual contribution, create a

waiting list, or stop enrollment once the funds it budgeted for SCHIP are exhausted. See

Children’s Health Insurance Program: State Implementation Approaches Are Evolving

(GAO/HEHS-99-65, May 1999).
B-285033

Page 7 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

States with SCHIP stand-alone components are required to coordinate with

Medicaid, other public programs, and private insurance. One coordination

provision requires states to initially screen all SCHIP applicants for

Medicaid eligibility to ensure that Medicaid-eligible children are enrolled in

Medicaid—a process called “screening and enrollment.”8 States must

specify in their SCHIP plans how they have established a system that

identifies, refers, and enrolls eligible children in the appropriate program.

HCFA recently proposed regulations for SCHIP that emphasize the need for

states to facilitate enrollment of eligible children by offering outreach

activities and enrollment mechanisms similar to those in Medicaid. HCFA

encouraged but did not require states to streamline and coordinate their

outreach efforts, applications and processing time requirements,

enrollment options and enrollment sites; and to use continuous and

presumptive eligibility for both programs.9

Medicaid and SCHIP differ in some of their eligibility determination

requirements. Although self-reporting of required information is allowed by

both programs, Medicaid has post-eligibility requirements for verification

of income and assets through the use of an income eligibility verification

system; Medicaid also requires an applicant’s SSN. For both programs, noncitizens are required to document their immigration status or to have their

immigration status verified. While states are allowed to require

documentation from families to determine eligibility, HCFA noted, in its

September 1998 guidance to state Medicaid directors, that states have the

flexibility to determine documentation requirements.

Medicaid and SCHIP

Use Similar Outreach

Mechanisms, but

Enrollment Practices

and Benefits Differ

Medicaid and SCHIP programs are similar in terms of their outreach

mechanisms, but differ in the way they enroll children and the scope of the

benefits they offer. With regard to outreach, the states in our sample

employ a variety of approaches to inform families about the health

coverage programs available, and to assist them in the application process.

More than one-half of the states report using similar outreach mechanisms

for Medicaid and SCHIP—such as toll-free hotlines, posters, and

8

See sec. 2102(b)(3)(B) of the Social Security Act.

9

Continuous eligibility allows states to provide beneficiaries with continuous enrollment in

the Medicaid and SCHIP programs for up to 12 months without requiring an eligibility

redetermination. Using presumptive eligibility, states have the option of extending

immediate Medicaid or SCHIP coverage to children until a formal determination of

eligibility is made.
B-285033

Page 8 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

brochures. However, states differed in the extent to which they combined

their outreach strategies for the two programs. While some states found it

useful to combine such efforts, other states (such as Kansas and

Pennsylvania) mostly preferred a separate SCHIP outreach approach.

These states indicated that separate outreach strategies are intended in

part to overcome potential enrollment barriers that may exist due to the

perceived stigma of Medicaid in their states.

The amount of state money allocated or spent on outreach for each

program also differed considerably. Among the states able to provide

amounts for both programs, two states indicated that more was allocated

or spent for SCHIP outreach than for Medicaid outreach. For example,

Colorado estimated $10,000 in Medicaid outreach funds and about $700,000

budgeted for SCHIP. In contrast, Utah reported more spending for Medicaid

outreach ($716,000) than for SCHIP ($50,000). (Additional details on the

outreach mechanisms and states’ spending on outreach are available in

app. I.)

In many states in our sample, applying for Medicaid requires more selfreported information, documentation from families, or both to determine

eligibility than for SCHIP. Although 7 of the 10 states use, or are moving

toward using, a joint application for Medicaid and SCHIP, the eligibility

determination requirements were often not the same for the two programs.

