A new United Hospital Fund report examines New York's Child Health Plus program, whose federal funding was recently extended, but only until September 2017. Nearly 280,000 children in New York currently rely on the program for health insurance coverage, but the federal funding prospects beyond 2017 are unknown, and New York policymakers face decisions about the program's future regardless.
The report, What's Next for New York's Child Health Plus Program? notes that the program, though small, is popular throughout the state. Covering about 6 percent of New York's children, Child Health Plus (CHP) is available primarily to children whose families earn too much for Medicaid, with subsidies for families earning up to 400 percent of the federal poverty level, the highest eligibility level in the nation. (For a family of four, 400 percent of the federal poverty level would be $97,000.) Subsidized sliding scale premiums range from $0 to $60 per month, and there are no copayments or deductibles. State officials have already said that at least a year's lead time would be required to prepare for a loss of federal matching funds, were the federal program to sunset.
With an eye to a possible sunset in 2017, the report clarifies decisions policymakers might face during the next funding cycle and compares key features of CHP to alternative sources of coverage, such as employer-based coverage or qualified health plans on New York's health insurance exchange. Although many features of these options are similar to CHP, the report notes that most families would experience significant increases in cost sharing and premiums if they sought coverage for children in the absence of CHP.
“Congress's decision to extend children's health funding for two more years gives New York policymakers an important window,” said Peter Newell, director of the Fund's Health Insurance Project and a co-author of the report. “While it's unclear what 2017 will bring, at least now policymakers have a chance not only to plan for contingencies like funding cutbacks or eligibility changes, but also to think about how CHP fits in to the new ACA coverage landscape, which includes new sources of subsidized coverage for children and families.”
The report shows that, without CHP, costs for many families seeking coverage for children would increase dramatically in New York. For example, families eligible for the deepest level of subsidies on the State's health insurance exchange would face a $63 monthly premium for the second-lowest silver plan instead of their free CHP coverage. Moreover, for the same family, cost sharing would go from $0 to up to $1,000 annually. Other families would face even more extreme cost increases.
The report also notes potential benefits of integrating CHP with new coverage options available under the Affordable Care Act, perhaps using CHP funding to supplement premiums and cost sharing. With a single policy covering the whole family instead of separate coverage for adults and children, families could pay a single premium to one health plan, and it would be easier to establish relationships with provider groups that know and treat the whole family. Also, if CHP enrollees were instead pooled with families enrolled in insurance plans through the State's health insurance exchange, the experience of the larger pools would be improved from an actuarial perspective, and overall premium rates would likely be reduced.
“The CHP program has a long history in New York, in fact, predating the federal program,” said Jim Tallon, president of the Fund. “New York State is enjoying a historically low rate of uninsurance, thanks in large part to the success of the state's health insurance exchange, but it also reflects the rich range of insurance options available to New Yorkers. CHP has been an important option, and its future warrants thoughtful consideration.”
What's Next for New York's Child Health Plus Program? written by Peter Newell and Nikhita Thaper, research assistant, is available on the Fund's website, www.uhfnyc.org. The project was supported by the New York Community Trust.
About the United Hospital Fund: The United Hospital Fund is a health services research and philanthropic organization whose primary mission is to shape positive change in health care for the people of New York.