CHP+ Premiums Will Result In More Uninsured Kids

An editorial in the Denver Post today discusses the possible ramifications of Colorado Senate Bill 213, which passed it’s third reading in the House last month.  The editorial was written by people who definitely have experience when it comes to children and health care:  Chris Watney, the president and CEO of the Colorado Children’s Campaign;  Len Dryer, the CFO for The Children’s Hospital; and Dr. Steve Federico, president of the Colorado Chapter of the American Academy of Pediatrics.

Chris, Len, and Steve note that SB213 would likely result in more uninsured Colorado children, since a monthly premium – even a small one – acts as a barrier to enrollment.  They remind readers that Colorado has tried this before:  in the late 90s, there was a monthly premium for CHP+, but it was abolished a decade ago.  The editorial also points out that implementing a monthly premium would increase the administrative costs associated with CHP+.  I’m sure this is true, although presumably the revenue generated from the premiums would be more than the cost associated with collecting them.

SB213 would not implement an enrollment fee for families with incomes up to 150% of the federal poverty level, or for pregnant women.  For a family of four, that’s $33, 525/year.  For families that earn more than 150% of FPL, but less than 205%, an annual enrollment fee would be charged for CHP+ coverage, although I didn’t see any specific amounts for this fee listed in the bill (the annual enrollment fee is currently $25 for one child, and $35 for two or more children).  For families that earn more than 205% of FPL ($45,817/year for a family of four), the monthly premium would be at least $20 for the first child enrolled in CHP+ and at least $10 for each additional child.  But there would be a cap of $50/family/month, regardless of how many children were enrolled.  The monthly premium system would take effect on July 1, 2011.

I can see both sides of this debate.  A total of not more than $50/month to insure all the children in a family is quite a bargain when compared with coverage through a standard group plan or individual policy.  Our own family has a high deductible, HSA qualified policy (what people often refer to as “catastrophic” coverage), and the cost to cover our two children on that plan is roughly $250/month.  On a group policy, dependent coverage is even more expensive (although some employers pay a portion of the dependents’ premiums).  Given the level of coverage provided by CHP+, $20 to $50/month is a very low premium.  And many people would say that a family of four earning $45k+ should be able to pay up to $600/year for their children’s health insurance.

However, the real world is not always ideal.  The Post editorial makes some very good points, and I don’t doubt that if CPH+ moves to a monthly premium system this summer, there will be some kids who lose their coverage, and fewer children will enroll in the future compared with how many would have enrolled if monthly premiums were not part of the deal.

I understand the need for Colorado to balance the budget.  And funding public programs takes money – money which is in short supply right now.  It appears that SB213 has a lot of support.  It will help to offset the money the state spends to provide health insurance to children on CHP+, and most people tend to be in favor of legislation that requires people to contribute a little of their own money in exchange for publicly-funded services.  But people should also be aware of the points that the Post editorial makes, and understand that while SB213 will help to generate funds for CHP+, it will also almost certainly result in some Colorado kids losing their health insurance.  That may be an unavoidable consequence, but it’s a consequence that shouldn’t be brushed off lightly.

About Louise Norris

Louise Norris has been writing about health insurance and healthcare reform since 2006. In addition to the Colorado Health Insurance Insider, she also writes for healthinsurance.org, medicareresources.org, Verywell, Spark by ADP, and Boost by ADP, and Gusto. Follow on twitter and facebook.

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