In fact, for Medicaid, most states required additional information,

documentation, or both that was not required for SCHIP. For example, two

states—Arkansas and Utah—required families to document assets for

Medicaid, but not for SCHIP. One state—Alabama—required income to be

documented for Medicaid, but not for SCHIP. In addition, two states—

Arkansas and New York—required in-person interviews for enrollment in

Medicaid, whereas SCHIP applications could be completed by mail.10 Of the

10 states, four states offered continuous eligibility—regardless of changes

in family income or circumstances—for SCHIP but not Medicaid, while

one, New York, offered it for Medicaid but not SCHIP. Recertification

requirements were more similar for the two programs than states’

10While in-person interviews will still be required for Medicaid, New York plans to ease the

process through “facilitated enrollment,” which will begin in April 2000. Funded by the state,

facilitators in community-based settings (such as hospitals, clinics, schools, and libraries)

will be delegated the authority to conduct the required face-to-face interviews. The intention

is to make it possible for families to be interviewed during hours convenient to their work

schedules, including evenings and weekends.
B-285033

Page 9 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

application and eligibility requirements, although one state required an

interview for Medicaid but not SCHIP. (See app. II for additional details.)

While all of the states in our sample have established policies and

procedures to ensure that Medicaid-eligible individuals are enrolled in

Medicaid rather than SCHIP, the ease with which children were enrolled in

Medicaid varied. Some of the states used a central clearinghouse in which

Medicaid workers, other state employees, and/or private contractors

processed SCHIP and Medicaid applications jointly.11 In those states in

which the Medicaid and SCHIP staffs were located separately, the

applications were often transferred by mail. In three states—Alabama,

California, and New York—applicants with incomes below SCHIP

requirements were allowed to choose whether their application would be

processed for Medicaid.12 Additionally, in 6 of the 10 states—Alabama,

Arkansas, California, New York, Pennsylvania, and Utah—additional steps

were required to complete a Medicaid application. (See app. III for

additional details.)

Our review of five optional benefits (dental, hearing, mental health,

prescription drugs, and vision) shows that while states’ SCHIP programs

offer many of the same benefits as Medicaid, SCHIP programs place more

limits on these services than Medicaid programs do. Most commonly,

mental health and vision benefits are more limited under SCHIP than under

Medicaid. For mental health care, eight of the states in our sample limit the

number of outpatient visits or inpatient days allowed per year. Colorado

does not cover dental benefits under SCHIP, and seven states—Alabama,

Arkansas, Kansas, New York, North Carolina, Pennsylvania, and Utah—

limit selected dental services, primarily orthodontics. In addition, while all

10 of the states in our sample cover hearing screening examinations, at

least three states place limitations on hearing services. For example,

Arkansas’ ARKids First program does not provide hearing aids. Finally, four

states in our sample—Alabama, Colorado, New York, and North Carolina—

have limitations on all five of the optional benefits. (See app. IV for

additional details.)

11In contrast to SCHIP, which does not limit eligibility determination to particular

employees, state or county employees must make eligibility determinations for Medicaid

according to federal law.

12Beginning in April 2000, New York’s joint application will not allow applicants a choice;

referrals to and enrollment in the Medicaid program will be automatic.
B-285033

Page 10 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Agency and State

Comments

We provided HCFA and Medicaid and SCHIP program officials from the 10

states in our sample an opportunity to comment on this report.

HCFA officials concurred with our findings. In doing so, HCFA stressed the

importance of outreach activities for both Medicaid and SCHIP programs

and noted guidance it had provided to states in an effort to simplify

Medicaid eligibility and better coordinate activities between SCHIP and

Medicaid. HCFA further said that, while variation exists across states with

regard to outreach mechanisms, progress has been made over the past few

years. In particular, HCFA believes that SCHIP outreach efforts have

inspired Medicaid outreach for the first time in many states. HCFA also

stated that screening and enrollment procedures could be accomplished

more effectively in some states, and that reviews of these procedures have

been an important component of HCFA’s reviews of state programs. In

addition, HCFA stated that the differences between Medicaid and SCHIP

application procedures—specifically in-person interviews and additional

reporting and verification requirements—could be eliminated largely by

states under existing law. The full text of HCFA’s comments appears in app.

