Enrollment in Medicaid and CHIP, the Children’s Health Insurance Program, among children whose parents work full time and earn more than 100 percent of the federal poverty level grew significantly between 2008 and 2016, according to a new study by researchers at the Children’s Hospital of Philadelphia published this month in Health Affairs.
Researchers found the growth was largely driven by families working for large private employers, where health insurance is a standard benefit — but an increasingly unaffordable one.
Employer-sponsored health insurance is still the most common type of health plan for adults under 65 and their children. But employees are spending more and more out of pocket as their wages remain stagnant.
As companies are strained by rising health-care costs, they are shifting more of the burden to their employees. Across the country, employees’ average share of a premium for family coverage increased 57 percent between 2008 and 2016, to $5,277, according to the Kaiser Family Foundation. Deductibles rose from $1,344 to $2,147 for a family during that period.
A study by the Commonwealth Fund found that nearly 24 million people with employer health plans spend at least 10 percent of their income on premiums, out-of-pocket costs, or both.
Meanwhile, Medicaid offers low-cost coverage and possibly more comprehensive benefits for eligible families who are finding that they can’t afford their employer health coverage, said David Rubin, director of PolicyLab at Children’s Hospital of Philadelphia and a co-author of the Health Affairs study.
“This is a bellwether for the affordability crisis for families in health care right now,” said Rubin, a pediatrician.
Using data from the Medical Expenditure Panel Survey, researchers found that child enrollment in Medicaid and CHIP increased across all income levels and employer types between 2008 and 2016.
Low-income parents working for small, private firms were the most likely to enroll their children in Medicaid or CHIP and also saw significant enrollment growth. About 53 percent of children from these families were enrolled in public coverage in 2008, compared with 79 percent in 2016.
Among moderate-income families working for small firms, Medicaid and CHIP enrollment increased from 21 percent in 2008 to 64 percent in 2016.
But there was notable growth in enrollment among families whose parents work for large private firms, too. Enrollment among low-income families working for large firms increased from 45 percent to 69 percent.
The data set researchers used does not indicate why parents enrolled their children in public coverage, but the study’s authors link the rise in Medicaid and CHIP enrollment to increasingly expensive employer coverage.
Medicaid and CHIP have consistently been more common among children of parents who work for small firms because small companies are less likely to be able to support the cost of family health insurance for their workers.
Researchers were more surprised to see growth in public insurance enrollment among families employed by large companies, which are expected to offer comprehensive health insurance, Rubin said.
“These are our largest employers, who should have the benefit of being able to average that risk off a larger employee pool. Their plans are no longer affordable,” he said.
Medicaid enrollment is growing as many states consider cuts to Medicaid spending — a confluence of circumstances that Rubin worries could lead to more children being uninsured.
“It’s not a hard stretch to imagine: If we make a big move on the availability of Medicaid for children, what we’re looking at is potentially dramatically impacting the availability of health care for children. It’s kind of like a perfect storm,” he said.