STATE HELPS CURE KIDS' HEALTH WOES FEWER CHILDREN GOING WITHOUT INSURANCE, UCLA STUDY FINDS.(News)(Statistical Data Included) - Daily News (Los Angeles, CA)

Byline: Harrison Sheppard Sacramento Bureau

SACRAMENTO - A state-funded program has sharply reduced the number of California children without health insurance even though far fewer children received coverage through their parents, a UCLA study to be released today found.

In all, there were 500,000 more children with insurance last year than in 2001 - an improvement that came even though 300,000 fewer children received insurance through their parents' employers. The decline in employer insurance was blamed on unemployment and rising costs of coverage.

The figures are being released as a coalition of health-care groups launches an effort today to provide coverage for all children in California.

``What this demonstrates is that the Medi-Cal and Healthy Families programs have really increased the coverage for these kids, and picked up a lot of the kids who have lost employment-based coverage,'' said report co-author E. Richard Brown, director of the UCLA Center for Health Policy Research.

But the expanded health coverage has also been expensive to state taxpayers.

For example, the budget of the Healthy Families program has increased from $390 million in fiscal 2000-01 to $872 million this year, a result of expanded eligibility rules, according to Jeanne Brode, a spokeswoman for the Managed Risk Medical Insurance Board, which oversees the program.

Healthy Families provides health insurance to children who are otherwise ineligible under Medi-Cal.

Enrollment in Healthy Families jumped from about 200,000 children in 2000 to almost 700,000 now, Brode said.

As a result, fewer children are going without health insurance, even as insurance provided by the private sector has decreased.

The number of children without insurance dropped from 1.5 million in 2001 to 1.1 million last year, according to the study. Accounting for an increase in total population under 18 during those years, the actual increase in children receiving insurance is nearly 500,000.

The number of children covered by their parents' employers dropped by 6.3 percent, to 5.1 million out of 10 million children in the state.

The number of children covered by state programs increased by 23.6 percent, to 2.94 million.

Health-care advocates argue that the state should encourage more private employers to provide coverage, relieving the state of its costs.

A recent ballot measure, Proposition 72, that would have required more employers to provide coverage, was narrowly defeated last month.

But a coalition called Californians for Healthy Kids plans to propose legislation in January to take a three-prong approach:

--Expand the eligibility for existing public programs.

--Create a public-private partnership to allow more employers to buy insurance for their employees' dependents.

--Overhaul the eligibility process so parents of eligible children are not discouraged by the confusing application process.

The changes would likely cost the state about $250 million to $300 million annually over the long run, plus some federal matching funds.

``We know this year and next year look particularly tough,'' said Catherine Teare, policy director at Children Now, a coalition member. ``That's why we're proposing a phased-in program, with no new funds needed in the first year and only modest amounts in later years.''

But fiscal conservatives are concerned that the state, still facing a budget crisis, cannot afford to provide more coverage, nor should it increase the burden on businesses when California is still facing criticism for being unfriendly to business.

Jon Coupal, president of the Howard Jarvis Taxpayers Association, said he is concerned that the state is not effective in preventing some parents from misusing the system by dropping their private insurance and enrolling in a public program.

``What we really want to prevent here is families who can afford insurance not providing it and simply relying on the state,'' Coupal said.

He would like to see a cap on public health insurance, and would like more individuals to pay for their own insurance.

Gov. Arnold Schwarzenegger remains concerned about the growth in public health insurance programs and is looking for ways to limit the growth in his next budget proposal, said H.D. Palmer, a spokesman for the Department of Finance.

Last year, Schwarzenegger proposed capping enrollment in Healthy Families, but later withdrew the plan after facing strong protests from Democrats and health care advocates.

``Health and human service programs have seen some of the fastest growth in spending over the past five or so years,'' Palmer said. ``The challenge is to control the rate of growth of those programs, while at the same time trying to ensure that to the greatest extent possible we can provide services to the most vulnerable populations in California.''

Harrison Sheppard, (916) 446-6723

harrison.sheppard(at)dailynews.com

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SOURCE: UCLA Center for Health Policy Research