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The Effects of Premium Increases in SCHIP Programs: The Experience of Three States

The Effects of Premium Increases in SCHIP Programs: The Experience of Three States. Genevieve Kenney, The Urban Institute Andrew Allison, Kansas Health Institute Julia Costich, University of Kentucky Jim Marton, University of Kentucky Josh McFeeters, The Urban Institute June 25, 2005

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The Effects of Premium Increases in SCHIP Programs: The Experience of Three States

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  1. The Effects of Premium Increases in SCHIP Programs: The Experience of Three States Genevieve Kenney, The Urban Institute Andrew Allison, Kansas Health Institute Julia Costich, University of Kentucky Jim Marton, University of Kentucky Josh McFeeters, The Urban Institute June 25, 2005 Child Health Policy Research Meetings

  2. Two-Part Project Funded by the David and Lucile Packard Foundation 1) Examine effects of increases in public premiums on enrollment in public programs in three states How did enrollment patterns change following premium increases? To what extent did disenrollment patterns change following premium increases? Did effects appear to vary with income? 2) Examine effects of Premiums on Insurance Coverage Nationally

  3. Motivation • Between 2002 and 2004,16 states raised premium levels under SCHIP • Increased attention on cost sharing in Medicaid programs • Few studies have examined effects of premium increases in a rigorous manner, with controls for potentially confounding changes

  4. Background • 35 states expanded coverage with a separate non-Medicaid program • Cost sharing must be less than 5% of family income in separate programs • Cost sharing amounts cannot be higher for low-income families than they are for higher-income families • Premiums are rare in Medicaid programs for children

  5. Premium Policies in Three States, 2003

  6. Study Populations • Children ages 1 to 18 in New Hampshire’s Healthy Kids Silver program: 185-300% FPL; • Children ages 0 to 18 in Kentucky’s KCHIP III program: 151-200% FPL; • Children ages 0 to18 enrolled in Kansas’ HealthWave XXI program: 151-200% FPL; Study Period: July 2001 – November 2004

  7. Data • Monthly administrative caseload data in premium-paying categories; • Data linked over time at child-level to identify enrollment spells; • New enrollees defined as children in premium paying SCHIP in a given month, but not enrolled in premium-paying SCHIP (KS, NH)/any public coverage (KY) the prior mo.; • Disenrollees defined as children enrolled in premium-paying SCHIP for at least one month, but not enrolled in premium paying-SCHIP in the subsequent month;

  8. Methods • Contrast changes in caseload growth before and after premium increase; • Estimate multivariate time-series models of caseload and new enrollment (control for time trends, monthly dummies, address auto-correlation); • Estimate Cox Proportional Hazard models to assess changes in disenrollment patterns; • Use unemployment rate as control variable

  9. Figure 1. Total Caseload in the Premium-Paying Categories of Kansas' HealthWave XXI Program

  10. Figure 2. Total Caseload in the Premium-Paying Category of Kentucky's KCHIP Program

  11. Figure 3. Total Caseload in the Premium-Paying Categories of New Hampshire's Healthy Kids Silver Program

  12. Change in Growth Rates following Premium Increases 6 Months 6 Months Before After Kansas 151-175% FPL 13.53% 4.27% 176-200% FPL 8.64% 2.54% Kentucky 151-200% FPL -0.17% -17.44% New Hampshire 185-249% FPL 32.37% 7.52% 250-300% FPL 38.56% 6.84%

  13. Findings: Time-Series Models • All estimates point to negative effects of premium increases on premium-paying caseload, but magnitude and statistical significance vary substantially across models • Impact estimates sensitive to specification of time trends • Inclusion of county-level unemployment rate affected the estimated premium impact in one of the three states

  14. Findings: Hazard Models • No consistent effects for Kansas • Strong, consistent effects for Kentucky—hazard rate 1.4 times higher following introduction of premium • Small, variable effects for New Hampshire—hazard rate 1% to 10% higher following premium increase; larger effects found for lower-income than for higher-income group

  15. Magnitude: Hazard Models • After new premium in KY,1,522 kids per month left KCHIP III on average, compared to 1,087 kids before the new premium; • After premium increase in NH, 1,012 to 1,097 kids left Healthy Kids Silver compared to 999 before the premium increase;

  16. Policy Implications • Increases in premiums appear to reduce enrollment and increase disenrollment • Larger effects found with introduction of new premium and for lower-income children • Other premium policies may matter • Important to address possible spillover effects on non-premium paying caseload and impacts on insurance coverage

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