Department of Health and Human Services 

OFFICE OF 

INSPECTOR GENERAL 

JUNE GIBBS BROWN 

Inspector General 

MAY 1999 

OEI-05-98-00310 

THE CHILDREN’S HEALTH 

INSURANCE PROGRAM 

States’ Application and Enrollment Processes: 

An Early Report From the Front Lines 
OFFICE OF INSPECTOR GENERAL 

The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, is to 

protect the integrity of the Department of Health and Human Services programs as well as the 

health and welfare of beneficiaries served by them. This statutory mission is carried out through a 

nationwide program of audits, investigations, inspections, sanctions, and fraud alerts. The 

Inspector General informs the Secretary of program and management problems and recommends 

legislative, regulatory, and operational approaches to correct them. 

Office of Evaluation and Inspections 

The Office of Evaluation and Inspections (OEI) is one of several components of the Office of 

Inspector General. It conducts short-term management and program evaluations (called 

inspections) that focus on issues of concern to the Department, the Congress, and the public. The 

inspection reports provide findings and recommendations on the efficiency, vulnerability, and 

effectiveness of departmental programs. 

OEI's Region V prepared this report under the direction of William Moran, Regional Inspector 

General and Natalie Coen, Deputy Regional Inspector General. Principal OEI staff included: 

REGION HEADQUARTERS 

John Traczyk, Team Leader Wynethea Walker, Program Specialist

Nora Leibowitz, Project Leader

Rebecca Ogrodnick

To obtain copies of this report, please call the Chicago Regional Office at (312) 353-4124. 

Reports are also available on the World Wide Web at our home page address: 

http://www.dhhs.gov/progorg/oei 
EXECUTIVE SUMMARY 

PURPOSE 

To identify promising practices, barriers and issues related to the application and 

enrollment procedures of the Children's Health Insurance Program (CHIP). 

BACKGROUND 

It is estimated that approximately 12 million children in the United States are currently 

without health insurance. Many of these uninsured children are eligible for Medicaid but 

are not enrolled in the program. The Balanced Budget Act of 1997 created Title XXI of 

the Social Security Act, the Children’s Health Insurance Program. Title XXI provides $24 

billion over 5 years to develop health insurance programs for low-income children. States 

have the option to expand their existing Medicaid program, design a new children’s health 

insurance program or develop a program that combines these strategies. 

Studies have shown that applications and enrollment procedures may be a barrier to 

families applying for Medicaid. Consequently, the Health Care Financing Administration 

(HCFA) is encouraging States to streamline Title XXI applications and the application 

process. 

We conducted this study to identify promising approaches being used by States. We also 

sought to identify barriers and issues States are confronting in their implementation of 

CHIP programs. We hope that sharing the promising approaches and addressing 

emerging issues will be beneficial to both program administrators and potential program 

applicants. 

We collected blank application forms from 19 States that had CHIP programs in operation 

on or before July 1, 1998. We conducted on-site interviews with the State CHIP director 

or their designee, in seven States, concerning their CHIP application and enrollment 

procedures. Front-line workers, who assist families in completing CHIP applications, 

were also interviewed in these seven States. We held telephone discussions about CHIP 

applications and enrollment procedures with the remaining 12 program directors or their 

staff. 

States’ Application and Enrollment Processes 1 OEI-05-98-00310 
FINDINGS 

Emerging Application Formats and Enrollment Practices 

Many States are experimenting with CHIP application and enrollment practices. They are 

finding that short applications are quicker and easier to complete, but may necessitate 

further contacts with State agencies. Longer applications can deter people from applying 

for benefits. 

States are weighing tradeoffs when they develop joint applications. The average joint 

Medicaid/CHIP application is longer than the average CHIP-only application. The three 

States that use a single application for medical and other benefit programs tend to have 

longer applications. 

To improve access to CHIP for children whose parents do not speak English, many States 

make applications available in Spanish and other languages. We found that the average 

reading level of the CHIP applications we analyzed was 10th grade. The average CHIP 

applicant may find it difficult to comprehend many application questions. 

Most States make applications available at multiple sites and nearly all use toll-free 

telephone numbers to distribute CHIP applications and to provide program information. 

Most sampled States no longer require a face-to-face interview for CHIP or Medicaid and 

most now accept mail-in applications. 

Some States mentioned streamlined procedures and early effective dates of coverage as 

negating the necessity for presumptive eligibility. Other States mentioned administrative 

difficulties and other problems as reasons for not adopting presumptive eligibility. 

Barriers to Enrollment: Citizenship Dilemmas 

State CHIP administrators stated that noncitizens are reluctant to apply for CHIP. People 

involved in the CHIP application process stated that fear of being detected makes illegal 

aliens reluctant to complete an application even for their children who meet citizenship 

requirements. Qualified aliens are also reluctant to complete an application for their 

children, fearing that use of a public benefit will adversely affect their applications for 

citizenship. 

Multiple Program Rules 

Medicaid, CHIP and other public benefit programs differ in their rules regarding issues 

such as verification of alien status, child support enforcement and verification of income. 

Different policies also exist for determining: household/family composition, countable 

income, and disclosure of information. These differences hinder the development of joint 

States’ Application and Enrollment Processes 2 OEI-05-98-00310 
applications, affect application size and complicate verification procedures. States find 

themselves having to apply different rules for different programs, leaving them uncertain 

as to which program policies to apply in each case. States have concerns that their 

decisions regarding definitions of income and household/family composition and 

verification processes will affect their quality control error rate. 

RECOMMENDATIONS 

Readability of Application Forms 

We recommend that HCFA work with States to improve the readability of CHIP 

applications. The high reading level of some applications can dissuade prospective 

applicants from applying. Language complexity may lead applicants to incorrectly fill out 

forms, which may have an impact on whether applications for health care coverage are 

accepted or denied. Reducing language complexity and reading level on CHIP 

applications can improve access to services. 

Simplification Efforts 

We recommend that HCFA continue to encourage States to simplify their application and 

enrollment processes for CHIP and Medicaid. Many practices show encouraging results. 

However, it is too early to determine the effectiveness of these practices. 

We encourage HCFA to continue to support State efforts to: 

< Reduce application length;

< Use joint Medicaid/CHIP applications;

< Use multi-program applications;

< Print applications in Spanish or other languages;

< Distribute applications at multiple sites;

< Utilize toll-free telephone lines to provide information;

< Provide assistance with the application process;

< Increase the use of outstation and application collection sites;

< Utilize mail-in applications and post-paid envelopes;

< Eliminate face-to-face interviews.

We also encourage HCFA to continue helping States investigate the following practices: 

< Contracting with enrollment brokers; 

< Eliminating some verification requirements. 

Under Medicaid, eligibility is effective with the date of application or, at State option, the 

States’ Application and Enrollment Processes 3 OEI-05-98-00310 
first day of the Month of application. There is no requirement in the CHIP legislation that 

governs the effective date of CHIP eligibility. We recommend that HCFA encourage 

States with separated CHIP programs to adopt CHIP eligibility policies that parallel their 

Medicaid policies. We also recommend that HCFA encourage States to presume 

eligibility of all children effective with the date of application. 

Citizenship Issues 

We recommend that HCFA work with INS to encourage INS’s development of clear 

guidance and policy statements on how applications for CHIP and Medicaid will impact 

noncitizens. Qualified aliens should know whether using the CHIP benefit will affect their 

citizenship. Illegal aliens should know if the information they provide on CHIP 

applications for their citizen children will be used to enforce immigration laws. 

Uniformity of Program Requirements 

We recommend that an interagency task force be formed to address conflicting public 

benefit application requirements. We recommend that this interagency workgroup 

develop uniform policies for verifying income, using the Income Eligibility Verification 

System, determining household/family composition, defining countable income, counting 

child support and disclosing information. 

