United States General Accounting Office

GAO Report to the Honorable 

John McCain, U.S. Senate

March 1998 MEDICAID

Demographics of

Nonenrolled Children

Suggest State Outreach

Strategies

GAO/HEHS-98-93

GAO United States

General Accounting Office

Washington, D.C. 20548

Health, Education, and

Human Services Division

B-278558 

March 20, 1998

The Honorable John McCain

United States Senate

Dear Senator McCain:

Health insurance has become increasingly important as a means for

providing children access to adequate health care, yet in 1996, 10.6 million

children were uninsured. The Congress recently demonstrated its interest

in insuring more children by committing more than $20 billion over a

5-year period to fund state expansions of children’s health

insurance—either through the Medicaid program or through insurance

programs developed by states. However, as we have reported in the past,

many uninsured children who are eligible for Medicaid are not enrolled.1

Concerned about this failure to enroll children in Medicaid, you asked us

to

• examine the demographic and socioeconomic characteristics of children

who qualify for Medicaid, and identify groups in which uninsured children

are concentrated and to whom outreach efforts might be targeted;

• determine the reasons these children are not enrolled in Medicaid; and

• identify strategies that states and communities are using to increase

enrollment.

To examine the characteristics of families of Medicaid-eligible uninsured

children, we analyzed data from the Bureau of the Census’ March 1997

Current Population Survey (CPS). To develop a demographic profile of

uninsured Medicaid-eligible children, we linked information on children’s

health insurance status with their families’ characteristics and compared

them with children similar in age and family income who are enrolled in

Medicaid or who have employment-based insurance. In this analysis, we

only considered children who met the federal age and income standards

for mandated eligibility. We did not include children who could be eligible

because of individual state expansions or children over age 12 who could

be eligible if their family income was low enough to receive cash

assistance in their state.

1

Health Insurance for Children: Private Insurance Coverage Continues to Deteriorate

(GAO/HEHS-96-129, June 17, 1996); Health Insurance for Children: Many Remain Uninsured Despite

Medicaid Expansion (GAO/HEHS-95-175, July 19, 1995).

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To determine the reasons eligible children are not enrolled in Medicaid

and identify strategies that could assist in getting such children enrolled,

we interviewed state officials, beneficiary advocates, and provider

representatives in Arkansas and Massachusetts; state officials in Georgia;

and other experts. We also reviewed the outreach materials used by these

states and by Wisconsin. Arkansas, Georgia, and Massachusetts were

selected from among several states that were identified by experts as

having innovative outreach programs. Additionally, Wisconsin was

identified as being further along in its approach to welfare reform and

Medicaid outreach and eligibility determination. State outreach programs

are designed to reach all Medicaid eligibles, and the programs we

reviewed target all eligible children, both mandated and optional. For

more information on our scope and methodology, see appendix I. Our

work was conducted between July 1997 and February 1998, in accordance

with generally accepted government auditing standards.

Results in Brief The demographic and socioeconomic characteristics of uninsured

Medicaid-eligible children suggest that outreach strategies could be

targeted to specific groups. In 1996, 3.4 million Medicaid-eligible

children—23 percent of those eligible under the federal mandate—were

uninsured. The majority were children of working poor or near poor, and

their parents were often employed by small firms and were themselves

uninsured. Uninsured children who are eligible for Medicaid are more

likely to be in working families, Hispanic, and either U.S.-born to

foreign-born parents or foreign-born. This suggests that state outreach

may effectively target working families and qualified immigrants. States in

the West have higher numbers and percentages of Hispanics and

immigrants among their Medicaid-eligible uninsured children, suggesting

that these groups could also be targeted. Because nearly three-quarters of

uninsured Medicaid-eligible children live in the West and the South, states

in these regions may already face greater challenges in enrolling eligible

children than other states.

State officials, beneficiary advocates, and health care providers whom we

contacted cited several reasons that families do not enroll their children in

Medicaid. Lower income working families may not realize that their

children qualify for Medicaid, or they may think their children do not need

coverage if they are not currently sick. Under welfare reform, the

delinking of Medicaid and cash assistance may cause some confusion for

families, although in a recent report, we found that states were making

efforts to retain a single application and eligibility determination process

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B-278558 

to avoid this problem. In addition, many low-income families believe that

Medicaid carries the same negative image of dependency and inability to

provide for their family that they attach to welfare. Immigrant families,

many of whom are Hispanic, face additional barriers, including language

and cultural separateness, fear of dealing with the government, and

changing eligibility rules. Finally, the enrollment process for Medicaid can

involve long forms and extensive documentation, which are intended to

ensure program integrity but often are a major deterrent to enrollment.

Recognizing these impediments, some states have undertaken education

and outreach initiatives and have tried to change the image of the program

and simplify enrollment to acquire only information deemed essential. For

example, Arkansas and Massachusetts recently initiated major outreach

efforts to publicize their expansions of coverage for children and to reach

families who are unaware of their children’s eligibility. These efforts

include mass media campaigns and coordination of effort with community

organizations and provider groups. Part of their campaign is to inform the

public that Medicaid is available for children in working families. Some

states have made their application and enrollment process more

accessible for working families, using mail-in applications or enrollment at

sites chosen for their convenience. In Georgia, for example, the state has

over 140 outreach workers located at nontraditional sites, such as

supermarkets, who often work evening and weekend hours. To minimize

its identification with welfare and other assistance programs, several

states have changed the name of their Medicaid program. To facilitate

enrollment of Hispanics, many states provide Spanish-language

applications and some are working with community groups. Some states

have also simplified enrollment procedures by shortening the enrollment

form and reducing the documentation requirements. Of states whose

outreach programs we reviewed, officials and advocates emphasized the

importance of consensus and support from a broad spectrum of political

and community leaders in gaining visibility and resources for outreach.

Background Studies have shown that insured children are more likely than uninsured

children to get preventive and primary health care.2

 Insured children are

also more likely to have a relationship with a primary care physician and

to receive required preventive services, such as well-child checkups. In

contrast, lack of insurance can inhibit parents from trying to get health

care for their children and can lead providers to offer less intensive

2

Health Insurance: Coverage Leads to Increased Health Care Access for Children (GAO/HEHS-98-14,

Nov. 24, 1997).

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services when families seek care. Several studies have found that

low-income and uninsured children are more likely to be hospitalized for

conditions that could have been managed with appropriate outpatient

care.3

Most insured U.S. children under age 18 have health coverage through

their parents’ employment—62 percent in 1996. Most other children with

insurance have publicly funded coverage, usually the Medicaid program.

Medicaid—a jointly funded federal-state entitlement program that

provides health coverage for both children and adults—is administered

through 56 separate programs, including the 50 states, the District of

Columbia, Puerto Rico, and the U.S. territories. Historically, children and

their parents were automatically covered if they received benefits under

the Aid to Families With Dependent Children (AFDC) program. Children

and adults may also be eligible for Medicaid if they are disabled and have

low incomes or, at state discretion, if their medical expenses are

extremely high relative to family income.

Before 1989, coverage expansions for pregnant women and children based

on family income and age were optional for states, although many states

had expanded coverage. Starting in July 1989, states were required to

cover pregnant women and infants (defined as children under 1 year of

age) with family incomes at or below 75 percent of the federal poverty

level. Two subsequent federal laws further expanded mandated eligibility

for children. By July 1991, states were required to cover (1) infants and

children up to 6 years old with family income at or below 133 percent of

the federal poverty level and (2) children 6 years old and older born after

September 30, 1983, with family income at or below 100 percent of the

federal poverty level.4

 Since 1989, states have also had the option of

covering infants with family income between 133 percent and 185 percent

of the poverty level. States may expand Medicaid eligibility for children by

phasing in coverage of children up to 19 years old more quickly than

required, by increasing eligibility income levels, or both. The demographic

analysis in this report, however, focuses on the group of children for

whom coverage is mandated.

3

G. Pappas and others, “Potentially Avoidable Hospitalizations: Inequities in Rates Between U.S.

Socioeconomic Groups,” American Journal of Public Health, Vol. 87, No. 5 (1997), pp. 811-22; Andrew

Bindman and others, “Preventable Hospitalizations and Access to Health Care,” Journal of the

American Medical Association, Vol. 274, No. 4 (1995), pp. 305-11; and Carmen Casanova and Barbara

Starfield, “Hospitalizations of Children and Access to Primary Care: A Cross-National Comparison,”

International Journal of Health Services, Vol. 25, No. 2 (1995), pp. 283-94.

