Studies have shown that insured children are more likely than uninsured children to get preventive and primary health care. 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 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. 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. 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. 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. The law tightened the criteria for children to qualify for disability assistance through SSI, thus tightening eligibility for Medicaid. 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. 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.) 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. 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 Medicaid programs to reach additional low-income children, increasing the number of children potentially eligible for Medicaid. 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. 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. 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. 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.) 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. 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.) 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. (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. 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 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. 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 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.) 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 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. 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. 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 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. 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. 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 States. 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. 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. 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. State officials, beneficiary advocates, providers, and other experts agree that Medicaid enrollment processes and requirements have often been 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. 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. 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. 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. 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 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 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. 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 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. 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. 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. Advertisements and fliers for these programs emphasize that they are for a broad population, not just those on welfare. MassHealth fliers state, “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.) 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. 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 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. 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. 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. 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 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. 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. 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. Children can have multiple sources of health insurance coverage in the same year. The CPS asks about all sources of health insurance coverage. It 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. 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. 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 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. 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. Either parent worked full-time, full year. Neither parent worked full-time, full year, but at least one worked full-time part of the year. Neither parent worked full-time, but at least one parent worked part-time for the entire year. Neither parent worked either full-time or full year, but at least one parent worked part-time for part of the year. 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 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. 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. 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 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. 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. Number (in millions) 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 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). 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 Number (in thousands) Percentage enrolled Number (in thousands) 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). The first copy of each GAO report and testimony is free. Additional copies are $2 each. Orders should be sent to the following address, accompanied by a check or money order made out to the Superintendent of Documents, when necessary. VISA and MasterCard credit cards are accepted, also. Orders for 100 or more copies to be mailed to a single address are discounted 25 percent. U.S. General Accounting Office P.O. 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Summary: Pursuant to a congressional request, GAO reported on children who are eligible for Medicaid but are not enrolled, focusing on: (1) the demographic and socioeconomic characteristics of children who qualify for Medicaid, and identifying groups in which uninsured children are concentrated and to whom outreach efforts might be expected; (2) the reasons these children are not enrolled in Medicaid; and (3) strategies that states and communities are using to increase employment. GAO noted that: (1) the demographic and socioeconomic characteristics of uninsured Medicaid-eligible children suggest that outreach strategies could be targeted to specific groups; (2) in 1996, 3.4 million Medicaid-eligible children--23 percent of those eligible under the federal mandate--were uninsured; (3) the majority were children of working poor or near poor, and their parents were often employed by small firms and were themselves uninsured; (4) 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; (5) state officials, beneficiary advocates, and health care providers whom GAO contacted cited several reasons that families do not enroll their children in Medicaid; (6) 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; (7) under welfare reform, the delinking of Medicaid and cash assistance may cause some confusion for families, although GAO found that states were making efforts to retain a single application and eligibility determination process to avoid this problem; (8) in addition, many low-income families believe that Medicaid carries the same negative image of dependency that they attach to welfare; (9) 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; (10) 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; (11) 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 necessary information; (12) these efforts include mass media campaigns and coordination of effort with community organizations and provider groups; (13) some states have made the enrollment process more accessible for working families, using mail-in applications or enrollment at sites chosen for their convenience; (14) several states have changed the name of the program to minimize its identification with welfare and other assistance programs; (15) many states provide Spanish-language applications and some are working with community groups; and (16) some states have also simplified the enrollment procedure by shortening the enrollment form and reducing the documentation requirements.