States’ Application and Enrollment Processes 4 OEI-05-98-00310 
TABLE OF CONTENTS 

EXECUTIVE SUMMARY ............................................... 1 

INTRODUCTION ..................................................... 6 

FINDINGS 

Emerging Application Formats and Enrollment Practices ................... 9 

Application brevity 

Joint applications 

Multi-program applications 

Spanish and other languages 

Readability 

Applications at multiple sites 

Toll-free telephone lines 

Application assistance 

Outstationing and collection sites 

Mail-in applications, post-paid envelopes 

Elimination of face-to-face interviews 

Presumptive eligibility 

Use of enrollment contractors 

Elimination of some verification requirements 

Denial rates 

Citizenship Dilemmas ............................................... 20 

The “illegal alien” dilemma 

The “public charge” dilemma 

Multiple Program Rules .......................................... 23 

RECOMMENDATIONS ............................................... 26 

AGENCY COMMENTS ................................................ 28 

APPENDICES 

Appendix A: Health Care Financing Administration Comments ............ 29 

Appendix B: Health Resources and Services Administration Comments ...... 34 

Appendix C: Assistant Secretary for Management and Budget Comments ..... 35 

States’ Application and Enrollment Processes 5 OEI-05-98-00310 
INTRODUCTION 

PURPOSE 

To identify promising practices, barriers and issues related to the application and 

enrollment procedures of the Children's Health Insurance Program (CHIP). 

BACKGROUND 

The Agency for Health Care Policy and Research estimates that approximately 12 million 

children have no health insurance. As many as 4.7 million uninsured children are eligible 

for Medicaid but are not enrolled in the program. More than 90 percent of these children 

are in working families. 

The Balanced Budget Act of 1997 (Public Law 105-33) created Title XXI of the Social 

Security Act, the Children’s Health Insurance Program (CHIP). The CHIP is a capped 

matching program which authorizes $24 billion over the next 5 years to establish and 

expand health insurance programs for low income, uninsured children. The CHIP 

program’s goal is to provide health insurance to children whose parents earn too much to 

qualify for Medicaid but not enough for private insurance. The program also seeks to 

cover uninsured children whose parents’ health insurance does not cover their dependents. 

The program allows States to expand their current Medicaid program, design a new 

children’s health insurance program or develop a program which combines these 

strategies. States that choose to expand the number of children eligible for Medicaid must 

follow existing Medicaid rules regarding family income, geography and residency. These 

“Medicaid expansion” programs must also offer the same benefit package their Medicaid 

recipients currently receive. States establishing separate CHIP programs may set their 

own eligibility standards within federally-established parameters and have more flexibility 

on the benefit package. 

Through Title XXI, States may cover children whose household/family incomes are higher 

than traditional Medicaid limits. Medicaid family income limits for children vary from 

State to State and can range from the Federal poverty level to 300 percent of poverty. 

Under Title XXI, States may choose to cover children whose family income is above the 

Medicaid threshold but less than 200 percent of poverty. States with Medicaid programs 

that currently cover children at or above 200 percent of poverty may raise their current 

eligibility standard as much as 50 percent. 

States’ Application and Enrollment Processes 6 OEI-05-98-00310 
Under CHIP, States receive higher Federal matching dollars than they do for Medicaid. 

The CHIP legislation requires that States use their Federal money to cover uninsured 

children who are not covered by Medicaid or private insurance. States must screen all 

children applying for CHIP for Medicaid eligibility. Medicaid-eligible children identified 

during outreach must be enrolled in Medicaid rather than in a separate CHIP program. To 

prevent States from moving children from Medicaid to the new program, the law prohibits 

States from receiving an enhanced match if they tighten the Medicaid eligibility standards 

that existed before March 31, 1997. 

Identifying and enrolling children are challenges facing States implementing CHIP. Title 

XXI requires States to conduct outreach and enrollment activities. Outreach involves 

locating children who are eligible for health insurance and enrolling them in Medicaid or 

CHIP. The goal is to assure that all children who qualify for publicly-subsidized health 

insurance get enrolled in the appropriate program. 

Studies have shown that applications may be a barrier to families applying for Medicaid. 

Reducing the length and complexity of Medicaid and CHIP applications may improve the 

uptake rate for eligible children. Researchers, advocacy groups and the Health Care 

Financing Administration (HFCA) have encouraged States to shorten their applications 

and simplify enrollment processes. 

On January 23, 1998 and September 10, 1998, HCFA issued letters to the States 

encouraging them to reduce the length and complexity of Medicaid and CHIP 

applications. Another HCFA letter sent to the States on November 23, 1998 encourages 

States to develop joint applications, simplify application process and eliminate (or 

streamline) efforts to verify information on Medicaid and CHIP applications. 

METHODOLOGY 

We collected CHIP application forms from 19 States. Most States have a single CHIP 

application form, but three States have multiple CHIP application forms. Overall, we 

collected and reviewed 41 different CHIP application forms provided by the 19 States in 

our sample. We analyzed the content of each application and the way questions are asked 

and how information is provided to applicants. 

We conducted site visits in seven States (AL, CA, CO, CT, FL, NJ, OK) that were 

enrolling children in a stand alone Title XXI program or a Medicaid expansion program. 

We discussed CHIP applications and enrollment procedures with State Medicaid and 

CHIP staff. Discussions were also held with front line workers, contractors and others 

involved with helping families apply for CHIP. We discussed application and enrollment 

procedures with the 12 remaining States (ID, IN, MA, MI, MO, NY, OH, OR, PA, RI, 

SC, TX) over the telephone. 

States’ Application and Enrollment Processes 7 OEI-05-98-00310 
We asked respondents about their CHIP application and requested information as to how 

and where families could obtain an application. We also asked how applicants could get 

help in completing an application and how they can submit an application. We focused on 

the application process, including how eligibility for Title XIX (Medicaid) and Title XXI 

(CHIP) is determined, what verification the State requires, whether contractors are used 

for any portion of the process and how referrals between Title XIX and Title XXI occur. 

We also asked about presumptive eligibility and application denials. 

We conducted a readability analysis of randomly selected CHIP applications. For each of 

the applications selected, we randomly selected instructions and questions for readability 

analysis. Software was used to analyze reading grade level and vocabulary complexity 

using the Flesch-Kincaid formula. This test is the standard test used by the Department of 

Defense to determine the ease of reading. It determines the complexity and reading 

difficulty using a formula based on average sentence length and average number of 

syllables per word. 

The information presented in this report is for the period July through October 1998. It is 

a point-in-time description. Many States we interviewed for this study are in the process 

of making changes to applications and enrollment procedures. Several States in our 

sample had implemented the first phase of their program and were in the planning stage of 

their second phase when we talked with them. The findings are based on the programs at 

the time we spoke with the States involved, and may not reflect subsequent 

implementation of second or third phase Title XXI programs. 

We conducted our review in accordance with the Quality Standards for Inspections issued 

by the President’s Council on Integrity and Efficiency. 

States’ Application and Enrollment Processes 8 OEI-05-98-00310 
FINDINGS 

Emerging Application Formats and Enrollment Practices 

States are advised to make their CHIP applications uncomplicated and user-friendly. 

Researchers, advocates and HCFA have asked the States to develop simpler application 

forms and to improve enrollment processes for Medicaid and CHIP. In their January 23, 

1998 letter to State health officials, HCFA stated that “a key to successfully enrolling 

children . . . is a simple application and enrollment process.” In an effort to improve 

application and enrollment processes, HCFA has advised States to shorten CHIP and 

Medicaid applications, develop joint applications, simplify language and minimize 

verification requirements. 

With HCFA’s encouragement many States have developed shorter applications not only for 

CHIP but also for their Medicaid programs. The Center for Budget and Policy Priorities 

believes that shortened applications will facilitate enrollment. The model joint MedicaidCHIP application developed by HCFA is four pages. It consists of two pages on which 

families enter information plus two pages of program explanations and descriptions of 

requirements. In the past, Medicaid applications were often long and complicated. 

The HCFA suggests making eligibility determination easier by eliminating asset tests and 

verification requirements that are not federally required. According to HCFA, States can 

accept an applicant’s responses on a Medicaid or CHIP application without verification. 

The HCFA also encourages States to eliminate face-to-face interviews, to allow mail-in 

applications and to streamline verification procedures. 