4

States have the option of dropping the resource (asset) eligibility requirement for these expansion

populations. Forty states have discontinued using asset tests for some or all children.

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B-278558 

The Personal Responsibility and Work Opportunity Reconciliation Act of

1996 (P.L 104-193), also known as the Welfare Reform Act, substantially

altered AFDC and Supplemental Security Income (SSI) but made relatively

few changes to the Medicaid program itself. The law replaced AFDC with a

block grant that allowed states to set different income and resource

(asset) eligibility standards for the new program—Temporary Assistance

for Needy Families (TANF)—than for Medicaid. To ensure continued health

coverage for low-income families, the law generally set Medicaid’s

eligibility standards at AFDC levels in effect July 16, 1996, thereby ensuring

that families who were eligible for Medicaid before welfare reform

continued to qualify, regardless of their eligibility for states’ cash

assistance programs.5

 The law tightened the criteria for children to qualify

for disability assistance through SSI, thus tightening eligibility for

Medicaid.6

 In addition, the law restricted aliens’ access to benefit

programs, including SSI, and Medicaid benefits that were conditional on

receipt of SSI. State and local governments were given some flexibility in

designing policies that governed aliens’ eligibility for TANF, Medicaid, and

social services. In a recently released report, we studied the Welfare

Reform Act and its impact on Medicaid and found that in the states we

visited, most chose to continue to provide Medicaid coverage to previously

covered groups.7

The Balanced Budget Act of 1997 (P.L. 105-33) restored SSI eligibility and

the derivative Medicaid benefits to all aliens receiving SSI at the time

welfare reform was enacted and to all aliens legally residing in the United

States on the date of enactment who become disabled in the future. At the

same time, states continued to have flexibility in implementing certain

benefits policies for aliens. Current law allows states the option of

providing Medicaid coverage to aliens who were legal permanent residents

in the country before August 23, 1996. States also have the option of

covering legal residents who arrived after August 22, 1996, once they have

resided in the United States for 5 years. Illegal aliens are eligible only for

emergency services under Medicaid. (See table 1.)

5

The law allows states to roll back their income eligibility levels to those in effect May 1, 1988.

Approval from the Health Care Financing Administration (HCFA) is required to make such a change.

6

These children might still qualify for Medicaid under alternative eligibility categories, and states are

required to do redeterminations.

7

Medicaid: Early Implications of Welfare Reform for Beneficiaries and States (GAO/HEHS-98-62,

Feb. 24, 1998).

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Table 1: Summary of Medicaid

Eligibility for Aliens Population Policy

Qualified aliens arriving before August 23, 1996

Legal permanent residents State option

Asylees, refugees Eligible for first 7 years of residency; state option afterward

Qualified aliens arriving after August 22, 1996

Legal permanent residents Barred for first 5 years of residency; state option afterward

Asylees, refugees Eligible for first 7 years of residency; state option afterward

Unqualified aliens

Illegal aliens Emergency services only

PRUCOL aliensa Emergency services only

aPRUCOL (persons residing under color of law) is an umbrella term used for aliens who are

legally residing in the United States but who do not fit in other alien categories.

The Balanced Budget Act also made two changes that directly affect

children’s coverage in the Medicaid program. It gives states the option of

providing 12 months of continuous eligibility to children without a

redetermination of eligibility, thereby avoiding the problem of children

frequently moving on and off Medicaid as their parents’ circumstances

change. The act also allows states to extend Medicaid coverage to children

on the basis of “presumptive eligibility” until a formal determination is

made. Under this provision, certain qualified providers can make an initial

determination of eligibility, based on income, that an individual is eligible.

The individual is then required to apply formally for the program by the

last day of the month following the month in which the determination of

presumptive eligibility was made.

Finally, the Balanced Budget Act created the Children’s Health Insurance

Program (CHIP), a grant program for uninsured children, through which

$20.3 billion in new federal funds will be made available to states over the

next 5 years. CHIP has a number of implications for Medicaid. If a state

chooses to offer coverage through a separate program, the state must

coordinate activities with the Medicaid program to ensure that

Medicaid-eligible children are enrolled in Medicaid.8

 The Congressional

Budget Office estimated that the “outreach effect” of CHIP will result in an

additional $2.4 billion in Medicaid spending over the same 5 years due to

increased enrollment of 460,000 Medicaid-eligible children each year.

States may also use the grant funds to expand coverage under their state

8

States will not receive any federal payments for CHIP if they adopt income or resource standards or

methodologies for determining a child’s eligibility for Medicaid that are more restrictive than those in

effect on June 1, 1997.

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Medicaid programs to reach additional low-income children, increasing

the number of children potentially eligible for Medicaid.

Medicaid-Eligible

Children Who Are

Uninsured Have

Characteristics That

Can Be Used to Target

Outreach Efforts

Uninsured Medicaid-eligible children differ somewhat from those

currently enrolled in Medicaid, and these differences can be used by states

to focus their outreach and enrollment efforts.9

 Overall, about 23

percent—or 3.4 million—of the 15 million children who were eligible for

Medicaid were uninsured in 1996. Slightly over half of the

Medicaid-eligible children are insured solely by Medicaid, while about

7 percent have both Medicaid and private coverage. The remainder have

coverage through other public programs, such as the Civilian Health and

Medical Program of the Uniformed Services (CHAMPUS) or the Indian

Health Service. (See fig. 1.) Medicaid-eligible children who are uninsured

have characteristics closer to Medicaid-eligible children who are privately

insured than to those with Medicaid.10 They are disproportionately

children of the working poor, Hispanic, and U.S.-born children of

foreign-born parents or foreign-born, and they are more likely to live in the

West and the South.

9

We define Medicaid-eligible children as those eligible for Medicaid by federally mandated age and

income criteria: children under 6 years old with family income at or below 133 percent of the federal

poverty level and children 6 through 12 years old with family income at or below federal poverty level.

10For a comparison of Medicaid-eligible children to all uninsured children, see S. Avruch and others,

“The Demographic Characteristics of Medicaid-Eligible Uninsured Children,” American Journal of

Public Health, Vol. 88, No. 3 (1998), pp. 445-7.

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Figure 1: Percentage of

Medicaid-Eligible Children With

Different Types of Health Insurance or

Uninsured, 1996

Both Private and Medicaid

7%

Private

16% Uninsured

23%

Other

1%

Medicaid

53%

Note: Uninsured children are children who are reported to have no insurance coverage at all for

the entire year. Children reported as having health insurance coverage may have been uninsured

for part of the year. Children with more than one source of coverage reported may have had

duplicate coverage at the same time or may have had different types of coverage at different

times of the year. For this figure, more than one source of coverage is shown only for children who

have both private insurance and Medicaid coverage. Children with Medicare are included with

the Medicaid group. Children with other coverage include those with insurance obtained through

other public programs.

Uninsured

Medicaid-Eligible Children

Have Similarities With

Privately Insured Children

Medicaid-eligible children are more likely to be uninsured if their parents

work, if their parents are self-employed or employed by a small firm, or if

they have a two-parent family. Children whose parents worked at all

during the year—whether full-time, part-time, or for part of the year—are

about twice as likely to be uninsured as those whose parents were

unemployed. However, these children are more likely to be covered by

employment-based insurance. The explanation for this apparent paradox

is that children with employed parents are less likely to be covered by

Medicaid, and employment-based coverage does not fully compensate for

low rates of Medicaid participation. (See table 2.)

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Table 2: Insurance Status of

Medicaid-Eligible Children in 1996, by

Parents’ Work Status

Insurance status

Parents’ work status

Percentage

uninsured

Percentage

enrolled in

Medicaida

Percentage with

employmentbased insurancea

Full-time for entire year 32.0 38.5 30.6

Less than full-time 21.2 62.1 22.7

Not working 13.0 81.1 8.2

Note: Table is based on 96 percent of Medicaid-eligible children whose records matched with

those of their parents. (See app. I.)

aIncludes children who have both Medicaid and employment-based health insurance coverage in

the same year.

Small firms are less likely than larger firms to offer health insurance;

therefore, it is not surprising that children whose parents are

self-employed or employed by small firms are less likely to be insured.

This could suggest selective targeting of smaller firms in Medicaid

outreach efforts, especially if it is known that they do not offer insurance.

