Facts, Health Coverage

Facts & Figures

Following years of progress to provide health coverage to more low-income children, the state has slid backwards on many of its improvements, due in large part to budget cuts and the recession. An estimated 1.5 million California children were uninsured for at least part of 2009—a 40% increase over the 1.1 million children who were uninsured for at least part of 2007.

Children are less likely to have health insurance in only nine other states aside from California.

Nearly eight in ten (79%) of California’s uninsured children are eligible for public health coverage of some kind; however, some local programs have waitlists.

During 2007-09, when 400,000 California children lost their health coverage, the rate of California children covered by their parents’ employer decreased from 52% to 47%.

Medi-Cal and Healthy Families are lifelines for California families. Together, these programs cover one in three (33%) California children. Without these programs, many more children would be uninsured.

The 2010-11 state budget cut county administration of Medi-Cal by $54.8 million. Specifically, the state budget agreement includes a $32.8 million cut, made worse by an additional $22 million cut as a result of Gov. Schwarzenegger’s line-item veto. Both cuts will have a substantial impact on county workforces.

In 2010, due to federal requirements, California repealed burdensome paperwork requirements for children in Medi-Cal – Mid-Year Status Reports (MSRs), which would have required the renewal of children’s Medi-Cal coverage every six months instead of annually. The repeal of MSRs ensures the continuation of annual renewals for children, which will help reduce gaps in coverage and prevent unnecessary administrative costs. In spite of record need, due to the economic downtown and parents losing employer-based health coverage, Healthy Families enrollment dropped from 922,429 to 869,127 (decreasing more than 53,000) between July 2009 and 2010, in the year following a temporary enrollment freeze.

SB 900 (Alquist and Steinberg) and AB 1602 (Pérez) were signed into law to establish the California Health Benefit Exchange, a key feature of the Patient Protection and Affordable Care Act (ACA). This new health insurance marketplace is designed to provide uninsured, and in some cases under-insured, individuals and small businesses access to affordable health coverage.

When the newly created California Health Benefit Exchange becomes operational in 2014, an estimated 2.4 to 3.5 million Californians, including nearly one million children, will be eligible for federal subsidies through the Exchange, equal to an estimated value of about $13.8 billion. An additional 3.8 million small business employees and their dependents will also be eligible for coverage through the Exchange.

AB 2244 (Feuer), enacted in September 2010, aligns state law with the ACA by prohibiting insurance companies from denying children coverage or treatments based on “pre-existing conditions.”

SB 1088 (Price), enacted in September 2010, aligns state law with the ACA by requiring insurance companies to allow young adults to stay on their parents’ insurance as dependents until age 26.

AB 2470 (De La Torre), enacted in September 2010, aligns state law with the ACA by prohibiting insurance companies from dropping coverage when a person becomes sick (a common practice called “rescission”).

AB 1825 (De La Torre), which would have phased in maternity coverage as a basic benefit and aligned with the ACA requirement that all new health plans sold to individuals and small businesses cover maternity and newborn care beginning in 2014, was vetoed by Gov. Schwarzenegger.

In California, Medi-Cal eligibility income thresholds vary depending on the age of the child. The ACA simplifies this eligibility system by expanding eligibility to U.S. citizens of all ages under 138% of the federal poverty level (roughly $30,000 per year for a family of four) by 2014.

Since 2002, employer-sponsored health insurance premiums in California have risen by 118%. In 2009, the average employer-sponsored family plan in California cost $13,525, with families paying about $3,398 (25%) of the premium.

In California, the average cost to cover a child in Medi-Cal is $1,445 per year. Only two states (Louisiana and Wisconsin) pay less per child in their Medicaid programs. The cost is shared by federal and state governments.

The Healthy Families Program, California’s Children’s Health Insurance Program (CHIP), provides health coverage at an average cost of $1,250 per year per child, and the cost is shared by federal and state governments, as well as by family contributions. For every $1 the state invests in Healthy Families, the federal government contributes roughly $2.

Since February 2009, Healthy Families enrollees have seen their premiums increase by either 60% or 78%, depending on their annual income. Co-pays for certain services and prescriptions have also increased by 200% to 300%.

For children between the ages of three and 21, preventive medical examinations are recommended once per year. Only 87% of California children receive a preventive medical visit each year, similar to the 89% national rate. Of those children, only 78% have an overall health status of “very good” or “excellent,” compared to 84% nationally. Uninsured children (76%) and children, ages 12-17, (78%) are least likely to receive preventive care.

Only 50% of California children have health coverage that meets all components of a health home: a primary care model that is accessible, continuous, comprehensive, family-centered, coordinated, compassionate and culturally effective. Nationally, 58% of children have a health home. Children are less likely to have a health home in only two other states (Nevada and New Mexico).

The ACA provides new opportunities for states to enhance access to care. For example, Medicaid demonstration projects will develop models to better deliver and effectively coordinate care for children. This law also allows pediatric medical providers to join together to form Accountable Care Organizations (ACOs), which would be held accountable for the cost and quality of care delivered to children. If designed properly, ACOs could provide many important features of a health home.

Early and Periodic Screening, Diagnosis and Treatment (EPSDT) is a Medi-Cal benefit to help children maintain their physical and mental well-being. In 2007, California’s EPSDT participation rate was 43%, besting only Arkansas (25%), Wyoming (38%) and Mississippi (42%).