The HCFA has also encouraged States to use a combined application for their Medicaid 

and CHIP programs. The HCFA believes that joint Medicaid/CHIP applications would 

reduce State paperwork and simplify the process for families potentially eligible for CHIP 

and Medicaid. In a November, 1998 letter to State Health Officials, HCFA encouraged 

States to develop and use a joint application that could be used for CHIP, Medicaid and 

other public benefit programs such as food stamps, child care and cash assistance. The 

Center for Budget and Policy Priorities and the Children’s Defense Fund have praised 

several States for their streamlined application processes. 

Application brevity 

Of the 41 applications in our sample, the average application length was five and a half 

pages. When declaration pages and informational pages are removed, the average number 

of pages families are asked to complete drops to just over three pages. Over half of the 

States’ Application and Enrollment Processes 9 OEI-05-98-00310 
applications in our sample are four or fewer pages. More than 75 percent are six or fewer 

pages. One-fifth of all the applications studied were seven or more pages. The longest 

application was 28 pages. 

Application length, in itself, does not appear to be an accurate measure of application 

burden. Studies suggest that a short application may encourage more families to apply for 

Title XIX and Title XXI programs. Generally, application length is counted as the total of 

both the pages the family must complete and any pages of information, instructions and 

declarations attached to the “fill-in” pages. Some States include information, instructions 

and declarations in the application itself. Others print information and instructions on 

sheets not attached to the application. This may lead to unfair comparisons between State 

applications. A State that attaches two pages of instructions to two pages of fill-ins does 

not have a longer application than a State that prints the two sections on separate sheets. 

States make tradeoffs when developing applications. We examined an exceptionally long 

CHIP application. In addition to the actual application, the package given to potential 

applicants contains many pages of explanations, instructions, flow charts, cartoon 

descriptions of the process and other informational pages. The application, which is a joint 

CHIP/Medicaid form, contains more than 12 pages of instructions and explanations. Four 

pages of application questions help applicants estimate family income. 

Using this State’s application, a CHIP or Medicaid applicant would fill out 12 pages. This 

includes two pages of declarations and a checklist for required documentation. 

Respondents from this State indicated that the their application design was influenced by 

input from advocates and other groups. Staff at the State’s CHIP program said they 

included many advocate suggestions, which increased the application’s length. This State’s 

application illustrates the tradeoffs that States consider when deciding what information to 

include and what questions to ask in their CHIP/Medicaid applications. 

CHIP Application Length 

Application Type All Applications CHIP-only Joint Medicaid/CHIP 

Average Length 5.5 pages 3.8 pages 7.6 pages 

Median Length 4 pages 4 pages 6 pages 

Mode 4 pages 4 pages 4 pages 

Shortest and longest 1 - 28 pages 1 - 8 pages 2 - 28 pages 

States’ Application and Enrollment Processes 10 OEI-05-98-00310 
Joint applications 

Two States with CHIP-only programs use a separate CHIP application. Nine States with 

Medicaid expansions or combination CHIP/Medicaid programs use a single application. 

Eight States with CHIP-only programs use a joint CHIP/Medicaid application. 

Using a joint Medicaid/CHIP application can simplify the application process for some 

families. Families only have to complete one application and do not have to determine 

under which program their children may be eligible. Joint applications facilitate the 

enrollment of CHIP applicants in Medicaid if they qualify for that program. With both 

programs on one application, States can ensure that they enroll children who are Medicaid 

eligible in Medicaid and children eligible for CHIP are enrolled in CHIP. 

Joint applications help reduce the stigma associated with welfare by making program 

differences invisible to families. This may be especially important for families who do not 

want Medicaid due to its association with welfare. Many State CHIP directors provided 

anecdotal information about families refusing Medicaid but willing to accept, and in some 

cases willing to pay for CHIP. 

Joint applications are often longer than CHIP-only applications. Joint Medicaid/CHIP 

applications have to include questions a State requires for either program. The average 

length of a combined application is longer than that of an average CHIP-only application 

(7.6 pages versus 3.8 pages). Some State laws may prescribe information to be collected or 

processes for Medicaid applicants that are not required for their separate CHIP program. 

Joint applications may require families of CHIP-eligible children to go through a more 

invasive process, such as face-to-face interviews, added questions and more extensive 

verification of information provided. 

Multi-program applications 

Of the 19 States in our study, three use a single application form to determine eligibility for 

Medicaid/CHIP and at least one other public benefit program. One State combines its 

Medicaid application with applications for cash assistance and food stamps. A second State 

uses a single application for cash assistance, food stamps and child care subsidies. The 

third uses a combined application for its medical programs and the Women, Infants and 

Children (WIC) program. 

A single application for health care and other programs can be a good way to ensure that 

families have access to all the programs for which they qualify. When a family fills out a 

joint application, a State can determine eligibility for several State and Federal programs. 

Some families may not want to fill out separate applications and interact with their State’s 

social services agency multiple times. A multi-program application may increase access to 

both health programs and other programs such as food stamps and subsidized child care for 

these families. 

States’ Application and Enrollment Processes 11 OEI-05-98-00310 
The downside of a multi-program application is that different programs have different 

requirements. The issues surrounding joint Medicaid/CHIP applications are intensified 

with a multi-program application. States that use multi-program applications indicated that 

persons applying for subsidized health insurance often have face-to-face interviews because 

they are required for other programs. One State noted that much of its documentation and 

verification requirements are the result of the food stamps program requirements. 

As an alternative to multi-program applications, one State’s joint CHIP/Medicaid 

application includes check boxes. Applicants can indicate their interest in receiving 

information about other State and Federal programs by checking the appropriate box. 

Spanish and other languages 

Half the States running CHIP programs as of July 1, 1998 print their applications in both 

English and Spanish. Most of these States print English and Spanish versions separately. 

Two States print a single version of the application, with all instructions and questions in 

both languages. Five States make applications available in several languages. One State 

distributes instructions and applications in 10 different languages. Three States print 

applications only in English. 

All States offer telephone or in-person assistance to help non-English speaking persons 

apply for CHIP. Some States staff their toll-free help lines with bilingual staff. In addition, 

all States utilize telephone-based interpreter services. 

Readability 

Application complexity affects a reader’s ability to successfully and accurately complete a 

CHIP application without assistance. High reading level scores and complex vocabulary 

may hinder some people’s ability to complete a CHIP application. Subjective analysis of a 

text’s reading level is often inaccurate. Teachers and others with higher than average 

reading levels tend to underestimate the difficulty of a given text by up to 8 years. 

Using the Flesch-Kincaid Formula, we analyzed randomly selected application questions 

and instructions from a sample of CHIP applications. We found that most CHIP 

applications required a 10th grade education or higher to comprehend CHIP questions and 

instructions. The grade level of the questions and instructions we analyzed ranged from 

4.86 to 14.79. 

Contributing to the difficult reading level of CHIP applications is the complexity of the 

sentences and vocabulary used in questions and instructions. Complex sentences and 

vocabulary make comprehension more difficult for applicants. Compared with a 

Hemingway short story with a vocabulary complexity score of 5, the CHIP applications we 

examined had vocabulary complexity scores ranging from a low of 2 to a high of 71. 

States’ Application and Enrollment Processes 12 OEI-05-98-00310 
States have shown concern that applications are comprehensible to families. One State 

indicated that they changed a CHIP application question about the name of the person 

filling out the form. What once read “applicant’s name” now reads “your name.” This 

change avoids confusion caused when parents or others filling out a CHIP application 

entered a child’s name in the slot meant for their own name. Other States have also 

responded to problems with individual questions or instructions, but none indicated that 

they have performed comprehensive application overhauls based on readability analysis. 

Applications at multiple sites 

Most of the States in our study made applications available at multiple locations. These 

locations included State and local government offices, welfare and Medicaid offices, State 

and local health departments, county or city run health clinics and WIC clinics. In addition, 

many States distribute applications through community groups, churches, nonprofit 

organizations, private health care providers, Federally Qualified Health Centers (FQHCs), 

child care centers, Head Start centers and schools. Most States have made efforts to 

distribute applications at multiple sites. Some States have made noteworthy efforts to 

distribute CHIP application by offering hundreds of application pick-up sites throughout 

their States. See Table on the next page for a compilation of CHIP application sites 

mentioned by State respondents.1 

Many States are making efforts to solicit the cooperation of schools in identifying 

potentially eligible children. Schools in many States are asked to distribute information and 

applications to students. Eight States specifically mentioned that applications are available 

at schools and education departments. Many States noted that Department of Education 

cooperation was good. However, a couple of States indicated that local school districts 

were not always willing to distribute information and applications. One State felt that the 

Department of Education lacks a clear mandate to cooperate in this endeavor. 

