February 2018 | Issue Brief How Do Medicaid/CHIP Children with Special Health Care Needs Differ from Those with Private Insurance? MaryBeth Musumeci and Julia Foutz Key Findings Medicaid and CHIP covered about half (48%) of all children with special health care needs in 2016. Medicaid/CHIP is the sole source of coverage for 41% of these children, and another 7% have Medicaid/CHIP to supplement their private coverage. Medicaid plays a key role for children with special health care needs by making coverage affordable and covering services that private insurance typically does not. This issue brief compares key characteristics of Medicaid/CHIP children with special health care needs to those with private insurance only and those who are uninsured. For example:  Medicaid/CHIP children with special health care needs are significantly more likely to live in low income families compared to those with private insurance only. Nearly eight in 10 (78%) Medicaid/CHIP-only children with special health care needs, and nearly six in 10 (57%) of those with both Medicaid/CHIP and private insurance, live in families with incomes below 200% of the federal poverty level (less than $41,560/year for a family of three in 2018), compared to less than two in 10 (17%) of those with private insurance only.  Medicaid/CHIP children with special health care needs are significantly more likely to have multiple health conditions and to be in poorer health compared to those with private insurance alone, with children with both Medicaid/CHIP and private insurance having the greatest needs. For example, children with special health care needs with both Medicaid/CHIP and private insurance are more than twice as likely (55%), and those with Medicaid/CHIP only are nearly twice as likely (43%), to have four or more functional difficulties compared to those with private insurance alone (24%).  Medicaid/CHIP children with special health care needs are more likely to report that their coverage is affordable compared to those with private insurance alone. For example, those with Medicaid/CHIP only are more than four times as likely (82%), and those with both Medicaid/CHIP and private insurance are more than twice as likely (43%), to report that their out-of-pocket health care costs are always reasonable compared to those with private insurance alone (19%). Over half (53%) families of Medicaid/CHIP-only children with special health care needs, and over a third (36%) of those with both Medicaid/CHIP and private insurance, find it somewhat or very often hard to cover basic needs like housing or food since their child’s birth compared to a fifth (20%) of those with private insurance only. Introduction Medicaid and CHIP cover about half (48%, or about Figure 1 6.8 million) of children with special health care needs Health insurance status of children with special health care in the U.S. as of 2016 (Figure 1). Box 1 below 1 needs, 2016. Medicaid/CHIP Unspecified Uninsured describes children with special health care needs. and Private 2% 4% Insurance Medicaid or CHIP is the sole source of coverage for 41 7% percent of these children. Another seven percent Total have Medicaid/CHIP to supplement private Medicaid/ CHIP Private Insurance 48% Only insurance. Medicaid provides a wide range of medical Medicaid/CHIP 47% Only and long-term care services, many of which are not 41% covered at all or only available in limited amounts Total = 14.2 million children with through private insurance, and makes coverage special health care needs affordable for many children with special health care NOTES: Includes non-institutionalized children ages 0-17. Totals may not sum to 100% due to rounding. needs and their families. SOURCE: Kaiser Family Foundation analysis of the 2016 National Survey of Children’s Health, Topical File. This issue brief compares the demographics, health status, access to care, and coverage affordability of Medicaid/CHIP children with special health care needs to those with private insurance and those who are uninsured. Medicaid plays a key role for children with special health care needs by making coverage affordable and covering services that private coverage typically does not. Consequently, legislative proposals that would cap and reduce federal Medicaid funding may pose a particular risk to children with special health care needs and their providers. While Congress did not pass such legislation in 2017, these proposals may resurface in 2018, and the Trump Administration’s FY 2019 proposed budget continues to advance these proposals. A companion brief describes Medicaid’s role for children with special health care needs. Box 1: Who Are Children with Special Health Care Needs? As defined by the U.S. Department of Health and Social Services, children with special health care needs “have or are at increased risk for chronic physical, developmental, behavioral or emotional conditions and also require health and related services of a type or amount beyond that required by children generally.”2 Their needs arise from a range of conditions such as autism, Down syndrome, and other intellectual and developmental disabilities; physical disabilities such as cerebral palsy, spina bifida, and muscular dystrophy; mental health needs such as depression and anxiety; and complications arising from premature birth. They may need nursing care to live safely at home with a tracheotomy or feeding tube; attendant care to develop community living skills; medical equipment and supplies; mental health counseling; and/or regular physical, occupational, speech or other therapies to address developmental delays. They may have difficulty with bodily functions, such as breathing, swallowing, or chronic pain; difficulty with daily activities such as self-care, mobility, learning, or communicating; and/or emotional or behavioral difficulties, such as anxiety, depression, or difficulty making friends. How Do Medicaid/CHIP Children with Special Health Care Needs Differ from Those with Private Insurance? 