V.

HCFA and states’ Medicaid and SCHIP program officials provided technical

comments and additional information, which we have incorporated where

appropriate.
B-285033

Page 11 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

As agreed with your office, we plan no further distribution of this report

until 7 days from its date of issue, unless you publicly announce its

contents. We will send copies of this report to the Honorable Nancy-Ann

Min DeParle, HCFA Administrator, and other interested parties, and we will

make copies available to others on request. If you or your staff have any

questions regarding this report, please contact me at (202) 512-7114 or

Carolyn Yocom at (202) 512-4931. Other contributors to this analysis were

Catina Bradley, JoAnn Martinez, and Deborah A. Signer.

Sincerely yours,

Kathryn G. Allen

Associate Director, Health Financing

and Public Health Issues
Page 12 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Appendix I

Medicaid and SCHIP Outreach Activities ApApenednxidexiIs

The states in our sample employ a variety of outreach approaches to inform

families about the health coverage programs available and to assist them in

the application process. Such approaches range from toll-free hotlines to

radio and television advertisements to community involvement. More than

half of the state officials in our sample indicated that they have similar

outreach mechanisms in place for both programs. Despite the reported

similarities, however, the existence of similar outreach mechanisms for

both Medicaid and the State Children’s Health Insurance Program (SCHIP)

does not necessarily illustrate the utility or effectiveness of the

mechanisms in place. For instance, while one state noted it maintained tollfree hotlines for both programs, the phone lines differed considerably, with

one permitting callers to request that an application be sent to them by

mail, while the other instructs the caller to apply at the local county

assistance office. Other differences between Medicaid and SCHIP outreach

include the use of media such as radio and TV for SCHIP, as well as the

existence and use of SCHIP Internet sites that provide program information

and, in some instances, allow individuals to download applications.

A HCFA official informed us that the agency has been encouraging states to

combine outreach mechanisms for SCHIP and Medicaid. While efforts are

underway to coordinate Medicaid and SCHIP outreach, some differences

exist in the extent to which some states combine their Medicaid and SCHIP

outreach strategies (fig. 1).
Appendix I

Medicaid and SCHIP Outreach Activities

Page 13 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Figure 1: Extent of Combined Outreach for Medicaid and SCHIP in 10 States

a

The responses generally reflect answers from both SCHIP and Medicaid officials. However, where

reported information varied in any way between Medicaid and SCHIP, responses from SCHIP officials

only are noted above, and the differences are described in the footnotes below.

b

An Alabama Medicaid official indicated that some of the toll-free hotline efforts and brochures are

combined with SCHIP, given that the phone line refers people to SCHIP and then mails out SCHIP

brochures. Additionally, Alabama Medicaid indicated that most community efforts are combined

because all Medicaid outreach workers provide information about both programs.

c

A Colorado Medicaid official reported that some of the toll-free hotline efforts and brochures are

combined, while for school or community involvement, Medicaid is not combined with SCHIP.

d

Utah reported that it uses a mix of strategies in that some printed material and information phone lines

are combined, while others are not.

Source: GAO Survey of States, Mar. 2000.

Even when outreach efforts are not formally combined, advertising for one

program may also reach children eligible for the other program. For

example, Utah officials asserted that an outreach campaign targeting a

SCHIP or Medicaid population could not be confined to that discrete

population. According to these officials, a campaign targeting Medicaid will

identify children eligible for SCHIP, and outreach aimed at SCHIP families
Appendix I

Medicaid and SCHIP Outreach Activities

Page 14 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

will discover individuals potentially eligible for Medicaid. Therefore,

outreach strategies, whether distinct or combined, may reach families

eligible for either program. Medicaid and SCHIP officials in Kansas

similarly indicated that SCHIP advertising also reaches children who are

eligible for Medicaid. However, Kansas is beginning to streamline SCHIP

and Medicaid into one program under the same name. While the state is not

currently coordinating most outreach mechanisms between SCHIP and

Medicaid, efforts are underway to adopt a seamless approach.

