CHILDREN’S HEALTH CARE WHY MORE INSURANCE WON’T SOLVE THE PROBLEM OF THE UNINSURED: Georganne Chapin, MPhil, JD Hudson Health Plan Hudson Center for Health Equity & Quality

Presentation Delivered at the Conference on the Uninsured & Underinsured W ashington, DC December 11, 2007 draft – for final copy contact

POPULAR POSITIONS – 2007  The uninsured population is growing  Something needs to be done  At the least, all children deserve coverage  More insurance is the answer

Sources of Insurance for Children Private coverage  As dependents of insured parents Public coverage  Medicaid  SCHIP

INSTABILITY OF PRIVATE INSURANCE FOR CHILDREN  Unstable parental employment  Rising co-premiums for employer coverage  Aging-out of employer-based plans

INSTABILITY OF PUBLIC INSURANCE FOR CHILDREN  All-or-nothing income limits  Lack of continuous coverage  Barriers to recertification  Administrative errors  Change in residence  “Churning”

PROBLEMS WITH INSURANCE  Temporary nature  Costs of underwriting  Administrative costs  Costs of regulation  Cost of churning  Adverse selection

INSURANCE IS TEMPORARY Limited eligibility periods Tension between policing the rolls (fraud phobia) and ensuring coverage & access

UNDERWRITING IS EXPENSIVE & REQUIRES:  Predicting costs of care  Paying costs of administration  Ensuring adequate reserves  Taxes  Ensuring profits/surpluses  Multiple layers of underwriting/risk-sharing

ADMINSTRATIVE COSTS … pervade the system Insurer level Provider level Government

CHURNING COSTS MONEY ACROSS THE SYSTEM  Costs to insurers  Costs to states/government  Costs to patients/families  Costs to providers  Pent-up demand/deferred care  Cost-shifting

Adverse Selection  Crowd-out rules  Co-premiums or “buy-in” plans  Selection bias caused by individual mandates  Other ….

EXPANDING EXISTING INSURANCE PROGRAMS WILL ONLY EXPAND EXISTING INSURANCE PROBLEMS

So … What do we do?

BIG IDEA: If we want to ensure that all children have health care, then……

Make health care available to all children

Children are a Low Risk Population Children’s Health Care is Mostly Predictable  Immunizations  Well-child screening & monitoring  URIs Children All Need Primary & Preventive Care

REINFORCE EXISTING PRIMARY CARE SYSTEM Fund additional capacity & facilities directly Establish permanent eligibility for all “children” <18? <21? <25?

 Use “medical home” model  Fund primary care providers based on assigned population  Establish integrated primary care model with electronic interfaces  Establish large risk pools for catastrophic events

Wrap-up Somebody (Winston Churchill?) once said: You can count on the Americans to get it right, but only after they’ve tried everything else. Georganne Chapin (914)