Half of all uninsured Medicaid-eligible children are in two-parent families,

compared with only about 28 percent of those insured by Medicaid. The

uninsured rate for Medicaid-eligible children is also higher in two-parent

families than in single-parent families—30 percent compared with

18 percent. This again underscores that successful outreach efforts need

to reach beyond the single unemployed mothers generally associated with

both cash assistance programs and Medicaid.

Hispanics, U.S.-Born

Children of Foreign-Born

Parents, and Immigrant

Children Are More Likely

to Be Uninsured

Among racial and ethnic groups, the proportion of uninsured

Medicaid-eligible children, as well as the proportion enrolled in Medicaid,

varies by racial and ethnic group. Among uninsured Medicaid-eligible

children, Hispanics have the highest uninsured rate, while blacks are most

likely to be enrolled in Medicaid. (See table 3 and table II.1 in app. II.)

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Table 3: Percentage of

Medicaid-Eligible Children Uninsured

and Percentage Enrolled in Medicaid in

1996, by Race and Ethnicity

Percentage

uninsured

Percentage

enrolled in

Medicaid

White 21.1 54.1

Black 18.9 69.4a

Hispanic 29.2b 58.8

Other, non-Hispanic 25.6 54.9

Total 23.0 59.7

aStatistically different from percentage for whites and Hispanics.

bStatistically different from percentage for whites and blacks.

In 1996, almost 9 out of every 10 uninsured Medicaid-eligible children were

U.S.-born, but many—over one-third—lived in immigrant families. In

addition to the 11 percent who were immigrants, another one-quarter had

at least one foreign-born parent.11 (See fig. 2.) The large number of

children in immigrant families and the high proportion that are uninsured

suggest that immigrant communities may be promising targets for

outreach. (See table 4.) Over 70 percent of children in immigrant families

are Hispanic, suggesting that outreach efforts be targeted to the Hispanic

community as well as use Spanish-language outreach materials and

applications.

11We matched children to one parent—the one with the highest workforce participation—which might

lead to a slight underestimate of children who had at least one foreign-born parent. However, in

two-parent families, spouses generally had similar birth and immigration status. (See app. I.)

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Figure 2: Medicaid-Eligible Uninsured

Children in 1996, by Birth Status of

Child and Parent U.S.-Born Child and Foreign-Born Parent

25%

Foreign-Born Child and Parent

11%

U.S.-Born Child and Parent

64%

Table 4: Percentage of

Medicaid-Eligible Children Insured and

Uninsured in 1996, by Birth Status of

Child and Parent

Characteristic

Percentage

insured

Percentage

uninsured Total number

U.S.-born child with

U.S.-born parent 81.7 18.3 11,140,000

U.S.-born child with

foreign-born parent 70.1 29.9 2,648,000

Foreign-born child with

foreign-born parent 44.5 55.5 631,000

Note: Table is based on 96 percent of Medicaid-eligible children whose records matched with

those of their parents. Children were matched to the parent with the highest workforce

participation. Less than 1 percent of children were foreign-born children with U.S.-born parents;

these children were excluded from the table.

Many Uninsured

Medicaid-Eligible Children

Are School-Age or Have

School-Age Siblings

Medicaid eligibility criteria allow younger children with higher family

income to enroll. Children under 6 years old in families with income at or

below 133 percent of the federal poverty level are eligible for the program,

according to federal mandate, as compared with older children whose

families’ income must be at or below 100 percent of the federal poverty

level. As a consequence, 54 percent of children who are Medicaid-eligible

but uninsured are less than 6 years old. Nevertheless, outreach through

schools could reach some of these younger children, since 42 percent have

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a school-age sibling aged 6 to 17. This means that it could be possible to

reach about 69 percent—or 2.4 million—of uninsured Medicaid-eligible

children through schools.

Families of

Medicaid-Eligible

Uninsured Children Are

Less Likely to Enroll for

Food Stamps Than Other

Low-Income Families

Other government programs could be used to reach families of uninsured

Medicaid-eligible children, if they were using such programs. Use of

government-subsidized services by these families might also indicate their

willingness to access certain kinds of government-sponsored programs.

While the CPS does not have information on use of public programs such as

Head Start or the Department of Agriculture’s Special Supplemental Food

Program for Women, Infants, and Children (WIC), it does have information

on family use of the Food Stamp program.

Compared with similar families with employment-based insurance or

Medicaid coverage for their children, children who were Medicaid-eligible

but uninsured were less likely to have been in families that received food

stamps. Some experts have argued that immigrant families have been less

willing to apply for subsidized benefits because of their fear of the

government or language and cultural barriers. However, we did not find

any significant difference in use of food stamps among uninsured

Medicaid-eligible children with U.S.-born parents, foreign-born naturalized

citizen parents, and foreign-born noncitizen parents.

The West and the South

Face Different and Larger

Outreach Challenges

The demographic makeup of the uninsured child population varies

geographically and by community, meaning that national analyses can only

suggest potential outreach targets and must be validated in the light of

local knowledge. Nonetheless, it is clear that the West and the South as a

whole face particular challenges. A larger proportion of Medicaid-eligible

children in these regions are uninsured—overall, the West and the South

account for 73 percent of all uninsured Medicaid-eligible children

nationwide. (See fig. 3.)

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Figure 3: Number of Medicaid-Eligible Children With and Without Health Insurance in 1996, by Region

Northeast Midwest South West

0

1,000

2,000

3,000

4,000

5,000

2,054

2,385

4,139

2,973

459 458

1,486

1,042

Insured

Uninsured

Number of Children

Note: Numbers in thousands.

Several reasons may explain the differences in proportions of uninsured

Medicaid-eligible children in different regions. Some areas have higher

proportions of workers with employment-based insurance because of the

size of local firms, type of business, or degree of unionization. As a result,

higher proportions of workers’ dependents are insured. Regions also differ

in the number and percentage of immigrant families and various ethnic

groups. All of these factors can affect insurance status and how states

conduct outreach to the uninsured.

Regions differ in the number of uninsured Medicaid-eligible children who

are Hispanic or of Hispanic descent and in the number who are members

of immigrant families. Both Hispanic and immigrant families are most

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prevalent in the West, particularly in California, where over 60 percent of

uninsured Medicaid-eligible children are Hispanic and over 70 percent live

in immigrant families. (See tables II.2 and II.3 in app. II.)

Although some differences among states are due to states’ demographic

characteristics, differences may also be due to states’ varying efforts to

extend health insurance to those who have been unable to receive

coverage and to inform these individuals of their eligibility. Having a

larger, more visible program is a mechanism that may help. Some states

have expanded Medicaid eligibility further for children than other states

and may have attracted more of their poorer Medicaid-eligible children to

enroll.12

Limited Enrollment

Due to Several

Factors

When asked why families do not enroll their Medicaid-eligible children in

the program, state officials, beneficiary advocates, health care providers,

and other experts report a variety of contributing factors. Some families

do not know about the program or do not perceive a need for its benefits.

Some families, especially those who have never enrolled in public benefit

programs, may not even be aware that they are eligible. In addition, some

parents may associate Medicaid with welfare and dependency, and

therefore have an aversion to enrolling their children in the program.

Cultural and language differences may limit awareness or understanding,

and immigration status may also affect a family’s willingness to apply.

Finally, the eligibility process can be difficult for working families because

of the limits on where and when enrollment can take place, the lengthy

application, and the documentation required. These barriers to the

enrollment process can be reduced, but in reducing the length of the

application and the amount of documentation a balance must be struck

between maximizing enrollment and minimizing program abuse.

Families May Lack

Knowledge of Medicaid

and Its Eligibility Criteria

Most state officials, advocates, providers, and other experts whom we

interviewed agreed that many families are unaware of Medicaid. Even

families who know about the program may not realize that they could be

eligible. With the long-standing link between Medicaid and AFDC, many

families—both those who have never received welfare and those who

have—assume that if they are not receiving cash assistance, they are not

eligible for Medicaid. Two types of families tend to be unaware of their

12States like Washington, Tennessee, and Minnesota developed subsidized health insurance for

low-income families, partially or entirely funded through Medicaid. They may also have reduced the

percentage of uninsured Medicaid-eligible children through attracting low-income uninsured families

to their program.