In six states that reported separate outreach spending or allocations for

SCHIP and Medicaid, differences did exist in the extent to which they were

able to identify and report outreach efforts—and in the amounts of

spending. Some examples follow.

Two states indicated that more funds were available for SCHIP outreach

than for Medicaid. Colorado estimated $10,000 in state spending for

Medicaid outreach brochures, and about $700,000 budgeted for SCHIP.

Pennsylvania reported that $500,000 in state funds has been allocated for

Medicaid outreach compared to $808,250 in state funds for SCHIP.

Two states reported spending more for Medicaid outreach than for SCHIP.

Utah identified $716,000 for Medicaid outreach spending, which includes

the cost of outstationed workers who also process SCHIP applications. For

SCHIP, the state reported $50,000 in state spending on outreach.1 New York

also reported spending more for Medicaid once federal funds were added

into the total. In particular, the state reported spending $11.7 million in

federal funds associated with welfare reform for Medicaid outreach to

children and families; coupled with state spending of $1.2 million, Medicaid

outreach spending was much higher than SCHIP, which reported $3.38

million in state spending for outreach.

Two states were able to provide data on outreach spending for only one

program. Alabama reported $359,738 in total SCHIP outreach spending,

with $77,380 in state spending, but indicated that such information on

Medicaid outreach is not currently available. Arkansas reported $400,000 in

1

Utah indicated that there are significant costs that are not tracked directly because

outreach is considered an important component of the normal way of doing business. For

example, workers will go to health fairs and other activities to provide information on

Medicaid, SCHIP, and other programs.
Appendix I

Medicaid and SCHIP Outreach Activities

Page 15 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

state spending for its regular Medicaid program, but could not provide

spending amounts for its ARKids First program.

The remaining four states did not delineate spending within each program,

but rather provided a combined dollar figure for both Medicaid and SCHIP

outreach. For instance, California officials reported that the state spent

about $10 million relating to education and outreach for SCHIP and

Medicaid.2 Florida also provided a combined outreach figure of $550,000 in

state funds for both programs, Kansas reported $1.1 million for both

programs, and North Carolina indicated that the state spent more than $1.3

million in federal, state, and grant funds for SCHIP and Medicaid outreach,

$129,250 of which was state funding.

2

California further noted that total spending for the state’s joint outreach campaign is $21

million annually in state and federal funds.
Page 16 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Appendix II

Application and Eligibility Determination ApendxiI

In addition to supporting combined outreach efforts, HCFA has been

encouraging states to combine Medicaid and SCHIP enrollment efforts as

much as possible. The agency reported providing technical assistance and

has issued guidance about ways to best accomplish the coordination of

enrollment. While 7 of the 10 states in our survey currently use, or are

about to use, a joint application, HCFA’s monitoring visits to states also

emphasized the importance of looking beyond the joint application forms

and into the requirements associated with each program.1 In the 10 states

we surveyed, eligibility determination requirements for both information

and documentation were typically not the same for Medicaid and SCHIP.

Medicaid and SCHIP differ in some of their eligibility determination

requirements, mostly in requiring the state to verify self-reported

information for Medicaid applicants.

1

The seven states in our survey with joint applications are Alabama, California, Colorado,

Florida, Kansas, New York, and North Carolina. At the time of our study, New York was

planning to begin using a joint application statewide in April 2000; previously it had

conducted a pilot test of a joint application in New York City and other locations in the state.