Toll-free telephone lines 

Most States run a statewide, toll-free telephone line. People can call to these toll-free 

numbers to get program information and applications. Only three States do not make 

applications available via Statewide toll-free telephone lines. Two of these States contract 

with individual managed care organizations (MCOs) to run customer service lines as part 

of their programs. The contracted MCOs in these States provide information about CHIP 

and mail out applications to callers. The other State’s toll-free line can be used to get 

information about the program and referrals to the appropriate State agency. 

1

Figure 1 is a list of sites at which people can obtain CHIP applications. This list may not be 

comprehensive. It reflects only the sites mentioned by our State respondents. 

States’ Application and Enrollment Processes 13 OEI-05-98-00310 
Locations used by States to distribute CHIP applications 

Health Care Providers, including: 

< hospitals 

< State, city and county health departments 

< federally qualified health centers 

< county health clinics 

< community health centers 

< clinics run by the Women, Infants and Children program 

< dentist offices 

< Physicians and other health care provider offices 

Government offices, including: 

< Medicaid offices 

< welfare offices 

< regional offices of the State government 

< unemployment offices 

Schools, including: 

< State Department of Education offices 

< local school district offices 

< schools 

Community based organizations and not-for-profit agencies, including: 

< churches 

< libraries 

< private social service agencies 

< advocacy groups 

< boys and girls clubs 

< domestic violence shelters 

< food banks 

Other organizations, agencies and businesses, including: 

< managed care organizations 

< contractors and enrollment brokers 

< pharmacies 

< child care centers 

< Head Start centers 

< legal services offices 

< tax preparers’ offices 

< insurance agencies 

< grocery stores 

States’ Application and Enrollment Processes 14 OEI-05-98-00310 
Application assistance 

Most States offer assistance with application-related questions by telephone. In several 

States, the staff answer questions and explain what documentation should be sent in. In 

some States, staff on the toll-free line will help families fill out an application. The 

completed application is then sent to the family for a signature and needed documents. 

Several States train groups and individuals not employed by the State to help families with 

the application process. In one State, organizations sponsor individuals to attend a daylong training on the application. These individuals are then approved to assist families with 

the application on behalf of their organization. In another State, more than 300 interested 

organizations have signed agreements with the State regarding training and their role in the 

initial processing of the applications. 

State Medicaid or CHIP web sites describe their programs and explain how to get an 

application. Several States allow families to print the application from the web site, fill it 

out and mail it in. 

Outstationing and collection sites 

About one quarter of the States in our study relies, at least in part, on outstationed workers 

to collect applications. Many States allow families to return applications to places other 

than welfare or Medicaid offices. These sites include health departments, Federally 

Qualified Health Centers, clinics and other agencies that volunteer to help families with the 

process. Several States report that they increased the number of application drop-off sites 

in order to help families avoid the welfare or social services office. In some States, 

applications dropped off at an outstation or volunteer agency site will be forwarded to the 

processing organization. In one State, outreach sites (including medical providers) can fax 

in families’ applications for them, and then send the paper copy by mail later. They hope 

that eliminating the stigma of welfare and making the process friendlier will encourage 

more families to apply. 

Rather than increase the number of outstation sites, several States collect CHIP 

applications predominantly or exclusively through a mail in process. Many of these States 

distribute post-paid envelopes with their applications and encourage families with questions 

to call the toll-free help line. 

Mail-in applications, post-paid envelopes 

In its January 1998 letter to State health officials, HCFA stressed the benefits of mail-in 

applications, noting that they can reduce enrollment barriers found with in-person 

applications. Mail-in applications keep families out of the social services office, thus 

reducing transportation costs, avoiding the stigma of the welfare office and eliminating the 

States’ Application and Enrollment Processes 15 OEI-05-98-00310 
need to miss work. In addition, HCFA noted that mail-ins increase the number of 

organizations that can help distribute applications and information to potentially eligible 

families. 

Many States currently have mail-in Medicaid applications, and all but one of the States in 

our study use it for Title XXI applications. Over half the States in our study provide 

applicants with a post-paid envelope in which to return their application. States that 

provide a post-paid envelope indicate that they do so to encourage families to return their 

applications. Several States noted that they did not want low-income applicants to put off 

getting their children insured because they did not have the money for postage. 

States not using post-paid envelopes had several reasons for this decision. One State 

reports that post-paid envelopes increase the mailing time. This State claims that the extra 

processing time required to process post-paid envelops delays receipt of applications. 

Several States indicate that the weight of required documents varied from family to family. 

This variability, in weight, makes it difficult for States to provide postage paid envelopes. 

Despite these problems, the majority of States do pay for return mail postage, and several 

other States indicate that they may begin using post-paid envelopes in their next Title XXI 

implementation phase. 

In addition to mail in applications, some States will begin processing CHIP applications 

based on information faxed to them. However, these States also require that the original 

application be sent to them also. According to our respondents, an original signature is 

required to be on file in order to have a complete CHIP application. Currently, no States 

accept Internet-based applications, as questions still remain about the security of 

information sent in this manner. 

Elimination of face-to-face interviews 

Although Federal law does not require either Medicaid or CHIP applicants to undergo an 

interview, some States do require families to have one. Three States, all using Title XXI 

for Medicaid expansion programs, require an interview. For two of these States the 

interview for Title XIX and Title XXI applicants must be in person, while the third State 

allows interviews to take place by telephone as well. Administrators at these States 

indicated that their programs, including the application interviews, were shaped by their 

State legislators’ desire to ensure program integrity. 

Presumptive eligibility 

Four of the 19 States interviewed for this study have presumptive eligibility policies for 

CHIP applicants. These States will pay for medical services provided to children while the 

State determines whether or not the child is eligible for CHIP or Medicaid. In two of the 

States, this “initial” or “temporary” eligibility is determined by insurers seeking to enroll 

States’ Application and Enrollment Processes 16 OEI-05-98-00310 
children in their managed care product. To avoid over-optimistic determinations, one State 

has imposed a 3 percent limit on errors. In the other two States, all children without 

insurance are granted presumptive eligibility while their applications are processed. 

There are no requirements governing “presumptive eligibility” in the CHIP legislation. 

Each State must determine how to handle presumptive eligibility if it chooses to use it. 

According to HCFA, many States have linked the eligibility effective date to the date of 

enrollment in a health plan. States that have elected to expand their Medicaid programs 

under CHIP must comply with specific requirements set forth in Medicaid statute (Title 

XIX). Under Title XIX eligibility is effective with the date of application, or at State 

option, the first day of the month of application. 

Some State application policies may adversely affect when a child’s coverage begins under 

CHIP or Medicaid. Some States return incomplete applications without establishing a 

protective filing date that would ensure coverage effective the date of application, or the 

first day of the month of application. In some States, CHIP eligibility may not become 

effective until 45 days after an application is approved. These practices may mean that 

eligible children are uninsured when they need medical care. A few States have addressed 

this problem by assuring payment to providers who care for children during the CHIP 

application and eligibility determination process. 

There are myriad reasons why States have elected not to use presumptive eligibility in their 

CHIP program. Several States indicate that they want children to have access to a 

consistent source of care. They worry that parents of children determined presumptively 

eligibility will not follow through with a full Medicaid/CHIP determination. One State 

noted that when its Medicaid program used presumptive eligibility for pregnant women, the 

number of presumptively eligible women who followed through to enroll in Medicaid was 

very low. 

Several States indicated that they currently back-date program eligibility to the date of 

application. If a CHIP application is approved, these States will cover medical expenses 

incurred by applicants during the enrollment process. States that back-date coverage prefer 

this process to presumptive eligibility. They contend that use of the application date as the 

first day of CHIP coverage helps ensure that children can get immediate medical care while 

an application is processed. The State promises providers that they will be paid for 

services provided to an applicant child before eligibility is officially determined. 