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eligibility: working families who assume that Medicaid eligibility is tied to

welfare eligibility and families who were previously on welfare and believe

that, because of welfare reform, they are no longer eligible for Medicaid.

These families are unlikely to understand that children with higher levels

of family income may be eligible for Medicaid. Complex eligibility

rules—which can result in younger children being eligible while their elder

siblings are not—can simply add to families’ confusion.

Families May Not Perceive

a Need for Medicaid Due to

Good Health and

Alternative Sources of

Care

Several state officials, providers, and one expert told us that some families

do not become concerned about health care access until their children

become sick and, therefore, do not enroll them in Medicaid—especially if

the children are relatively healthy. In addition, if families have successfully

sought and received care for their children from clinics or emergency

rooms in the past without enrolling in a health care program such as

Medicaid, they are likely to continue to seek care from these providers.

Cultural Differences,

Language Barriers, and

Immigration Policies May

Keep Some Families From

Enrolling in Medicaid

State officials, advocates, and other experts told us that some families are

hesitant to enroll in Medicaid because of cultural differences, language

barriers, and their understanding of U.S. immigration policies. Experts and

a state official said that cultural differences may keep immigrant families

from enrolling in Medicaid. Language was often mentioned as a barrier.

Individuals who cannot read the Medicaid application and informational

materials and cannot easily converse with eligibility workers by telephone

or in person are at a distinct disadvantage. One expert told us that the

degree of acculturation has a major impact on whether an immigrant will

use public assistance of any kind. While time spent in the country is the

main predictor of acculturation, some individuals may not participate in

mainstream society and use its institutions even after living in the country

for many years.

According to some state officials, advocates, and experts, immigrant

families may also hesitate to enroll in Medicaid because they are

concerned that it will negatively affect their immigration status.

Immigrants who are legal residents may be afraid that if they receive

benefits that they will be labeled a “public charge” and will have

difficulties with the Immigration and Naturalization Service (INS) when

applying for naturalization, visa renewal, or reentry into the United

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States.13 Although advocates question whether aliens receiving benefits

may be considered public charges, in some instances actions have been

taken against such individuals seeking visa renewals. Several advocates

also told us about cases where individuals were prevented from reentering

the United States unless they agreed to reimburse Medicaid for services

paid for by the program on their behalf—particularly in border states such

as California.14 Publicity about such cases in the immigrant community

can deter immigrants from applying for Medicaid benefits for themselves

or their children—even in cases where the children were born in the

United States and are American citizens.

In families where one or more adults are in the country illegally, the

reluctance to seek Medicaid benefits for a child may be even greater.

When applying for Medicaid for children, families in some states are asked

about the immigration status of other members of the household. Again,

advocates told us this is a deterrent to enrollment for such families and

reported that many immigrant families, both legal and illegal, seek medical

assistance through county clinics and public hospitals because these

institutions are viewed as more sympathetic and less likely to ask

questions about immigration status.

Perceived Negative Image

Attached to Medicaid May

Deter Enrollment

State officials and other experts told us that because of its long-standing

ties with welfare and other benefit programs, many families associate

Medicaid with a family that cannot provide for itself. Experts report that

many working poor and near poor do not want to be labeled as welfare

recipients, even if the law entitles their children to benefits. They often

take the view that they never have received welfare and do not want to

start.

Enrollment Process Can

Be a Barrier

State officials, beneficiary advocates, providers, and other experts agree

that Medicaid enrollment processes and requirements have often been

13Aliens may be excluded from entering the United States if it is determined that they are likely to

become public charges. If already in the United States, they may be deported if they have become

public charges. Neither the law nor the regulations specify whether receipt of benefits such as

Medicaid would cause someone to be deemed a public charge.

14In a December 17, 1997, letter to state Medicaid directors, HCFA stated that when an alien has

legitimately received Medicaid benefits, the beneficiary is not indebted to the state. The letter also said

that states do not have the authority to collect repayments of benefits from current or former

beneficiaries except in cases where those benefits were fraudulently received or an overpayment had

occurred. Further, the letter said that state Medicaid agencies are not authorized to provide

information about the receipt of benefits or the dollar amount of these benefits to INS, the State

Department, or immigration judges. In a December 17, 1997, memorandum to its offices, INS said that

it does not have the authority to require or request that aliens repay public benefits, and lawful

permanent residents who have been outside the United States 180 days or less should not be

questioned on issues related to the likelihood that they would be a public charge.

Page 16 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
B-278558 

barriers. However, to ensure that all recipients of Medicaid benefits meet

income and other requirements, states have found it necessary to develop

application processes that

• use lengthy application forms and

• require extensive documentation.

State officials, beneficiary advocates, and other experts told us that

lengthy enrollment forms and the associated documentation requirements

create a barrier for families. Long forms are often used when a family is

applying for a combination of programs, including Medicaid. Numerous

questions relating to income, assets, citizenship, and family composition

are used to determine eligibility and to ensure that only those who are

entitled to benefits are enrolled in Medicaid. In addition to length,

enrollment forms often require extensive documentation. Families are

asked to provide paystubs, bank account statements, birth certificates, and

other documents that verify the information they provide on the forms.

Gathering such documents can be burdensome. For example, obtaining a

birth certificate can involve going to a different office and then returning

to the eligibility office. Obtaining certain documents can also require a

family to pay a fee.

A valid and reliable eligibility determination process is important to state

officials to ensure program integrity. In addition, states can be assessed a

financial penalty by the federal government if their error rates are too

high. In an effort to balance these needs, most states have developed

shorter forms for children who are applying exclusively for Medicaid,

primarily by dropping the asset requirements. Some advocates, however,

are still concerned with the length and complexity of application forms

and the number of questions they contain. One advocate suggested that if

applicants cannot understand the form, they are not going to fill it out.

Another advocate pointed out that some questions may be well-intended,

but they nonetheless lengthen the application. For example, as a way of

identifying if the family may be eligible for other benefit programs, some

states’ applications ask questions related to disability. In addition,

advocates pointed out that the documentation requirements are so

stringent in some states that many applicants are denied enrollment

because they cannot produce the documentation required. In an earlier

report, we found that such requirements were shown to account for nearly

half of all denials.15

15Health Care Reform: Potential Difficulties in Determining Eligibility for Low-Income People

(GAO/HEHS-94-176, July 11, 1994).

Page 17 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
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In addition to limits that were developed as part of a legitimate effort to

maximize the accuracy of eligibility determinations and monitor the

eligibility process, other barriers exist. These include

• location of enrollment sites and enrollment hours;

• fluctuations in eligibility status, including the impact of welfare reform;

and

• families’ lack of transportation and communication problems.

Many of the state officials and other experts with whom we spoke said

that the enrollment process used for welfare was difficult for working

families because enrollment locations are limited and open only during

typical work hours. This makes it difficult for working parents in families

whose children may be eligible for Medicaid to apply. Such parents may

not have the flexibility in their job to take time off to enroll through

face-to-face interviews, according to one state official and one expert.

States are required to provide for the receipt and initial processing of

applications for pregnant women, infants, and children at sites not used

for AFDC applications—such as federally qualified health centers and

hospitals that serve a larger share of uninsured and publicly insured

persons—but these efforts may have been limited.

Experts also noted that the eligibility system does not accommodate the

fluctuating eligibility status of many families. Low-income working

families may have changes in their income if they work seasonally or

change or lose jobs. A family eligible one month may not be eligible the

next month because of an increase in family income, but children in that

family may still be covered under other categories of eligibility. According

to experts, some states’ eligibility processes do not automatically make

redeterminations to see if children who lose their eligibility might be

eligible in another category. If the family does not reapply, the child loses

coverage.

Advocates have also been concerned that welfare reform may make

enrollment less likely. Families may be confused about their Medicaid

eligibility because, prior to welfare reform, Medicaid and cash assistance

had, historically, been so closely linked. For example, if TANF enrollment

workers focus on job search strategies and not on benefits, families who

come in may not be enrolled for Medicaid. In addition, some families may

believe Medicaid is time limited as is TANF.

Page 18 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
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According to experts, advocates, and one provider, limits on the ability to

communicate and availability of transportation can be a barrier for

applicants. In addition to difficulties for non-English-speaking families,

illiteracy may also limit a parent’s ability to enroll without substantial

assistance. Experts also pointed out that lack of transportation to

enrollment sites can be a barrier, primarily in rural areas, but also in some

urban settings. A family may not have a car or have limited time and

money to make a long trip to the welfare office.

