When Children Lose Employer-based Health Insurance Coverage

Suk-fong S Tang, Jean C Davis. ¹Practice and Research, American Academy of Pediatrics, Elk Grove Village, IL, United States.

 

Background: When employer-based health insurance coverage ends, workers have several options to continue coverage for their children (e.g., COBRA, individually purchased private insurance, new employer coverage, and Medicaid or SCHIP for poor and low-income families). Research shows, however, that few workers purchase COBRA due to high cost, while the extent to which they access other insurance or regain employer coverage has not been studied. As employer-based health insurance continues to decline, understanding the implications of losing that coverage will be increasingly important for protecting children's access to care.

 

Objective: This study assesses the rate at which children a) enter or exit employer-based coverage during a 2-year period, and b) regain employer-based or other coverage or remain uninsured in a 12-month period after employer-based insurance ends.

 

Design/Methods:� 18,192 unweighted cases, representing the non-institutionalized US child population through age 18 between 1996 and 2001, were obtained from the Medical Expenditure Panel Survey. Monthly health insurance data were used to track a) entry into and exit from employer coverage by all children for 24 months, and b) coverage changes for 12 months after children lost employer coverage.

 

Results:� Two-thirds of US children had employer-based health insurance during a 24 month window. Among them, 3/4 had employer-coverage full-time, while 1/4 entered and/or exited employer coverage once or more. Among 3 million children losing employer coverage during the first 12 months of the study, 75%, or 2.2M, became uninsured in the following month. Of the 2.2M, 41% remained uninsured throughout the following 12 months, while 43% regained employer coverage, and 13% enrolled in Medicaid or SCHIP. Of the 25% who stayed insured in the month after they lost employer coverage, most did so by maintaining Medicaid coverage they had prior to employer coverage termination or through COBRA and other private coverage.

 

Conclusions:� When children lose employer-based health insurance most experience coverage gaps, many of which last at least a year. Despite COBRA legislation, Medicaid and SCHIP, children of working parents are at risk of becoming uninsured upon termination of employer coverage. Policy makers should consider strategies to help parents access COBRA, Medicaid and SCHIP when they lose employer coverage to ensure continuous coverage for as many children as possible.