Several States felt that presumptive eligibility was difficult and expensive to administer, 

and was not a very high priority. Several States said that they decided to streamline the 

regular application process in order to get children covered as quickly as possible. One 

other concern is that a number of States have shaped their CHIP programs to look like 

private insurance coverage, and presumptive eligibility may not fit within this model. One 

such State indicated that they want their program to look like a regular health plan, and do 

States’ Application and Enrollment Processes 17 OEI-05-98-00310 
not want to use presumptive eligibility, which looks like welfare. 

Use of enrollment contractors 

While six States do not use enrollment brokers or other contractors for any part of their 

CHIP enrollment, the other 13 contract for large and small parts of their enrollment 

process. As managed care is becoming the common mode of service delivery, many 

separate CHIP and Medicaid outreach programs use contractors to provide information to 

families choosing a health care plan or medical provider. 

Several States contract with health plans to run the program in various areas of the State. 

Two such States make the health plans responsible for outreach, enrollment and customer 

contact. The health plans must work within the rules outlined by the State plan, but have 

some flexibility to design their own enrollment forms and procedures within those 

boundaries. 

Five States have contracts with enrollment brokers to process CHIP applications and 

determine eligibility for the State’s separate Title XXI programs and the CHIP portion of 

combination plans. In some States, contractors screen children for Medicaid, forward 

potential Medicaid eligible to the State and determine Title XXI eligibility for nonMedicaid eligible children. In at least one State, the nonprofit entity running the health 

program screens all applications for Medicaid eligibility. This organization forwards the 

applications to State Medicaid workers or the private contractor for a final determination 

of eligibility. 

Several States use contractors for parts of the enrollment process. Four States contract out 

their customer service lines, using private groups to answer applicant questions, send out 

applications and in some cases help families fill out applications. Some States use their 

own staff to determine program eligibility but contract for data processing tasks, 

documentation verification, application pre-screening and database maintenance. 

Contractors may also send out insurance cards and information to families and collect 

premiums from them. 

Elimination of some verification requirements 

Title XXI programs are not required to use asset tests in their applications, and most States 

do not. Two States that have separate CHIP programs ask for asset information. Two 

other States, both using Title XXI funds for Medicaid expansions, also have asset tests. 

To limit the amount of documentation families are required to provide, many States use 

electronic or other databases to verify applicants’ responses. Many States indicated that 

they do not want to force families to provide information the State can obtain from third 

party sources. Several States electronically access information on unemployment and 

States’ Application and Enrollment Processes 18 OEI-05-98-00310 
earned income, as well as on social security numbers and immigration status. One State 

routinely contacts the health department for pregnancy verification. Workers in this State 

also contact the local human services department for documentation of welfare income and 

children’s ages. 

Many States allow families to self-certify application information. One State accepts all 

application statements and does not require any documentation other than on alien status. 

This State’s eligibility process includes a check of the Social Security database, State 

unemployment wage files, and unemployment compensation database. The family is only 

contacted if third party information is inconsistent with the application responses. Other 

States are reluctant to accept self-certification because they fear their error rate may 

increase and affect their Federal funding. They also worry about ensuring program 

integrity if they do not verify information. 

Denial rates 

Collecting comparable data on the precise number of CHIP denials is difficult. It is difficult 

to determine the number of applicants who apply and are subsequently denied CHIP 

eligibility. Some States have no information about the number and identity of children 

whose CHIP application was returned because it was incomplete or lacked documentation. 

Several CHIP programs consider the application date to be the date the State receives a 

completed application along with all documentation. 

In several States, technical denials occur at CHIP intake sites. Workers at these intake 

sites only forward completed applications for potentially eligible applicants to the State. 

One CHIP intake site reports an application denial rate in excess of 30 percent, while the 

State reports a CHIP denial rate of less than 5 percent. States with low, or no, CHIP 

application denials may not be the most effective at enrolling children in CHIP. Their 

processes may obscure the true nature of denials. 

Intake sites that collect and process joint CHIP/Medicaid applications may fail to protect an 

applicant’s filing date by returning an incomplete application without establishing a record 

to protect the date of CHIP/Medicaid eligibility. Several States that return incomplete 

applications did not record information about applicants or the date they applied . This 

missing information could adversely affect the date a child becomes eligible for CHIP or 

Medicaid. It also distorts data on the number of CHIP applicants and the data on the 

disposition of each child’s application. Without better controls over applications, 

information about the number of children seeking CHIP coverage is unreliable. Refusing to 

accept applications that are incomplete distorts information on the number and reasons for 

denials. 

A few States do not deny applications with missing information. One State “deactivates” 

cases with missing information after 60 days. Another “dismisses,” rather than denies, 

States’ Application and Enrollment Processes 19 OEI-05-98-00310 
applications with insufficient information or ineligible applicants. These practices may 

distort information about denials. More importantly they may obscure information as to 

the precise reason for denial that might be useful in improving the CHIP program. 

Several States engage in aggressive follow-up with families to get information missing from 

applications. In several States, State employees or contractors help families fill out 

applications. They also help families secure needed documents to establish eligibility. 

Several States accept applications that are not complete and then re-contact families to 

collect needed information or obtain the information through a third party. One State 

indicated that its low denial rate of 3.6 percent was due to active follow-up done while 

incomplete applications are pending. Several States do not require extensive 

documentation. 

Citizenship Dilemmas: Barriers To Enrollment 

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 

(PRWORA) requires that all agencies administering Federal public benefits ensure that 

benefits are provided only to citizens and qualified aliens. In addition to providing benefits 

to citizens and qualified aliens, the law also provides for the emergency treatment of nonqualified aliens who otherwise meet Medicaid eligibility criteria. The Immigration and 

Naturalization Service (INS) has developed guidelines to assist State and local 

governments and their contractors in determining whether an alien qualifies for public 

benefits. 

When applying for Federal public benefits, applicants must declare whether they are 

citizens of the United States2. Any person who is not a citizen is considered to be an alien 

and his or her eligibility for public benefits as a qualified alien must be verified. The 

exception to this rule involves non-qualified aliens seeking emergency medical care. Nonqualified aliens are not required to make a such a declaration in order to get emergency 

medical care coverage. 

States verify citizenship and alien status using a variety of documents and systems. States 

can accept an applicant’s certification that they are a national (citizen) of the United States 

if no information to dispute that claim exists. When a question of citizenship or qualified 

alien status arises, the States must verify that the applicant is a qualified alien. An extensive 

list of primary and secondary evidence to establish citizenship and alien status is prescribed 

2 We have elected to use the term citizen throughout this report. The law requires that an applicant for 

public benefits declare whether he or she is a national of the United States rather than U.S. citizen because national 

of the United States is a term specifically defined as a citizen of the United States, or a noncitizen owing 

permanent allegiance to the United States. Non-qualified (illegal) aliens are not required to make a declaration 

whether they are national of the United States to obtain emergency medical care. 

States’ Application and Enrollment Processes 20 OEI-05-98-00310 
by INS in law. In addition to documents provided by applicants, agencies administering 

public benefits must verify alien status using INS’s Systematic Alien Verification for 

Entitlements (SAVE) system. Currently, no system exists for verifying citizenship. 

The “Illegal alien” dilemma 

Illegal aliens have concerns about revealing information that might affect their applications 

for citizenship or result in their deportation. State employees and individuals helping 

families fill out applications told us that parents residing in the United States illegally were 

reluctant to complete a CHIP application for their children born in the United States. 

Children of illegal aliens born in the United States are citizens and eligible for CHIP and 

other public benefits. The siblings of these eligible children may be illegal aliens and 

ineligible for CHIP, Medicaid and other public benefit programs. 

Illegal aliens fear that the information they provide on CHIP applications about themselves 

and their children will be shared with INS. They fear that INS will use the information to 

locate and deport them. Title XXI requires that the age, social security number and 

citizenship of children seeking enrollment in the CHIP program be determined. 

In a September 10, 1998 letter to State Health Officials, HCFA clarified that title XXI does 

not, and cannot require applicants (parents, guardians and others) to disclose their social 

security number or citizen status when completing a CHIP application. States that have 

elected to expand their Medicaid program under CHIP can only require the SSN of the 

children applying for CHIP enrollment. Information about the citizenship and SSN of the 

person applying for CHIP benefits on behalf of a child is not required by Federal law. 