Some States Use

Innovative Strategies

to Target Outreach

and Encourage

Enrollment

To enroll eligible children in Medicaid, some states are using innovative

strategies that are intended to increase knowledge and awareness of the

program and its benefits, minimize the perceived social stigma, and

simplify and streamline the eligibility process. Education and outreach

programs are often targeted to families who have children potentially

eligible for Medicaid. Visible support from state leadership and

partnerships with community groups are viewed by state officials and

advocates as essential to obtaining the necessary resources to implement

outreach programs. Some states have even renamed the Medicaid program

as a way to change its image. To improve the enrollment process, some

states have adopted strategies to assist immigrant families or have

simplified and streamlined the eligibility process by shortening forms and

accepting applications at many new sites, as well as mail-in applications.

However, this kind of simplification and streamlining has required state

officials to make difficult trade-offs between the need for program

integrity and higher Medicaid enrollment.

Multifaceted Outreach

Programs Intended to

Educate Targeted Families

The states that we contacted have developed multifaceted outreach

programs to educate families on the availability of the Medicaid program

and the importance of enrolling their children. They generally agreed that

a successful education and outreach program should

• target outreach to low-income working families with children, using

nontraditional methods and locations, and

• work in collaboration with community groups, schools, providers, and

advocates.

These themes are broadly consistent with several findings from our

demographic analysis: low-income working families with children have a

high uninsured rate, and most uninsured Medicaid-eligible children are in

Page 19 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
B-278558 

school or have a sibling in school, which makes the schools an available

avenue for reaching children and families.

The states that we studied have employed a variety of methods to

publicize Medicaid. For example, Massachusetts has placed outreach

workers in health centers, hospitals, and other traditional locations;

distributed literature in schools; sent material to the YMCA and other

community groups; and worked with a supermarket chain to place in

grocery bags notices of the program. The governor has held several press

conferences around the state to publicize the program, and the state is

working with workers in WIC clinics, who are already trained to do

income-based eligibility assessments. The state has also used its

enrollment data to target communities that have low levels of Medicaid

enrollment and worked with local officials to address the problem. The

state’s private contractor for managed care enrollment has also assisted

with outreach through its presentations in the community. One advocacy

group worked with the state to develop a campaign to target high-school

athletes, who are required to have health insurance. This campaign

involved sending posters and fold-out fliers—developed and produced

with the donated time of professionals—to athletic directors in high

schools throughout the state and establishing a pool of student athletes to

go out and talk to their peers. In another initiative, the state medical

society is training its members’ staffs to assist in educating families about

program eligibility and benefits. Finally, Massachusetts is making $600,000

available to help community groups conduct outreach and educate

families of uninsured Medicaid-eligible children, with the money

distributed as grants in amounts between $10,000 and $20,000.

In Arkansas, as part of a large media campaign that included television and

radio announcements, the state placed color inserts in Sunday newspapers

during September 1997. These inserts provided information on program

eligibility and benefits, a toll-free number to obtain additional information,

as well as a photograph of children with the governor endorsing the

program. The state’s children’s hospital paid for the insert. Applications

are available at schools, pharmacies, and churches, and brochures have

also been placed in fast food bags. The state has also worked with its

children’s hospital to place enrollment forms at affiliated clinics, which are

located throughout the state.

Georgia has made a major commitment to outreach by employing over 140

eligibility workers with the specific job of getting eligible children and

families enrolled in Medicaid. These outreach workers are situated in

Page 20 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
B-278558 

numerous locations, including health departments, clinics, and hospitals.

These workers also temporarily set up at nontraditional sites, such as

schools, community agencies, and shopping malls. The outreach workers

are often available during evening and weekend hours as a convenience to

working families. Workers also make presentations regularly to

community groups, medical providers, and employers. A flier was

developed that is targeted to employers to inform them about benefit

programs for which their employees may be eligible. Georgia is also trying

to enroll former welfare recipients by emphasizing Medicaid enrollment as

an important part of a successful transition to work. The state’s outreach

program has also established partnerships with numerous community

groups—including local coordinating councils, local teen pregnancy task

forces, and school boards—and has used these local partnerships to

develop outreach tailored to needs and characteristics of the communities.

The state’s private contractor for enrollment in managed care has also

assisted with the outreach program through its contacts with the

community.

In view of its recent welfare reform initiatives, Wisconsin is making a

concerted effort to ensure that Medicaid-eligible individuals enroll in

Medicaid regardless of their eligibility for the state welfare program. As

part of this outreach effort, the state has begun to target county eligibility

workers, individual providers, and Medicaid-eligible individuals to

communicate that people may still qualify for medical assistance apart

from their eligibility for welfare. Additional resources have been made

available for outreach, outstationing, and training materials for staff. To

plan its outreach efforts, the state is working with outside groups,

including the Primary Health Care Association, the state medical society,

Milwaukee County, Children’s Hospital, and Marshfield Clinic.

Few States Tailor

Programs to Immigrant

and Ethnic Communities

We found less targeting of immigrant communities than might have been

expected from the demographic analysis, although this was in some

measure due to the characteristics of the states that we selected for our

study. However, advocates report concern within the immigrant

communities that receiving benefits will compromise their immigration

status. One expert told us that some states have attempted to assist

eligible immigrant families in enrolling their children by providing

enrollment information and applications in alternative languages,

particularly Spanish, and by hiring bilingual enrollment workers. In

general, their outreach approach is similar to those tailored to other

communities but with an emphasis on particular immigrant and ethnic

Page 21 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
B-278558 

cultures and languages. Massachusetts is working with local community

groups that provide information and educate immigrants on the

availability of Medicaid. Georgia’s outreach workers give presentations to

employee groups within firms that have a large proportion of Hispanic

immigrants among their workers.

In their outreach efforts, states face challenges with the immigrant

community because they have to take into account the recent changes of

the Welfare Reform Act and the Balanced Budget Act, which make

benefits a state option for qualified immigrants who arrived before

August 23, 1996, and bar immigrants for 5 years if they arrived after

August 22, 1996. However, these limitations do not affect the eligibility of

native-born children in immigrant families.

Name Change and

Outreach Initiatives

Intended to Project More

Positive Program Image

States have tried to change the perception that Medicaid is tied to welfare

and dependency in a variety of ways. The most direct method for changing

the program’s image is changing the program’s name. In addition, states

have advertised the program as one that is intended for working families,

while some have included policies to avoid displacing private health

insurance. They have also adopted alternative enrollment methods so that

individuals do not have to go to the local welfare office to enroll.

Changing the Medicaid program’s name is not new, but it has become

more widespread.16 Massachusetts recently renamed its program

MassHealth with the intent that it would be more appealing to

beneficiaries. MassHealth fliers describe several option plans available

(six in total), referring to them by names such as “MassHealth Standard”

and “MassHealth Basic”—names similar to commercial health plans.

Arkansas named its Medicaid expansion program for children ARKids 1st.

The logo for the program uses bright colors with the “1” in 1st represented

by a crayon. Georgia has not changed the name of Medicaid, but its

outreach project is called “Right From the Start” to project a positive

message.17

Advertisements and fliers for these programs emphasize that they are for a

broad population, not just those on welfare. MassHealth fliers state,

16Some states changed their Medicaid name for pregnant women and infants when they began

outreach to these populations in the late 1980s.

17States also often provide identification cards that look like cards in commercial plans. This is also

prevalent in managed care programs where the beneficiary gets the same managed care plan card as

non-Medicaid members.

Page 22 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
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“There is no reason why a child or a teen in Massachusetts should go

without health care.” Massachusetts has fliers that outline income levels

for eligibility that show families with almost $2,400 a month in income and

pregnant women with income up to $3,300 a month as eligible. Georgia has

a flier entitled, “Have you heard about benefits for working families?,” and

the first program mentioned is Medicaid for children. Another flier

targeted to families leaving welfare to work asks the question, “Did you

know you could work full time and still receive some benefits?” (See fig.

4.)