The remaining three states have separate applications. Arkansas plans to implement a joint

application in July 2000. Pennsylvania contracts with seven different health plans to

administer SCHIP throughout the state, and each of the contractors uses a different

application. Utah SCHIP has a Medicaid addendum form for applicants who appear

Medicaid-eligible, although applicants may submit the additional information needed for

Medicaid in any format. According to HCFA, the vast majority of states with stand-alone or

combination programs rely on joint applications.
Appendix II

Application and Eligibility Determination

Page 17 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Both Medicaid and SCHIP allow applicants to self-report their income and

assets for purposes of eligibility determination. However, once an applicant

is determined eligible for Medicaid, states are required to have an income

and eligibility verification system that is used to verify an applicant’s

income and resources by requesting information from other federal and

state agencies.2 States have the authority to eliminate asset tests for

Medicaid.3 SCHIP has no income or asset verification requirements. Social

Security numbers (SSN) are required for Medicaid applicants but not for

SCHIP applicants.4

The states in our survey generally required the same information about

income and age of the child for both programs. However, most states

required more information for Medicaid than for SCHIP on other items. For

example, Arkansas, Colorado, and Utah required information about assets

for Medicaid, but not for SCHIP. Two states—Alabama and Arkansas—

required information about the parent’s SSN even when the parent was

applying for a child, while none of the states we surveyed required this

information for SCHIP.5

Similarly, 5 of the 10 states required more documentation from families for

Medicaid than for SCHIP on one or more eligibility criteria. For example,

although most states required families to provide documentation of income

for both programs, Alabama required income to be documented for

Medicaid, but not for SCHIP. Alabama, New York, and Utah also required

applicants for Medicaid to document deductions from income, such as

deductions for childcare, while this was not generally required for SCHIP.

Two states also required documentation of assets for Medicaid but not for

SCHIP (Arkansas and Utah), and two states required documentation of the

child’s SSN for Medicaid but not for SCHIP (Alabama and New York). (See

2

See 42 CFR 435.940 through 435.965.

3

See sec. 1902(r)(2) and 1931 of the Social Security Act. If a state dropped its asset

requirement after March 31, 1997, and wants to claim enhanced matching funds for eligible

children as a result of this change, it will need to ask about assets to determine which

children are eligible for the SCHIP-enhanced match.

4

Sec. 1137(a)(1) of the Social Security Act requires SSNs to be supplied only by Medicaid

applicants and recipients. On September 10, 1998, HCFA issued guidance for states that

reiterated these requirements and noted that SSNs of nonapplicant relatives are not

required.

5

Alabama Medicaid officials noted that they do not deny a child’s application if the parent’s

SSN is not provided, but that they prefer to have it to verify family income.
Appendix II

Application and Eligibility Determination

Page 18 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

fig. 2.) In some cases, states have more than one Medicaid application and

the documentation requirements can vary significantly. For example, in

addition to its joint Medicaid/SCHIP application for children, Florida has a

Medicaid application for families that includes food stamps and cash

assistance; using this application requires documentation of income,

assets, income deductions, and SSNs, as well as an in-person interview.

Utah, in addition to its shortened Medicaid application for children, also

has a more extensive application form for families applying for Medicaid

and other programs.

Figure 2: Additional Information and Documentation Required for Medicaid in 10 States

a

Alabama Medicaid noted that it can sometimes obtain this information from its state verification and

exchange system.

b

According to state officials, the application is not denied or held up if the family does not provide this

information.

c

The state requires this information only if the applicant is a noncitizen.

d

The state requires this information only if the parent is applying for Medicaid.
Appendix II

Application and Eligibility Determination

Page 19 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

e

The Florida responses in our table reflect requirements only for applications submitted through the

joint Medicaid and SCHIP application process.

f

If the child is not a citizen or if citizenship is in question, the state requires documentation of

immigration status.

g

SCHIP has more requirements than Medicaid.

h

A North Carolina Medicaid official told us that the application is not held up if this information is not

provided.

i

A Pennsylvania SCHIP official told us that citizenship documentation is required for SCHIP only if

citizenship is in question.

Source: GAO Survey of States, Mar. 2000.

