Healthcare Business News

Coverage push could miss some kids: GAO

By Rich Daly
Posted: July 23, 2012 - 5:30 pm ET

The 2010 federal healthcare overhaul could extend health insurance coverage to about 5.3 million uncovered children but leave 1.7 million uncovered, according to the Government Accountability Office (PDF).

The projections, which were released Monday by the nonpartisan investigative arm of Congress, were based on 2009 data and requested by senior Senate Democrats. The accuracy of the estimates is highly dependent on future actions by the states and the Internal Revenue Service. For instance, the report found that 3.4 million of the newly insured would gain coverage in 2014 through the law's expansion of Medicaid eligibility to all members of families with incomes of up 133% of the federal poverty level, including a 5% leeway to 138%. But most governors have announced they are either undecided or opposed to that expansion since the U.S. Supreme Court eliminated penalties for states that do not expand.

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Other uninsured children would gain coverage, according to the GAO report, from the Children's Health Insurance Program (1.4 million) or through subsidies for policies sold on health insurance exchanges (0.53 million) set to launch in 2014.

The uninsured children expected to continue lacking coverage include noncitizens (0.88 million); those who meet IRS standards as having access to affordable employer-based coverage (0.46 million); and those in families whose income was more than 400% of the federal poverty level (0.38 million).

The IRS' proposed affordability standard, which defined affordability for an employee's eligible family members based on the cost of their employer's employee-only plan, is among the variables that has drawn controversy, the report noted.

“Some commenters raised concerns that IRS's interpretation was inconsistent with PPACA's goal of increasing access to affordable health insurance as it does not consider the higher cost of family insurance and could result in some children remaining uninsured,” the report's authors wrote.

Another variable that could affect the accuracy of the projections is that CHIP funding expires in 2015 and states are allowed to reduce CHIP eligibility or eliminate programs beginning in fiscal 2020.

“Without CHIP-funded Medicaid expansion or separate CHIP programs, we estimate that an additional 1.9 million children who would otherwise be eligible for CHIP would be considered to have access to affordable insurance under this proposed standard and would be ineligible for the premium tax credit,” the report authors noted.

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