Page 23 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
B-278558 

Figure 4: Outreach Materials From Arkansas, Georgia, and Massachusetts

Page 24 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
B-278558 

To minimize the possibility of displacing private insurance, known as

“crowd out,” some states have policies to address the issue. The Medicaid

program cannot refuse enrollment to any eligible individual based on the

fact that he or she has insurance, although Medicaid is the payer of last

resort. However, some states that have expanded eligibility through

waivers of normal program rules have been allowed to limit eligibility if a

family already has insurance. For example, in Arkansas, which received a

waiver for its expansion, a child is not eligible for ARKids 1st unless he or

she has been uninsured for a period of 12 months or the child lost

insurance coverage during that period through no fault of the family. In

Massachusetts (which also has a waiver for expansion) and Georgia,

officials are cognizant of the potential dangers of crowd out.

Massachusetts, as part of MassHealth, will subsidize the cost of insurance

available to the family.

States Change Enrollment

Process in Various Ways to

Attract Working Families

Some states have developed a number of strategies to make the

enrollment process easier for working families. Several states, as part of

their outreach effort, have outstationed eligibility workers in sites that

families frequent as an alternative to enrolling at the welfare office. In

addition, states have simplified and shortened their enrollment

applications, allowed applications by mail, dropped asset requirements,

and reduced documentation requirements. To help ensure continued

coverage of children in families whose income fluctuates, states can

provide continuous eligibility. Of the states we contacted, only Arkansas

has adopted continuous eligibility for a year for children.

Some states have adopted enrollment methods that do not require

individuals to visit a welfare office, in part to minimize Medicaid’s

association with welfare and welfare families. If families are only seeking

Medicaid enrollment for children, Massachusetts and Arkansas allow

families to ask questions and request an application by telephone. These

two states also accept applications by mail. Completing applications with

outreach workers at various nontraditional sites is another way the

process is made easier for working families and those without

transportation.

Each of the states with whom we spoke had shortened and simplified their

enrollment form. Massachusetts officials used focus groups to find out

why families did not enroll their children and how barriers to enrollment

could be removed. Suggestions from the focus groups—such as adding

more space on the enrollment form—helped the state design a simplified

Page 25 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
B-278558 

form that is easier to read. States have had the option of dropping the

asset tests for certain populations. When Arkansas dropped its asset test

for the ARKids 1st program, it also dropped the related questions about

assets and property, shortening the enrollment form to four pages. Georgia

also shortened its enrollment form and dropped the asset test.

States are concerned with maintaining program integrity and ensuring that

benefits go only to qualified individuals. However, 40 states have abolished

the asset test for some or all children, primarily because the likelihood

that these families have substantial assets is low. Table 5 shows the

number of states that have made these changes.

Table 5: Number of States That Have

Made Changes to the Enrollment

Process Dropped asset test 40a

Shortened eligibility form 30

Adopted mail-in enrollment 25

aFour states have dropped their asset test for some but not all eligible children.

Source: Center on Budget and Policy Priorities.

Few efforts have been made to address the problem of fluctuating family

eligibility status, causing children to be inappropriately disenrolled from

Medicaid. As part of its ARKids 1st program, Arkansas is providing 12

months of continuous eligibility to children regardless of changes in family

income, under waiver authority granted by HCFA. Until recently, states had

to receive a waiver to pursue such a policy. The Balanced Budget Act,

however, allows states to adopt 12 months of continuous eligibility.

To date, welfare reform has not significantly affected the application

process for Medicaid. In a recent report, we found that nine states we

contacted have chosen to make few structural changes in their Medicaid

programs in the first full year of implementing welfare reform. For

example, while the Welfare Reform Act delinked eligibility for cash

assistance and Medicaid, the states that we contacted had generally

decided not to separate Medicaid and cash assistance program

administration. In three of the states that we spoke with for this study,

welfare applicants received a combined form that permits families to apply

for both cash assistance and Medicaid, but families applying only for

Medicaid receive a shorter form with a subset of questions.

Page 26 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
B-278558 

Conclusions Despite the importance of and large investment in providing health care to

children in low-income families, difficulties in enrolling them in Medicaid

leave more than 3 million children vulnerable. The states that we reviewed

recognized that uninsured Medicaid-eligible children are generally in

working two-parent families and have targeted their outreach accordingly.

Targeting working families raises the issue of crowd out—replacing

employer-based insurance with Medicaid—but states that we contacted

have not seen this as a major problem given the low income levels of these

families. Only Arkansas has taken direct action to discourage employers

from dropping health insurance coverage by enforcing a 12-month waiting

period.

We found less outreach targeted to Hispanics and immigrants, and experts

whom we interviewed said this was generally true, even in states with

large immigrant or Hispanic populations. Immigrants, particularly families

in which the parents are not naturalized U.S. citizens, are likely to be a

more difficult group to reach, both because of the complexities of the law,

which makes some but not all immigrant children eligible for Medicaid,

and because of the immigrants’ general wariness of government. Some

immigrant families include children who—because they were born in this

country—are citizens and fully eligible for Medicaid.

The states that we studied are, for the most part, using outreach and

enrollment strategies available for some time—but not necessarily used

for enrolling uninsured children. However, other strategies provided for by

the Balanced Budget Act—such as continuous enrollment and

presumptive eligibility—have not been widely implemented. CHIP also has

considerable potential for identifying uninsured Medicaid-eligible children.

The law provides that any child who applies for CHIP and is determined to

be Medicaid-eligible should be enrolled in Medicaid. The more that states

publicize CHIP, the greater the number of uninsured Medicaid-eligible

children they are likely to identify and enroll in Medicaid—particularly if

the states’ screening and enrollment process effectively identifies

Medicaid-eligible children and enrolls them in the Medicaid program.

Agency Comments We sought comments on a draft of this report from HCFA; from state

officials in Arkansas, Georgia, Massachusetts, and Wisconsin; and from

experts on children’s health insurance issues with the Southern Institute

on Children and Families and the Center on Budget and Policy Priorities. A

number of these officials provided technical or clarifying comments,

which we incorporated as appropriate. In addition, HCFA noted that it had

Page 27 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
B-278558 

sent a letter dated January 23, 1998, to state officials to encourage them to

simplify enrollment and expand outreach to the Medicaid-eligible

population.

As arranged with your office, unless you announce its contents earlier, we

plan no further distribution of this report until 30 days after its issuance

date. At that time, we will send copies to the Secretary of Health and

Human Services, the Administrator of HCFA, the directors of the state

programs we spoke with; and interested congressional committees. Copies

of the report will be made available to others upon request.

If you or your staff have any questions about the information in this report,

please call me or Phyllis Thorburn, Assistant Director, at (202) 512-7114.

Other contributors to this report were Richard Jensen, Sheila Avruch, and

Sarah Lamb.

Sincerely yours,

William J. Scanlon

Director, Health Financing and

 Systems Issues

Page 28 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Page 29 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Contents

Letter 1

Appendix I 

Scope and

Methodology

32

About the CPS 32

How We Defined Insurance, Medicaid Eligibility, and Family

Status

32

Comparing CPS and Other Surveys 35

Appendix II 

Demographics of

Medicaid-Eligible

Children Who Are

Uninsured

39

Related GAO Products 44

Tables Table 1: Summary of Medicaid Eligibility for Aliens 6

Table 2: Insurance Status of Medicaid-Eligible Children in 1996,

by Parents’ Work Status

9

Table 3: Percentage of Medicaid-Eligible Children Uninsured and

Percentage Enrolled in Medicaid in 1996, by Race and Ethnicity

10

Table 4: Percentage of Medicaid-Eligible Children Insured and

Uninsured in 1996, by Birth Status of Child and Parent

11

Table 5: Number of States That Have Made Changes to the

Enrollment Process

26

Table I.1: Definition of Work Status of Parent or Parents 34

Table I.2: Estimates of the Number of Uninsured Children Who

Are Eligible for Medicaid but Are Uninsured, by Source

37

Table II.1: Number and Percentage of Medicaid-Eligible Children

Who Were Insured by Medicaid or Uninsured in 1996, by Race

and Ethnicity

39

Table II.2: Percentage of Uninsured Medicaid-Eligible Children in

1996, by Race and Ethnicity and by Region

39

Table II.3: Percentage of Uninsured Medicaid-Eligible Children in

1996, by Parents’ Birth Status and Region

40

Figures Figure 1: Percentage of Medicaid-Eligible Children With Different

Types of Health Insurance or Uninsured, 1996

8

Page 30 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Contents

Figure 2: Medicaid-Eligible Uninsured Children in 1996, by Birth

Status of Child and Parent

11

Figure 3: Number of Medicaid-Eligible Children With and Without

Health Insurance in 1996, by Region

13

Figure 4: Outreach Materials From Arkansas, Georgia, and

Massachusetts

24

Abbreviations

AFDC Aid to Families With Dependent Children

CHAMPUS Civilian Health and Medical Program of the Uniformed

Services

CHIP Children’s Health Insurance Program

CPS Current Population Survey

CTS Community Tracking Study

HCFA Health Care Financing Administration

INS Immigration and Naturalization Service

PRUCOL persons residing under color of law

SIPP Survey of Income and Program Participation

SSI Supplemental Security Income

TANF Temporary Assistance for Needy Families

WIC Special Supplemental Food Program for Women, Infants,

and Children

Page 31 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Appendix I 

Scope and Methodology

To examine the demographic characteristics of Medicaid-eligible

uninsured children, we analyzed the Current Population Survey (CPS),

which is used by some researchers to measure health insurance coverage

in the United States. This technical appendix discusses the survey, how we

measured insurance coverage and estimated Medicaid-eligible children,

and how we determined parents’ work effort and immigration status. It

also discusses some concerns about how well the CPS measures insurance

coverage and compares our estimate of the number of Medicaid-eligible

uninsured children with other analysts’ estimates.

