California spent more than $100 million between 2001 and 2003 to reprocess Medicaid-eligible children who were dropped because of paperwork problems, only to be re-enrolled a short time later, according to a report by the California Endowment. The report found that 18%, or more than 600,000 of the state's Medicaid-eligible children, were disenrolled at least once during the three-year period and then re-enrolled, most within four months.
This process, commonly known as "churning," costs the state about $180 per child in administrative costs -- funds the report's author concluded could otherwise be spent directly on coverage for uninsured children. The churning was largely the result of untimely or incomplete paperwork. "This study shows definitively that burdensome enrollment processes not only deprive California's kids of badly needed health insurance but also costs the state millions of dollars each year," said Robert Ross, the endowment's president and chief executive officer. Nearly 3.4 million children are enrolled in Medi-Cal, the state's version of Medicaid. View the full report.