The states’ applications reflected several strategies for handling the

different requirements for eligibility determination under the two

programs. State strategies included (1) requiring additional follow-up from

Medicaid-eligible applicants (for example, Alabama, New York,

Pennsylvania, and Utah); (2) asking SCHIP applicants for information not

required by the program (for example, Colorado’s application asks for asset

information, although asset information was required only for Medicaid;

and Alabama, Arkansas, and Colorado applications ask for both the child’s

and parent’s SSNs); (3) indicating that some questions were optional (for

example, California’s joint application indicates that SSNs are not required

for SCHIP); and (4) indicating that some sections of a joint application

related to only one program (for example, Colorado).

Of the 10 states, four offered continuous eligibility for both Medicaid and

SCHIP (Alabama, Florida, Kansas, and North Carolina).6 Five other states

offered continuous eligibility for SCHIP but not Medicaid (Arkansas,

California, Colorado, Pennsylvania, and Utah), while New York offered it

for Medicaid but not for SCHIP. Most states provided for 12 months of

continuous eligibility when it was offered, except in Florida, where

Medicaid children under age 5 had 12 months of continuous eligibility and

Medicaid children over age 5 and all SCHIP children had 6 months of

continuous eligibility.

Under current Medicaid law, without the continuous eligibility option,

states must recertify the eligibility of a Medicaid beneficiary whenever the

beneficiary’s financial circumstances change.7 Recertification requirements

6

Continuous eligibility allows an applicant to remain eligible for Medicaid, regardless of any

changes in circumstances, for a specified period of time.

7

Recertification requires applicants to report any changes in financial circumstances to the

Medicaid or SCHIP program, in contrast to continuous eligibility.
Appendix II

Application and Eligibility Determination

Page 20 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

for Medicaid and SCHIP were more similar in the states we surveyed than

application and eligibility requirements. Nine states required recertification

after 12 months for both programs. Florida required recertification after 12

months for Medicaid and after 6 months for SCHIP. The most common

methods for recertification involved mailing a form or a new application,

but New York also required an interview for Medicaid recertification but

not for SCHIP. Nearly all states required information about income for

Medicaid and SCHIP; several states required information about income

deductions, primarily for Medicaid. Arkansas and Utah required

information about assets for children applying for Medicaid. Alabama’s

Medicaid program also required information about the child’s and parent’s

SSNs, citizenship, and age of the child.
Page 21 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Appendix III

Screening and Enrollment ApendxiI

While all of the states in our sample have established policies and

procedures to assure that Medicaid-eligible individuals are enrolled in

Medicaid rather than SCHIP, the ease with which children were enrolled in

Medicaid varied. Some of the states used a central clearinghouse in which

Medicaid workers, other state employees, and/or private contractors

processed SCHIP and Medicaid applications jointly. Six states—Colorado,

Florida, Kansas, North Carolina, Pennsylvania, and Utah—implemented a

variety of approaches to ensure that Medicaid-eligible applicants were

automatically enrolled in or referred to Medicaid. For example, Kansas and

North Carolina utilized an eligibility system that simultaneously screens

and enrolls children in Medicaid or SCHIP. Even though Pennsylvania does

not have one standard SCHIP application, the state has evoked an “any

form is a good form” policy, whereby it transfers all applications for

Medicaid eligibility determination. In Utah, the SCHIP program contracted

with the state Medicaid agency to determine Medicaid and SCHIP eligibility

and to enroll applicants in the appropriate program.1 Three states—

Alabama, California, and New York—allowed applicants the option of not

being enrolled in Medicaid.2 The remaining state, Arkansas, required

applicants to submit separate applications for Medicaid. (See table 1.)3

1

Utah has a Medicaid addendum form for the SCHIP application for applicants whose family

income is in the state’s eligibility range for Medicaid. The applicants may submit the

additional information in any format. If this information is not provided, the application

cannot be considered for either SCHIP or Medicaid.

2

New York’s joint application will make referrals to the Medicaid program automatic.