About the CPS The CPS, a monthly survey conducted by the Bureau of the Census, is the

source of official government statistics on employment and

unemployment. Although the main purpose of the survey is to collect

information on employment, an important secondary purpose is to collect

information on the demographic status of the population, such as age, sex,

race, marital status, educational attainment, and family structure. The

March supplement of the CPS survey collects additional data on work

experience, income, noncash benefits, and health insurance coverage of

each household member at any time during the previous year.

The CPS sample is based on the civilian, noninstitutionalized population of

the United States. About 48,000 households with approximately 94,000

persons 15 years old and older and approximately 28,000 children aged 0

to 14 years old are interviewed monthly. The sample also includes about

450 armed forces members living in households that include civilians and

are either on or off a military base. For the March supplement, an

additional 2,500 Hispanic households are interviewed. The households

sampled by the CPS are scientifically selected on the basis of area of

residence to represent the United States as a whole, individual states, and

other specified areas.

How We Defined

Insurance, Medicaid

Eligibility, and Family

Status

Health Insurance Coverage

Status

Children can have multiple sources of health insurance coverage in the

same year. The CPS asks about all sources of health insurance coverage. It

Page 32 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Appendix I 

Scope and Methodology

is impossible to tell, for example, if a child is reported as having both

Medicaid and employment-based insurance, whether the child had

duplicate coverage, had Medicaid coverage first and then

employment-based coverage, or vice versa. For this report, children who

had employment-based insurance were reported as having such coverage

even if they also had other sources of coverage. Likewise, children who

had Medicaid coverage were reported as having such coverage even if they

had other sources of coverage. As result, some children were reported as

having both public and private coverage—usually Medicaid and

employment-based insurance—for the same year. (See fig. 1.)

For this report, children who are uninsured are children for whom no

source of coverage during the entire previous year is reported. CPS asks

specific questions about whether any members of the household have

coverage provided through an employer or union; purchased directly; or

have Medicare, Medicaid, or other public coverage. However, it does not

directly ask whether an individual is uninsured if no source of coverage is

reported.

Medicaid-Eligible Children

Who Are Uninsured

We defined Medicaid-eligible children in 1996 as children eligible by

federal mandate based on age and poverty criteria—children from birth

through 5 years old with family income at or below 133 percent of the

federal poverty level and children 6 through 12 years old with family

income at or below the poverty level.

We used income in the immediate family rather than the household

income to calculate poverty levels. We did this because states have

specific rules on what income can be deemed available to the child to

determine Medicaid eligibility, and it may not include income provided to

the household by people not related to the child. In addition,

employment-based health insurance is usually only available to immediate

dependents; therefore, the income and work effort within the nuclear

family is more relevant to whether or not the child is insured.

Matching Children With

Parents

We matched children’s records with parents’ records to analyze family

characteristics. CPS considers a family to be two or more persons residing

together and related by birth, marriage, or adoption. The Census Bureau

develops family records for the householder (a person in whose name the

housing unit is owned, leased, or rented or, if no such person, an adult in

the household); other relatives of the householder with their own

Page 33 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Appendix I 

Scope and Methodology

subfamilies; and unrelated subfamilies. If the house is owned, leased, or

rented jointly by a married couple, the householder may be either the

husband or wife. We paired children’s records to their parents’ records or,

lacking a parent, another adult relative (aged 18 through 64) in their

immediate family whom we called a parent. After this pairing, we matched

the adult family member’s record to his or her spouse’s record, if any, to

get “parents” in our file. We were not able to match all children’s records

with records of parents or other relatives in their households. For

Medicaid-eligible children, we matched 96 percent of the children’s

records. For Medicaid-eligible uninsured children, we matched 92 percent

of the children’s records. Some of our tables and figures are based on the

entire file of children’s records; others are based on the matched file and

are so indicated.

Determining Parents’ Work

and Education Status

Matching parents with children to analyze the association of workforce

participation and insurance for children helped us develop a more

accurate picture of uninsured and Medicaid-insured children with working

parents. We analyzed parent work status on the basis of information about

the parent who worked the most. (See table I.1.) This allowed us to more

accurately portray the work status of parents in two-parent families.

Where two parents were working in the same status—such as

full-time—we matched to the first parent in that work status.

Table I.1: Definition of Work Status of

Parent or Parents Work status Reported as Definition

Full-time, full year Full-time, full year Either parent worked full-time, full year.

Full-time, part year Less than full-time,

full year

Neither parent worked full-time, full year, but

at least one worked full-time part of the year.

Part-time, full year Less than full-time,

full year

Neither parent worked full-time, but at least

one parent worked part-time for the entire

year.

Part-time, part year Less than full-time,

full year

Neither parent worked either full-time or full

year, but at least one parent worked part-time

for part of the year.

Not working Not working Neither parent worked at all during the entire

year.

We used the parent with the greater workforce participation to determine

children’s birth and immigration status relative to their parents’. This

could lead to a slight underestimate of children in immigrant families,

since in some two-parent families, spouses do not have the same birth or

citizenship status. However, spouses generally share similar birth and

Page 34 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Appendix I 

Scope and Methodology

citizenship status. We examined birth and citizenship status of one parent

compared with the other in two-parent families and found that over

90 percent had the same birth and citizenship status as their spouse. Since

only about half of Medicaid-eligible children live in two-parent families to

begin with, matching to one parent would lead to over 95 percent of

children being accurately categorized, based on a match with one parent.

Comparing CPS and

Other Surveys

Some researchers who work with survey data to assess health insurance

status of the U.S. population are concerned that the currently used

surveys, including CPS, may not accurately reflect health insurance

coverage in the United States.18 CPS and the Survey of Income and Program

Participation (SIPP)—another survey that is often used to assess health

insurance coverage—report lower Medicaid coverage than HCFA data on

Medicaid enrollment. Comparing CPS and SIPP data for similar periods of

time, some researchers have concluded that although the CPS asks about

insurance coverage for the entire previous year, respondents are reporting

coverage based on a shorter time frame—perhaps 4 to 6 months.

Researchers at the Urban Institute have concluded that some of the

uninsured actually have coverage, probably Medicaid coverage, and adjust

their estimates of the uninsured accordingly.

Although health researchers are concerned that the CPS may not be ideal

for analyzing health insurance coverage, neither is any other currently

available survey. Therefore, many researchers continue to use it. GAO

chose to use CPS data for its analysis of children’s health insurance

coverage for several reasons. The CPS can be used to look at trends over

time, although care must be taken when making comparisons between

years because of questionnaire and methodological changes. It has a large

sample, which gives estimates from the data more statistical power. It was

designed so that it can be used for some state-level estimates.

Information from new health insurance surveys is or is becoming

available. The National Health Interview Survey periodically asks

questions about health insurance coverage, and the Agency for Health

Care Policy and Research has released preliminary 1996 estimates of

health insurance coverage from the Medical Expenditure Panel Survey.

The Center for Studying Health System Change has surveyed health

insurance coverage in 1996 and 1997 in its Community Tracking Study

(CTS) and is beginning to publish its data. The Urban Institute has also

18A good summary of these issues can be found in Kimball Lewis, Marilyn Ellwood, and John Czajkas,

Children’s Health Insurance: A Review of the Literature (Washington, D.C.: Department of Health and

Human Services, Dec. 17, 1997).