Moreover, HCFA policy prohibits States from taking into account the parents citizenship 

when determining a child’s CHIP eligibility. 

To determine Medicaid eligibility, all States solicit some information about a child’s parents 

on their application for benefits. States that have elected to use Title XXI (CHIP) funds to 

expand their Title XIX (Medicaid) programs also solicit information about parents. The 

CHIP legislation requires States to screen for Medicaid eligibility every child applying for 

CHIP benefits. Some States routinely screen all household/family members (parents and 

children) for Medicaid eligibility. According to outstation workers, aliens fear that States 

will share CHIP application information with INS during the screening and verification 

processes many States conduct to determine eligibility for other public benefit programs. 

The process for verifying the qualified alien status of applicants for Medicaid requires that 

States input certain information about alien applicants into SAVE or some approved 

alternative system.3 States that operate CHIP programs independent of their Medicaid 

3 Most States use SAVE for their Medicaid program. The current law does not require States to use the 

system. A proposed rule, if enacted, would make use of the SAVE system mandatory for all agencies providing 

States’ Application and Enrollment Processes 21 OEI-05-98-00310 
program are required to use interim guidelines provided by the INS. These guidelines do 

not require the use of the SAVE system. The SAVE response provides information 

relevant to benefit eligibility. It is INS’s position that the actual determination as to 

whether an applicant meets a program’s eligibility requirements is left to the State benefit 

granting agency. 

Some States have adopted policies and practices designed to protect disclosure of 

information concerning illegal aliens. One State informs applicants that they do not need to 

disclose their social security number (SSN). This State assigns a fictitious SSN to 

applicants who do not have or refuse to provide an SSN. Other States would like to use 

private, not-for-profit agencies to execute CHIP applications on behalf of children whose 

parents are reluctant to apply because they fear immigration repercussions. Several States 

report that despite changes in the law, new application and verification requirements and 

elimination of the face-to-face interview, the number of CHIP applications from eligible 

immigrants is lower than expected especially among Spanish-speaking individuals. 

Illegal aliens fear personal information on CHIP applications will be entered into the SAVE 

system and used by INS to enforce immigration laws including removal from the United 

States. This fear is not unfounded. The INS may use SAVE information for the purpose 

of enforcing any civil and criminal violations of immigration law. By statute the INS is 

prohibited from using SAVE for administrative (non-criminal) enforcement. In December 

1997, HCFA notified the States that benefit information should not be shared with INS or 

the State Department, except in cases involving fraud and abuse. 

Conflicting HCFA and INS positions leave States, intake workers and applicants uncertain 

as to whether information on CHIP applications will or will not be used to enforce 

immigration laws. Despite HCFA’s assurances to the contrary, States and intake workers 

report that noncitizens believe information collected on CHIP and Medicaid applications 

might be used to enforce immigration laws at some time in the future. The HCFA’s 

position is that Medicaid agencies are not required to report illegal aliens to the INS. 

However, a State Medicaid or CHIP agency may, if it chooses, report illegal aliens to INS. 

Statutes acknowledge that no law can prohibit a State (including Medicaid State Agencies) 

or locality from reporting Illegal aliens to INS. 

Illegal aliens are reluctant to apply for CHIP for their eligible children. They fear that INS 

may use the information to locate and possibly deport them. Though statutes appear to 

limit INS's use of SAVE information, our respondents indicate that illegal aliens fear the 

information will find its way to the INS either through the SAVE system or through direct 

referral to INS by a State agency. 

Respondents told us that until INS and HCFA issue a joint statement that CHIP and 

Federal public benefits within 2 years of the rules final enactment. 

States’ Application and Enrollment Processes 22 OEI-05-98-00310
Medicaid applications will not be used to enforce immigration laws, parents and guardians 

in the United States illegally will be reluctant to enroll their eligible children in CHIP. The 

absence of a clear and uniform policy statement from HCFA, the States and INS as to their 

use of application information deters people from enrolling in the CHIP program. 

Immigrant parents fear that the information they provide will help the INS identify them or 

one of their children or other family member as an illegal alien. 

The “public charge” dilemma 

Eligible aliens are reluctant to complete a CHIP application because they fear, or have 

misunderstandings related to, public charge requirements under immigration laws. Many 

aliens fear that the use of any government services (including Medicaid and CHIP) would 

threaten their request for permanent residence status. State CHIP program administrators 

and individuals working with families of CHIP eligible children told us that qualified aliens 

fear that their children’s receipt of CHIP or Medicaid will adversely affect application for 

citizenship. 

Qualified aliens fear that they will be denied citizenship if INS determines that the public 

charge provision of the Title V, Illegal Immigration Reform and Immigrant Responsibility 

Act of 1996 (Public Law 104-208) has been violated. They also fear that they will have to 

pay back the entire cost of their children’s health insurance if they ever apply for 

citizenship. 

States and intake workers reported that noncitizen parents felt the law and regulations did 

not explicitly state that the CHIP application they executed on behalf of their children did 

not fall under public charge provisions of the Immigration Act. The INS, which has 

jurisdiction over these matters, has not issued an official statement or policy guidance on 

public charge determinations. When INS does issue policy guidance on public charge 

determinations, HCFA plans to notify the States as to how the INS policy affects CHIP or 

Medicaid recipients. 

Multiple Program Rules 

States expressed concern about the Federal push for States to develop a single application 

for Medicaid, CHIP and other public benefit programs such as food stamps and the WIC 

program. States find that creation of a single application for multiple public benefit 

programs is impeded by the different requirements each program has in place. 

Conflicting application and verification requirements pose a processing problem for States. 

Federal Medicaid and CHIP statutes allow States considerable latitude in how they 

implement these programs. The HCFA’s August 10, 1998 letter to State health officials, 

advises States that they must verify the alien status for Medicaid and CHIP applicants. 

States’ Application and Enrollment Processes 23 OEI-05-98-00310 
Beyond that requirement, States can decide what information to collect and can choose 

what and how they will verify information. 

Some States allow families to apply for CHIP at local Medicaid and social services offices. 

Intake workers, familiar with Medicaid and other public benefit programs, may be resistant 

to changes in application processes. Some States expressed concern that front-line 

workers continue to require CHIP applicants to use the old, more burdensome application 

processes. 

State efforts to streamline the application and enrollment processes for public benefit 

programs, including Medicaid and CHIP, are hindered by different Federal program 

requirements. While States have considerable latitude to decide what information will be 

collected and what information on applications will be verified, they are concerned that 

different definitions and standards for verification used by different Federal public benefit 

programs will affect their error rate. 

States mentioned the following Federal requirements as causing problems: 

< Income verification. The HCFA told the States that they have considerable 

latitude to decide if they will verify income of applicants for CHIP and Medicaid. 

Section 1320b-7 of 42 U.S.C. appears to require all States to have in effect and 

use an income and eligibility verification system for Medicaid, food stamps and 

other public benefits. To use IEVS, States must obtain the social security numbers 

of the children’s parents and other adult members whose income will be considered 

in determining eligibility. It is HCFA’s position that the SSN of parents and other 

adult household/family members is not required for CHIP. 

< Household/family composition. States told us that conflicting rules for 

determining household/family composition impede the development of a single 

application for CHIP, Medicaid and other public benefit programs. In one State, 

the family unit for CHIP includes every person living in the household/family. 

Medicaid only counts persons living in the household/family that have a legal 

relationship. 

< Household/family income. Some State CHIP programs count the incomes of 

all persons living in the household/family. Under Medicaid rules, States may only 

consider the income of a parent or a spouse living in the household/family. 

< Child support. States that have elected to establish a separate CHIP program 

are unsure as to circumstances, if any, that would require them to make a referral 

to Child Support Enforcement. Some public benefit programs including Medicaid 

require States to pursue the establishment of paternity and child support. Failure 

to pursue child support can result in a denial of benefits. 