3

While Arkansas is working on a combined form, the state currently has separate

applications for its ARKids First program, which covers Medicaid-eligible children, and

ConnectCare, which covers Medicaid-eligible children and adults. In the event that an

ARKids First applicant appears to be eligible for ConnectCare, he or she is notified and sent

an application. The applicant may apply for ConnectCare or instead choose to enroll in the

ARKids First component of the state’s Medicaid program.
Appendix III

Screening and Enrollment

Page 22 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Table 1: Enrollment Practices for Medicaid and SCHIP in 10 States

a

In Arkansas, the individual must submit a separate application for Medicaid.

b

California commented that in the event the entire joint Medicaid/SCHIP application is completed, no

further documentation would be required. However, the application indicates that some information is

only necessary for Medicaid; in the event an applicant was seeking SCHIP eligibility, additional

information and documentation would be required for Medicaid if the applicant was deemed ineligible

for SCHIP.

c

Under New York’s new joint application, applicants will no longer be able to opt-out of consideration for

Medicaid.

d

While New York will still require in-person interviews for Medicaid eligibility determinations, it will ease

the process through “facilitated enrollment,” which will begin in April 2000.

Source: GAO Survey of States, Mar. 2000.

States

If SCHIP applicant appears Medicaideligible

Additional steps required

for Medicaid

Automatic

enrollment

in Medicaid

Notification

of potential

Medicaid

eligibility

Applicant

can “optout” of

Medicaid

Alabama X Documentation,

telephone interview

Arkansas Xa New application

(ConnectCare),

documentation,

appear for an interview

California X Self-reported information,

documentationb

Colorado X None

Florida X None

Kansas X None

New York Xc New application for

Medicaid, documentation,

appear for an interviewd

North

Carolina

X None

Pennsylvania X Self-reported information,

documentation

Utah X Self-reported information,

documentation
Appendix III

Screening and Enrollment

Page 23 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Finally, some of the states in our sample reported that SCHIP screening and

enrollment policies have been an effective means of reaching Medicaideligible children. For example,

• Alabama reported that approximately 40,000 SCHIP applications were

referred for eligibility determination for Medicaid during the program’s

first fiscal year,4

• California reported that over 54,000 SCHIP applications were referred

for eligibility determination for Medicaid from April 1999 through March

2000, and

• North Carolina reported enrolling approximately 37,000 children into

the Medicaid program for state fiscal year 1999.

4

Alabama implemented its SCHIP program in February 1998.
Page 24 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Appendix IV

Benefits ApendxiIV

SCHIP limitations on benefits represent a departure from those offered to

children under Medicaid, primarily because of Medicaid’s Early and

Periodic Screening, Diagnostic, and Treatment (EPSDT), which covers any

service or item that is medically necessary. While nine of the states in our

sample cover all five of the selected optional benefits (prescription drugs,

and vision, mental health, hearing, and dental services) many of those

services are covered on a limited basis. (See table 2.) For example,

• Colorado does not cover dental benefits under SCHIP and seven

states—Alabama, Arkansas, Kansas, New York, North Carolina,

Pennsylvania, and Utah—limit dental services, primarily orthodontics.

• Similarly, a number of states place limitations on vision and hearing

benefits. Most commonly, states limit the number of eyeglasses or

hearing aids allowed per year.

• Four states—Alabama, Colorado, New York, and North Carolina—have

service limits on all five benefits. However, a North Carolina SCHIP

official asserted that its Medicaid and SCHIP benefit limitations are

essentially the same because the state uses an internal review process

for SCHIP children to determine whether service needs that are beyond

the scope of coverage cited below are medically necessary.