Page 35 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Appendix I 

Scope and Methodology

developed and fielded its own health insurance survey. Comparisons of

these surveys with the CPS and SIPP may help researchers more definitively

agree on the number of uninsured Americans and trends in insurance over

time.

Comparing Estimates of

Medicaid-Eligible Children

Who Are Uninsured

Using either CPS or new CTS data, five different groups of researchers

compared estimates of uninsured Medicaid-eligible children. (See table

I.2.) While the number of Medicaid-eligible children and definition of

Medicaid eligibility used by the researchers differed, all came up with a

similar conclusion—many uninsured children are eligible for Medicaid.

The researchers’ estimates ranged from 24 to 45 percent.

Page 36 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Appendix I 

Scope and Methodology

Table I.2: Estimates of the Number of Uninsured Children Who Are Eligible for Medicaid but Are Uninsured, by Source

Uninsured children eligible for

Medicaid

Source Survey Time period

Age group of

Medicaideligible

uninsured

children Eligibility criteria

Number (in

millions)

Percentage of

uninsured

Urban Institute’s

TRIM2 modela

CPS, March

1996

1995 Less than 18

years

State-specific

poverty-related and

AFDC- eligible; SSI

children; medically

needy children;

estimated assets

1.6a 24b

Reschovsky (1997) CTS late 1996- early

1997

Less than 19

years

State-specific

poverty-related

3.1 35c

Thorpe (1997b) CPS, March

1996

1995 Less than 19

years

Not given 3.3 31c

GAO (1996) CPS, March

1995

1994 Less than 12

years

Federal-povertyrelated; not

state-specific

2.9 30b

GAO (1998) CPS, March

1997

1996 Less than 13

years

Federal-povertyrelated only; not

state-specific

3.4 33b

Center on Budget and

Policy Priorities (1997)

CPS, March

1995

1994 Less than 11

years

Federal-povertyrelated; not

state-specific

2.7 45d

aDecreases estimate of uninsured and increases Medicaid enrollment to adjust for differences

between HCFA Medicaid enrollment data and CPS data.

bEstimate of the percentage of uninsured children less than 18 years old who were Medicaid

eligible.

cEstimate of the percentage of uninsured children less than 19 years old who were Medicaid

eligible.

dEstimate of the percentage of uninsured children less than 11 years old who were Medicaid

eligible.

Source: Kimball Lewis, Marilyn Ellwood, and John L. Czajka, Children’s Health Insurance

Patterns: A Review of the Literature (Cambridge, Mass.: Mathematica Policy Research, Inc.,

1997).

Nonsampling Error Since CPS estimates come from a sample, they may differ from figures from

a complete census using the same questionnaires, instructions, and

enumerators. A sample survey estimate has two possible types of errors:

sampling and nonsampling. Each of the studies mentioned above—using

either CPS or other sampling surveys—has the same possible errors. The

accuracy of an estimate depends on both types of error, but the full extent

Page 37 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Appendix I 

Scope and Methodology

of the nonsampling error is unknown. Several sources of nonsampling

errors include the following:

• inability to get information about all sample cases;

• definitional difficulties;

• differences in interpretation of questions;

• respondents’ inability or unwillingness to provide correct information;

• respondents’ inability to recall information;

• errors made in data collection, such as recording and coding data;

• errors made in processing data;

• errors made in estimating values for missing data; and

• failure to represent all units with the sample (undercoverage).19

19Bureau of the Census, Current Population Survey, March 1997, Technical Documentation

(Washington, D.C.: U.S. Department of Commerce, Bureau of the Census, Economics and Statistics

Administration, 1997).

Page 38 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Appendix II 

Demographics of Medicaid-Eligible Children

Who Are Uninsured

Tables II.1 through II.3 provide a demographic profile of Medicaid-eligible

children in 1996.

Table II.1: Number and Percentage of Medicaid-Eligible Children Who Were Insured by Medicaid or Uninsured in 1996, by

Race and Ethnicity

Medicaid Uninsured

Number (in thousands) Percentage enrolled Number (in thousands) Percentage

White 3,175 54.1 1,238 21.1

Black 2,883 69.4a 784 18.9

Hispanic 2,424 58.8 1,205 29.2b

Other, non-Hispanic 465 54.9 217 25.6

Total 8,947 59.7 3,445 23.0

Note: Numbers may not add to totals due to rounding.

aStatistically different from rate for whites and Hispanics.

bStatistically different from rate for whites and blacks.

Table II.2: Percentage of Uninsured Medicaid-Eligible Children in 1996, by Race and Ethnicity and by Region

Total

White,

non-Hispanic

Black,

non-Hispanic Hispanic

Other,

non-Hispanic Percentage

Number (in

thousands)

Northeast 38.0 23.0 30.7 8.3 100 459

Midwest 48.6 32.4 14.4 4.6 100 458

South 37.1 30.6 27.4 4.9 100 1,486

West 27.9 7.2 56.7 8.2 100 1,042

West excluding California 38.8 6.3 47.7 7.2 100 481

California 18.5 8.0 64.4 9.1 100 560

U.S. 36.0 22.8 35.0 6.3 100 3,445

Note: Numbers may not add to totals due to rounding.

Page 39 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Appendix II 

Demographics of Medicaid-Eligible Children

Who Are Uninsured

Table II.3: Percentage of Uninsured Medicaid-Eligible Children in 1996, by Parents’ Birth Status and Region

Total

U.S-born child

and parent

U.S.-born child

with foreign-born

parent

Foreign-born

child and parent Percent

Number (in

thousands)

Northeast 59.6 30.1 10.2 100 437

Midwest 85.8 9.6 4.5 100 427

South 71.6 19.6 8.1 100 1,394

West 44.1 37.2 18.6 100 927

West excluding California 64.0 23.6 12.3 100 434

California 26.6 49.3 24.2 100 493

U.S. 63.8 24.8 11.0 100 3,185

Note: Table is based on 92 percent of uninsured Medicaid-eligible children whose records

matched with those of their parents. Numbers may not add to totals due to rounding.

Page 40 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Page 41 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Page 42 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Page 43 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
Related GAO Products

Medicaid: Early Implications of Welfare Reform for Beneficiaries and

States (GAO/HEHS-98-62, Feb. 24, 1998).

Health Insurance: Coverage Leads to Increased Health Care Access for

Children (GAO/HEHS-98-14, Nov. 24, 1997).

Uninsured Children and Immigration, 1995 (GAO/HEHS-97-126R, May 27, 1997).

Health Insurance for Children: Declines in Employment-Based Coverage

Leave Millions Uninsured; State and Private Programs Offer New

Approaches (GAO/T-HEHS-97-105, Apr. 8, 1997).

Employment-Based Health Insurance: Costs Increase and Family Coverage

Decreases (GAO/HEHS-97-35, Feb. 24, 1997).

Children’s Health Insurance, 1995 (GAO/HEHS-97-68R, Feb. 19, 1997).

Children’s Health Insurance Programs, 1996 (GAO/HEHS-97-40R, Dec. 3, 1996).

Private Health Insurance: Millions Relying on Individual Market Face Cost

and Coverage Trade-Offs (GAO/HEHS-97-8, Nov. 25, 1996).

Medicaid and Uninsured Children, 1994 (GAO/HEHS-96-174R, July 9, 1996).

Health Insurance for Children: Private Insurance Coverage Continues to

Deteriorate (GAO/HEHS-96-129, June 17, 1996).

Health Insurance for Children: State and Private Programs Create New

Strategies to Insure Children (GAO/HEHS-96-35, Jan. 18, 1996).

Health Insurance for Children: Many Remain Uninsured Despite Medicaid

Expansion (GAO/HEHS-95-175, July 19, 1995).

Medicaid: Spending Pressures Drive States Toward Program Reinvention

(GAO/HEHS-95-122, Apr. 4, 1995).

Medicaid: Restructuring Approaches Leave Many Questions

(GAO/HEHS-95-103, Apr. 4, 1995).

Health Care Reform: Potential Difficulties in Determining Eligibility for

Low-Income People (GAO/HEHS-94-176, July 11, 1994).

(101574) Page 44 GAO/HEHS-98-93 Outreach to Medicaid-Eligible Children
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