States’ Application and Enrollment Processes 24 OEI-05-98-00310 
< Disclosure of Information. Each Federal public benefit program has its own 

rules concerning disclosure of information. Title XIX permits disclosure only for 

Title XIX purposes. The Food Stamp program requires that the applicant know to 

whom information is disclosed and for what purpose. 

States expressed interest in establishing an interagency workgroup to address these 

conflicting Federal policies. The purpose of the workgroup would be to examine the 

different program requirements of Federal public benefit programs. The workgroup would, 

to the extent possible, recommend changes in agency policies that would reduce or 

eliminate the variations cited above and other conflicting requirements. 

States are apprehensive about developing joint applications and uniform verification 

procedures when Federal laws governing the public benefit programs they administer 

appear to conflict. 

States’ Application and Enrollment Processes 25 OEI-05-98-00310 
RECOMMENDATIONS 

Readability Of Application Forms 

We recommend that HCFA work with States to improve the readability of CHIP 

applications. The high reading level of some CHIP applications can dissuade prospective 

applicants from applying. Language complexity may lead other applicants to incorrectly fill 

out forms, which may have an impact on whether applications for health care coverage are 

accepted or denied. Reducing language complexity and reading level on CHIP applications 

can improve access to available services. 

Simplification Efforts 

We recommend that HCFA continue to encourage States to simplify their application and

enrollment processes for CHIP and Medicaid. State efforts to simplify application and

enrollment processes are showing encouraging results in several States, however, a

successful practice in one State may have different results in another. It is too early in the

CHIP program to determine the effectiveness of State changes to application and

enrollment processes.

We encourage HCFA to continue to support State efforts to:

< Reduce application length;

< Use joint Medicaid/CHIP applications;

< Use multi-program applications;

< Print applications in Spanish or other languages;

< Distribute applications at multiple sites;

< Utilize toll-free telephone lines to provide information;

< Provide assistance with the application process;

< Increase the use of outstation and application collection sites;

< Utilize mail-in applications and post-paid envelopes;

< Eliminate face-to-face interviews.

We also encourage HCFA to continue helping States investigate the following practices:

< Contracting with enrollment brokers;

< Eliminating some verification requirements.

Under Medicaid, eligibility is effective with the date of application or, at State option, the

States’ Application and Enrollment Processes 26 OEI-05-98-00310 
first day of the month of application. There is no requirement in the CHIP legislation that 

governs the effective date of CHIP eligibility. States can decide what the effective date of 

coverage will be under CHIP. We recommend that HCFA encourage States with separate 

CHIP programs to adopt CHIP eligibility policies that parallel their Medicaid policies. We 

also recommend that HCFA encourage States to either utilize presumptive eligibility or 

back-date coverage for eligible children from the date of application. 

Citizenship Issues 

We recommend that HCFA work with INS to encourage INS’s development of clear 

guidance and policy statements on how applications for CHIP and Medicaid will impact 

noncitizens. Qualified aliens, concerned about “public charge” issues, should know 

whether using the CHIP benefit will affect their citizenship. Illegal aliens should know if 

the information they provide on CHIP applications for their citizen children will be used to 

enforce immigration laws. 

We recommend that HCFA work with the INS to develop a joint policy as to whether INS 

will use SAVE system information about CHIP applicant children to find and prosecute 

parents and siblings residing illegally in the United States. Illegal aliens should know if the 

information they provide on CHIP applications for their citizen children will be used to 

enforce immigration laws. While HCFA and INS have indicated that information from the 

SAVE system will not be used to find and prosecute illegal residents, the American public 

needs a clear and public joint, written statement on this issue. 

Uniformity Of Program Requirements 

We recognize that program rules often differ due the exigencies of running each program. 

We realize that amending program rules can be a difficult process. Several groups have 

been formed to look into the problem of conflicting program rules, not all of which have 

been successful. Despite this, there may be places of agreement between programs which 

can allow rule changes to bring programs into closer alignment. 

We recommend that an interagency task force be formed to address conflicting public 

benefit application requirements. We recommend that this interagency workgroup develop 

uniform policies for verifying income, using the Income Eligibility Verification System, 

determining household/family composition, defining countable income, counting child 

support and disclosing information. Where necessary, agencies should seek statutory 

change to permit uniformity across programs. Taking first steps on this project will be a 

useful endeavor and may particularly benefit States wishing to use multi-program 

applications for their child health insurance and other benefit programs. 

States’ Application and Enrollment Processes 27 OEI-05-98-00310 
AGENCY COMMENTS 

We would like to thank HCFA, the Health Resources and Services Administration (HRSA) and 

the Assistant Secretary for Management and Budget (ASMB) for commenting on the draft of this 

report. Based on comments we received from HCFA and ASMB some wording changes and 

clarifications were made to the report. 

The HCFA concurred with our findings and recommendations. They highlighted their ongoing 

efforts in the areas we discussed in the report. The HRSA found the draft report to be acceptable 

and had no comments. The full text of HCFA’s and ASMB’s comments on the draft report, along 

with HRSA’s response, can be found in Appendices A, B and C. 

States’ Application and Enrollment Processes 28 OEI-05-98-00310 
APPENDIX A 

Health Care Financing Administration 

Comments on the Draft Report

DATE: APR 2 7 1999 

TO: June Gibbs Brown 

Inspector General 

FROM: Nancy-Ann Min DeParle 

Administrator 

SUBJECT: Office of Inspector General (OIG) Draft Report: “The Children's Health Insurance 

Program: State Application and Enrollment Process: An Early Report from the 

Front Lines,” (OEI-05-98-003 10) 

We appreciate OIG's efforts to help the Health Care Financing Administration (HCFA) identify 

promising practices, barriers, and issues related to the application and enrollment procedures of 

the Children's Health Insurance Program (CHIP). We support the recommendations in this draft 

report, especially those that will make the application process easier and more user friendly for 

potential beneficiaries. 

HCFA has been providing technical assistance to states in order to simplify enrollment 

procedures. We are encouraged to see in the findings that States are following this advice and 

simplifying their application and enrollment processes. In a letter to State Health Officials issued 

on January 23, 1998, we described options for successful outreach and enrollment and provided 

examples of such activities, such as out-stationing sites for filing applications, use of mail-in 

applications, joint applications for both CHIP and Medicaid, and presumptive eligibility. In a 

second letter issued on September 10, 1998, we highlighted the flexibility States have to simplify 

the application and enrollment processes. In that same letter, we clarified two eligibility-related 

issues that were seen as barriers to enrollment. States were advised that a child's eligibility for 

Medicaid or CHIP is not contingent on disclosure of parents' Social Security Number (or lack 

thereof) or on information about non-applicant parents' immigration status. 

Additionally, a multitude of other initiatives are underway to promote successful implementation 

of CHIP. The following describes some examples which illustrate Federal support for State 

outreach programs. 

‚ Continuing the Outreach Campaign. The national campaign initiative between the 

National Governor's Association and the White House which includes a national toll-free 

States’ Application and Enrollment Processes 29 OEI-05-98-00310 
APPENDIX A 

telephone number (1-877-KIDS-NOW) to provide information to potential enrollees and a 

series of radio ads in both English and Spanish. 

‚ Providing Technical Assistance. HCFA and Health Resources and Services 

Administration recently completed a series of Technical Advisory Panels (TAPs) involving 

twenty States. The purpose of these sessions was to: (1) provide a forum for exchange of 

experiences with the development and implementation of outreach strategies, (2) establish 

partnerships for outreach between States and the Federal government and (3) develop 

strategies for involving the private and voluntary agencies in outreach programs. 

‚ Publishing Useful Information. Federal support for State outreach is the lead being taken 

by HCFA in developing a Technical Assistance Guide that describes for State Medicaid 

agencies and partners the latest information on “how to” provide appropriate information 

to consumers in an easy to understand format. This guide will address issues related to 

cultural sensitivity and will include information on methods of material distribution and use 

of the media, among other topics, and will be available in the Fall of 1999. 

Our detailed comments on the report recommendations follow.

OIG Recommendation #1

HCFA should work with States to improve the readability of CHIP enrollment applications.

HCFA Response

We concur. By reducing language complexity and reading level on CHIP applications, States can

improve access to available services. HCFA will continue to bring this concern to the attention of

States and will offer technical assistance to States on improving the readability of application

forms.

