93,000 fewer kids enrolled in Medicaid and CHIP under Corbett

For years, the Philadelphia region has been among the best places for a child to get sick.

Pennsylvania's Children's Health Insurance Program, dating to 1992, was a model for what Congress expanded to all the states five years later. New Jersey set one of the easiest income thresholds for SCHIP and has aggressively enrolled children into Medicaid as well.

New Jersey still has a top reputation, with more than 25,000 children added to the public insurance rolls since July 1, 2011. It has won more than $50 million in federal "bonus" grants for its performance.

There have been no bonuses for Pennsylvania. Since Gov. Corbett's first budget took effect in mid-2011, enrollment has dropped by 93,000.

Children's advocates are now awaiting the outcome of a meeting Tuesday between Corbett and Kathleen Sebelius, U.S. secretary of health and human services, to discuss why the governor rejected the federal health-care overhaul's expansion of Medicaid for low-income adults and, perhaps, conditions that would change his mind.

The expansion, which the Supreme Court made optional for the states, does not directly affect children. When parents are insured, however, their offspring are more likely to get coverage. If Corbett declines the expansion that Christie has accepted, health experts say, still more Pennsylvania children may go without insurance even as more gain coverage in New Jersey.

Obama's health-care overhaul split the nation, particularly over mandatory coverage for adults. Views on children are more accepting and the vast majority are covered, here and elsewhere.

"You have a case with kids, the nice version of a perfect storm, where regardless of political persuasion, people can get behind coverage of kids, and we can do everything possible to get them covered," said Ian Hill, a senior fellow at the Urban Institute in Washington who has followed SCHIP for years.

"I would be surprised if coverage overall" - Medicaid for the poorest children and CHIP for others - "was dropping for kids," Hill said. But that is exactly what has occurred in Pennsylvania.

Medicaid is by far the bigger program, and most of the loss occurred there. Between August 2011 and January 2012, as state workers complied with orders to reduce a huge backlog of mandatory case reviews, enrollment of children dropped more than 88,000.

Officials said at the time that most were ineligible. Higher incomes, however, would have automatically switched them into the CHIP program, whose numbers did not rise.

Asked again last week, Anne Bale, a spokeswoman for the Department of Public Welfare, supplied a chart that "is intended to show you exactly why the families moved off of, or were rejected from, the Medical Assistance program." The chart shows a sudden jump in cases closed due to Code 42: Failure to Furnish Required Information.

Children's advocates say that code confirmed their suspicions about what happened, as workers rushed to get through the piles.

"There was just so much paperwork that was required that some paperwork that was submitted to welfare offices simply never got to caseworkers," said George L. Hoover, a former director of Medicaid eligibility and CHIP under Democratic and Republican governors, who retired in 2008. He heads health policy at Pennsylvania Partnerships for Children, an advocacy group.

Medicaid enrollment has been largely stable since the decline leveled off more than a year ago - but CHIP fell 6,000, much of it in the last few months.

The Corbett administration "has callous disregard of what's going on with kids," said Colleen McCauley, health-policy director for the advocacy group Public Citizens for Children and Youth. She said the state had made little effort to raise enrollment and had recently stopped sending 30-day renewal notices (the third of three letters, after 90 and 60 days) before expiration.

Rosanne Placey, a spokeswoman for the state Insurance Department, which runs CHIP, said that the letter was dropped "to better streamline the process and make it more timely" and that renewal rates had not declined; they were still about 65 percent. (New Jersey's top 80 percent.)

The decrease in enrollment, she said, was likely due to marketing cuts that began near the end of the Rendell administration and continued through Corbett's first two budgets, with no money for TV advertising, which had the biggest impact.

"After two years of fiscal constraint, Gov. Corbett felt the state could make some responsible spending increases," she said. His proposed budget adds $8.5 million to CHIP, including about $1 million for marketing, with a goal of enrolling 9,300 additional children. Still, she said, there are no funds for TV.

New Jersey doesn't market SCHIP on television. In 2008, in response to a new state law that sought to increase coverage - one year after a Pennsylvania law with some similar goals - various state agencies began looking at how they could help.

As a result, state income tax returns now ask what kind of insurance you have - and if your children aren't covered, the division follows up with the appropriate program based on your income. Hospitals now cannot collect state money for charity care unless they have enrolled an eligible child in Medicaid or SCHIP. Renewals for SCHIP are "passive" - state workers check income databases in advance and, if nothing has changed, send a preformatted form that a parent just signs and returns.

"All this stuff has been incrementally chipping away at uninsured kids," said Mary Coogan, assistant director of Advocates for Children of New Jersey, who chaired the task force that recommended many of the changes.

In 2011, when the Kaiser Family Foundation examined states' policies and procedures that ease enrollment, New Jersey was the only state that scored five out of five. Pennsylvania had one.

Those practices have earned New Jersey nearly $52 million in performance bonus awards from Washington over the four years they have been available. If Pennsylvania, with its far bigger CHIP population, had made these changes, it would have been eligible for more than $100 million in fiscal 2011 alone, said Tricia Brooks, a policy expert at Georgetown University's Center for Children and Families.

Indeed, she said, Pennsylvania seems to be falling behind in all three areas - policies, procedures, and outreach - on which she judges states. "A huge red flag is when you lose enrollment," she said, referring to the Medicaid declines in fall 2011, "and you suggest that you didn't do anything to make it happen, and you're not doing anything to fix it."