Table 2: SCHIP Coverage Limitations on Optional Benefits in 10 States

Optional benefits State Coverage limits on benefits for SCHIPa

Prescription drugs Alabama Require generic unless no equivalents are available

Arkansasa No limitations cited

California No limitations cited

Colorado Require generic unless no equivalents are available

Floridab Require generic unless no equivalents are available or brand name is medically necessary

Kansasc No limitations cited

New York Medically necessary prescriptions only; no experimental drugs

North Carolina USDA-approved drugs only; no experimental drugs

Pennsylvania No limitations cited

Utah Medically necessary prescriptions only; no experimental drugsd

Continued
Appendix IV

Benefits

Page 25 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Vision Alabama One exam and one set of glasses/year

Arkansas One exam and one set of glasses/year

California One set of glasses or contacts/year

Colorado $50 annual maximum toward purchase of vision hardware

Floridab One set of glasses every 2 years

Kansasc No limitations cited

New York One set of glasses/yeare

North Carolina One set of glasses or contacts/year

Pennsylvania Two sets of glasses/year

Utah One exam every 24 months for eye refractions, examinations

Mental health Alabama Inpatient: 30 days/year; outpatient: 20 visits/year

Arkansas No inpatient psychiatric care; outpatient limited to $2,500/year

California No limitations cited

Colorado Inpatient: 45 days/year; outpatient: 20 visits/year

Floridab Inpatient: 30 days/year; outpatient: 40 visits/year

Kansasc No limitations cited

New York Inpatient: 30 days/year; outpatient: 60 visits/year

North Carolina Prior approval needed for both inpatient and outpatient visits; outpatient visits limited to 26

visits/year; additional visits covered if approved in advance

Pennsylvania Inpatient: 90 days/year; outpatient: 50 visits/year

Utah Inpatient: 30 days/year; outpatient: 30 visits/year

Hearing Alabama Screening and hearing aids only

Arkansas Screening, no hearing aids

California Screening and hearing aids

Colorado Hearing screening and hearing aids up to $800/year

Floridab Routine screening and hearing aids

Kansasc No limitations cited

New York One exam/yearf

North Carolina Screening covered; prior approval is necessary for hearing aids

Pennsylvania One hearing aid set per year

Utah One exam every 24 months and hearing aids

Optional benefits State Coverage limits on benefits for SCHIPa

Continued from Previous Page
Appendix IV

Benefits

Page 26 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

a

For Arkansas, the benefit limitations cited in this table are for the ARKids First program, which is

separate from the state’s regular Medicaid program. The benefit package for Arkansas’ SCHIP

Medicaid expansion program is the same as Medicaid’s.

b

Benefits for Florida’s Healthy Kids program are reflected in the table. The state’s MediKids program

and the Children’s Medical Services Network for children with special health care needs use Medicaid

benefits.

c

While there are no apparent limitations on prescription drugs, vision, mental health or hearing for

Kansas SCHIP, the medical services must be deemed medically necessary by the managed care

contractors.

d

Utah’s SCHIP plan language explicitly states that the fact that the provider may prescribe, order,

recommend, or approve a prescription drug, service, or supply does not, of itself, make it an eligible

benefit, even though it is not specifically listed as an exclusion. A prescription must be medically

necessary regardless of the relief the drug provides for a medical condition.

e

New York supplies additional lenses and frames if medically necessary.

f

New York provides additional exams for hearing deficiencies.

Dental Alabama Two checkups/year with cleaning; $1,000/year maximum

Arkansas No orthodontics

California No limitations cited

Colorado Not covered

Floridab No limitations cited

Kansas No orthodontics

New York No orthodontics

North Carolina No pulling of impacted teeth

Pennsylvania No cosmetic or orthodontics

Utah No orthodontics, crowns, or root canals

Optional benefits State Coverage limits on benefits for SCHIPa

Continued from Previous Page
Page 27 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons

Appendix V

Comments From the Health Care Financing

Administration ApendxiV
Appendix V

Comments From the Health Care Financing

Administration

Page 28 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons
Appendix V

Comments From the Health Care Financing

Administration

Page 29 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons
Appendix V

Comments From the Health Care Financing

Administration

Page 30 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons
Appendix V

Comments From the Health Care Financing

Administration

Page 31 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons
Appendix V

Comments From the Health Care Financing

Administration

(201050) Letr Page 32 GAO/HEHS-00-86 Medicaid and SCHIP Comparisons
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