OIG Recommendation #2

HCFA should continue to encourage States to simplify their application and enrollment processes

for CHIP and Medicaid.

HCFA Response

We concur. We will continue to encourage States to simplify their application processes, and

promote successful examples of simplification procedures and action States have already taken. 

We have released a model application form that States can use to see how easy it is to have a

simple application. We have also released a guide book titled, “Working Families” that discusses

the importance of a simple application.

States’ Application and Enrollment Processes 30 OEI-05-98-00310 
APPENDIX A 

OIG Recommendation #3

HCFA should encourage States with separate CHIP eligibility policies that parallel their Medicaid

policies. We also recommend that HCFA encourage States to presume eligibility of all children

effective with the date of application.

HCFA Response

We concur. States should be encouraged to adopt CHIP eligibility policies that parallel their

Medicaid policies which make eligibility effective either with the date of application or the first

day of the month of application. Since there is no requirement under Title XXI for retroactive

eligibility, as there is under Medicaid, States have flexibility. It should be noted that many States

have linked the eligibility effective date to the date of enrollment in a health plan.

OIG Recommendation #4

HCFA should work with Immigration and Naturalization Service (INS) to develop clear guidance

and policy statements on how applications for CHIP and Medicaid will impact noncitizens.

HCFA Response

We concur. We have taken the initiative to work with INS to develop and release the much

needed policy guidance regarding the “public charge” issue. However, the recommendation

seems to imply that HCFA is responsible for public charge policy. As was discussed in the body

of the report, it is the INS of the Department of Justice which has jurisdiction over public charge

determinations and policy guidance. INS is, however, consulting with the Department of Health

and Human Services about its views on this issue. Once such policy guidance is issued by the

INS, HCFA plans to notify the States as to how the receipt of Medicaid or CHIP benefits relates

to the determination of public charge.

OIG Recommendation #5

HCFA should work with the INS to develop a joint policy as to whether INS will use the

Systematic Alien Verification for Entitlements (SAVE) system information about CHIP applicant

children to find and prosecute parents and siblings residing illegally in the United States.

HCFA Response

We will consult with the INS on this, but it is our understanding that their policy already prohibits

the use of SAVE for administrative (non-criminal) immigration enforcement purposes, i.e., to

deport people. The proposed INS rules pertaining to Verification of Eligibility for Public

Benefits, published on August 4, 1998, in the Federal Register, contain an entire subpart (Subpart

C) which addresses the SAVE system. Specifically, Section 104.51 states that the INS cannot use 

the information in the SAVE system for administrative (non-criminal) immigration enforcement 

purposes. Such information may, however, be used for the purpose of enforcing any provision of 

criminal law. Additionally, we have clarified through a representative of the INS that receiving a 

States’ Application and Enrollment Processes 31 OEI-05-98-00310 
APPENDIX A 

“no match” through the SAVE system does not necessarily imply that an alien is in an illegal

status.

OIG Recommendation #6

We recommend formation of an interagency task force to address conflicting public benefit

application requirements. We recommend that this interagency workgroup develop uniform

policies for verifying income, using the Income Eligibility Verification System, determining

household/family composition, defining countable income, counting child support, and disclosing

information.

HCFA Response

We concur. We support the establishment of an interagency task force to address conflicting

public benefit application requirements. Greater uniformity in various program rules can be

beneficial to the administration of the programs as well as to beneficiaries. Complete uniformity

across all programs, however, may not be possible due to the differences in statutory requirements

of such programs as Medicaid, Food Stamps, and SSI.

Technical Comments

Pg. 1, paragraph 4: In the last sentence add at the end “and have more flexibility on the benefit

package.”

Pg. 2, first line: After “. . . the law prohibits States,” please add “from receiving enhanced match if 

they tighten . . .” Delete “. . . from tightening the . . .” 

Pg. 6, paragraph 2: It would be better to have one paragraph devoted to the advantages and 

another to the disadvantages. The first sentence might be stronger if it were reworded: “Using a 

joint Medicaid/CHIP application can simplify the application process for families because they 

only have to complete one application and the families do not have to determine which program 

their children may be eligible for.” The second sentence of this paragraph should be rewritten as 

follows: “Joint applications ensure the enrollment of CHIP applicants in Medicaid if they qualify 

for that program.” 

Pg. 7, paragraph 7: Please verify that the number 71 is correct? It seems very high. 

Pg. 12, paragraph 3: In the third sentence, substitute “statute” for “legislation.” 

Pg. 12, paragraph 5: The State reports that the number of presumptively eligible women who are 

determined eligible is very low. This seems at odds with other reports that the vast majority of 

women are found eligible. 

States’ Application and Enrollment Processes 32 OEI-05-98-00310 
APPENDIX A 

Pg. 12, last paragraph: The last sentence does not appear to be correct. It says that States prefer 

backdating the program eligibility to the date of application because it ensures that eligible 

children get immediate medical care. If the children are not eligible until determination, this 

would not help them get care in the short run. They would still have to pay out of pocket for any 

services initially received. 

Pg. 16, second paragraph: Please add at the beginning of the 4th sentence: “In a letter to State 

Health Officials on September 10, 1998, HCFA clarified that ...” 

Pg. 17, third paragraph: The conflicting positions of HCFA and INS are never specified. It only 

mentions HCFA policies. 

Pg. 19, first full paragraph: It would make sense if the work group were interagency. 

Simplification Efforts, as continued at top of page 21: The last sentence should be clarified. Does 

the report mean that HCFA should encourage States to adopt “presumptive eligibility” in separate 

State CHIP programs? Does the report mean that States should presume all children who apply 

are eligible until a final CHIP determination? Does the report mean that anyone taking the CHIP 

applications should determine children presumptively eligible? 

States’ Application and Enrollment Processes 33 OEI-05-98-00310 
APPENDIX B 

Health Resources and Services Administration 

Comments on the Draft Report

TO: Inspector General 

FROM: Deputy Administrator 

SUBJECT: OIG Draft Report, "THE CHILDREN'S HEATH INSURANCE PROGRAM -

State Application and Enrollment Processes: An Early Report from the Front 

Lines," Issued February 2, 1999 

We have reviewed the subject report and find it to be acceptable. HRSA has no comments on this 

report. 

States’ Application and Enrollment Processes 34 OEI-05-98-00310 
APPENDIX C 

Assistant Secretary for Management and Budget

Comments on the Draft Report

MEMORANDUM TO: June Gibbs Brown 

Inspector General 

FROM: John J. Callahan 

Assistant Secretary for Management and Budget 

SUBJECT: Comments on OIG Draft Report: “The Children's Health 

Insurance Program - State Application and Enrollment 

Processes: An Early Report from the Front Lines” 

Thank you for the opportunity to review the draft report entitled “The Children's Health Insurance 

Program (CHIP) - State Application and Enrollment Processes: An Early Report from the Front 

Lines” (OEI-05-98-00310). We would like to offer the following comments: 

C The use of simplified application forms has been cited by the Department as a form of 

outreach. Since the Department has no authority to require the states to undertake any of 

the activities described in the report, it should be clearly stated that any state activity 

related to outreach is done at state option. 

C On page 1, Background section -The report cites the number of uninsured children, but 

does not cite a source. Given that there is more than one way to count numbers of 

uninsured children and given that there is more than one set of published numbers, it may 

be useful to cite a source or use a range of numbers rather than a discrete number. 

C On page 13, Use of enrollment contractors - The language in the first paragraph which 

describes the use of enrollment contractors in assisting eligible families in choosing a 

health care plan, may not be consistent with department policy. Policies differ depending 

on if the state is implementing a CHIP Medicaid expansion or if the state is developing a 

separate state plan. In Medicaid, while enrollment contractors may assist in application 

completion, I understand that they are prohibited from determining eligibility or directing 

beneficiaries to enroll in health plans. 

In separate CHIP plans, assisting enrollment in health plans may be acceptable if these 

contractors are truly independent from the health plans and if there is no financial 

incentive. While this is implicitly discussed, we believe a more explicit explanation would 

be useful. 

States’ Application and Enrollment Processes 35 OEI-05-98-00310