Private sector health insurance for children is on the decline

Snapshot for August 20, 2003.

Private sector health insurance for children is on the decline;
state children's health insurance program picks up the slack

New findings from the Urban Institute show that private sector health insurance coverage for children decreased between 1999 and 2002. Fortunately, expansion of Medicaid eligibility and the State Children’s Health Insurance Program (SCHIP) has more than offset the shrinkage. However, the Bush Administration’s budget reorganization for 2004 threatens to reduce funding to these organizations in the long term.

The pie charts below show how health insurance coverage was distributed among children in low-income families. In 2002, these 29 million children in families with incomes of less than double the poverty level represented 37% of all children in the United States.

In 1999, employers covered 39% of such children, Medicaid and SCHIP covered 35%, and 23% (about seven million children) had no health insurance coverage. By 2002, employer coverage and the number of uninsured had both decreased, while Medicaid and SCHIP coverage increased to 48% (about 14 million children in low-income families).

The State Children’s Health Insurance Program was inaugurated in 1997. By 2003, federal grants to the states for SCHIP totaled more than $4 billion. In 2002, more almost 23 million children were enrolled in Medicaid and SCHIP.

The federal budget for fiscal year 2004 proposed by President Bush this past February introduced a restructuring of Medicaid and SCHIP that would reduce SCHIP outlays in 2004 by 44% (Historical Statistics, Budget of the U.S. Government, Table 12.3, p. 268). Between 2004 and 2013, the overall change for Medicaid and SCHIP recommended by the Bush Administration is a cut of $2.4 billion (Budget of the U.S. Government, p. 127).

Source: Kenney, Genevieve, Jennifer Haley, and Alexandra Tebay, “Children’s Insurance Coverage and Service Use Improve,”
Snapshots3 of America’s Families , The Urban Institute,
http://www.urban.org/Template.cfm?NavMenuID=24&template=/TaggedContent/ViewPublication.cfm&PublicationID=8496;
Federal Budget of the U.S. Government, Fiscal Year 2004, http://www.whitehouse.gov/omb/budget/fy2004/hhs.html;
Historical Statistics, Budget of the U.S. Government, http://www.whitehouse.gov/omb/budget/fy2004/pdf/hist.pdf.

This week's Snapshot was written by EPI economist Max Sawicky.

Check out the archive for past Economic Snapshots.