2 Socio-Demographics Children with special health care needs who have Medicaid/CHIP are significantly more likely to live in low income families, below 200% of the federal poverty level, compared to those with private insurance only. Nearly eight in 10 (78%) Medicaid/CHIP-only children with special health care needs live in families with incomes below 200% of the Figure 2 federal poverty level (FPL, less than $41,560/year for Household income of children with special health care needs by a family of three in 2018), compared to 17% of those coverage status, 2016. with private insurance only. Nearly six in 10 (57%) of 5% 400% FPL+ 16%* 12%* children with special health care needs who have both 16% 14% 200-399% FPL Medicaid/CHIP and private insurance live in a family 49%* 27%* 100-199% FPL 32% 0-99% FPL with income below 200% FPL. Medicaid/CHIP 26% children with special health care needs are about 10 35% 34%* times less likely, and those with both Medicaid/CHIP 46% 49% and private insurance are about three times less 11%* 22%* likely, than those with private insurance only to live in 6%* Private Insurance Medicaid/CHIP Only Medicaid/CHIP and Uninsured a family with income of 400% FPL or higher Only Private Insurance NOTES: Includes non-institutionalized children with special health care needs ages 0-17. ($83,120/year for a family of three in 2018, 5% vs. *Indicates statistically significant difference from the Medicaid/CHIP Only population at the p < 0.05 level. SOURCE: Kaiser Family Foundation analysis of the 2016 National Survey of Children’s Health, Topical File. 16% vs. 49%) (Figure 2). Medicaid/CHIP-only children with special Figure 3 Race/ethnicity of children with special health care needs by coverage health care needs are significantly more likely status, 2016. to be a member of a racial or ethnic minority 9% 9% 8% Non-Hispanic group compared to those with private 14%* 12% Other Race Hispanic 21%* insurance only, while over half (53%) of those 8%* 31% 32% Non-Hispanic Black with both Medicaid/CHIP and private 18% Non-Hispanic White insurance are non-Hispanic white. Nearly 22% 24% seven in 10 (68%) children with special health care 68%* 53%* needs with private insurance alone are non-Hispanic 38% 32% white compared to less than four in 10 (38%) Medicaid/CHIP children with special health care Private Insurance Only Medicaid/CHIP Only Medicaid/CHIP and Private Insurance Uninsured needs (Figure 3). NOTES: Includes non-institutionalized children with special health care needs ages 0-17. *Indicates statistically significant difference from the Medicaid/CHIP Only population at the p < 0.05 level. SOURCE: Kaiser Family Foundation analysis of the 2016 National Survey of Children’s Health, Topical File. Health Status Medicaid/CHIP children with special health care needs are significantly more likely to have multiple chronic conditions and to be in fair or poor health compared to those with private insurance only. Close to four in 10 (37%) Medicaid/CHIP-only children with special health care needs have four or more chronic conditions, compared to less than a quarter (23%) of those with private insurance only. Over half (51%) of those with both Medicaid/CHIP and private insurance have four or more chronic conditions. Some of the chronic conditions reported by children with special health care needs include autism, intellectual disability, asthma, depression, anxiety, attention deficient hyperactivity disorder, cerebral palsy, cystic fibrosis, diabetes, muscular dystrophy, brain injury, heart conditions, and epilepsy. Medicaid/CHIP-only children with special health care needs are three times as likely (9%), and those with both Medicaid/CHIP and private How Do Medicaid/CHIP Children with Special Health Care Needs Differ from Those with Private Insurance? 3 insurance are four times as likely (12%), to be in fair or poor health compared to those with private insurance alone (3%) (Figure 4). Figure 4 Figure 5 Health status of children with special health care needs by coverage Health needs of children with special health care needs by coverage status, 2016. status, 2016. Private Insurance Only Medicaid/CHIP Only Medicaid/CHIP and Private Insurance Uninsured Private Insurance Only Medicaid/CHIP Only Medicaid/CHIP and Private Insurance Uninsured Share of children reporting: Share of children reporting: 55%* 51%* 43% 38% 35% 33% 37% 30% 31% 29% 25% 24%* 23%* 17%* 18% 18%* 12% 9% 3%* N/A 3+ service needs 4+ functional difficulties Health conditions usually or 4+ current chronic conditions Health fair or poor always affect daily activities somewhat or a great deal NOTES: Includes non-institutionalized children with special health care needs ages 0-17. N/A: Estimates do not meet minimum standards for reliability. NOTES: Includes non-institutionalized children with special health care needs ages 0-17. *Indicates statistically significant difference from the Medicaid/CHIP Only population at the p < 0.05 level. *Indicates statistically significant difference from the Medicaid/CHIP Only population at the p < 0.05 level. SOURCE: Kaiser Family Foundation analysis of the 2016 National Survey of Children’s Health, Topical File. SOURCE: Kaiser Family Foundation analysis of the 2016 National Survey of Children’s Health, Topical File. As a result of their poorer health, Medicaid/CHIP children are significantly more likely to have multiple health care service needs during the course of a year and to have their daily activities affected by their health compared to those with private insurance only. Medicaid/CHIP-only children with special health care needs are significantly more likely (25%) to require three or more health care services, such as specialist care; prescription medication; speech, occupational, or behavioral therapy; or mental health treatment or counseling, compared to those with private insurance alone (17%). Medicaid/CHIP-only children with special health care needs are nearly twice as likely (43%) to have four or more functional difficulties compared to those with private insurance alone (24%). Over half (55%) of those with both Medicaid/CHIP and private insurance have four or more functional difficulties. Functional difficulties experienced by children with special health care needs include problems with bodily functions, such as breathing, swallowing, or chronic physical pain; activities or participation, such as self-care, mobility, learning, or communicating; and emotional or behavioral factors, such as anxiety, depression, or making friends. Medicaid/CHIP-only children with special health care needs are significantly more likely (31%) to have health conditions that usually or always affect their daily activities somewhat or a great deal compared to those private insurance only (18%) (Figure 5). As a result of their greater health needs and functional limitations, Medicaid/CHIP children with special health care needs are significantly more likely to have their education impacted by their health status. Those with Medicaid/CHIP only (30%) are significantly more likely to have a current How Do Medicaid/CHIP Children with Special Health Care Needs Differ from Those with Private Insurance? 4 special education plan compared to those with private Figure 6 Educational impact on children with special health care needs by insurance alone (24%). Medicaid/CHIP-only children coverage status, 2016. with special health care needs also are significantly Private Insurance Only Medicaid/CHIP Only Medicaid/CHIP and Private Insurance Uninsured more likely (13%) to miss more than two weeks (11 or Share of children reporting: more days) of school due to illness or injury compared to those with private insurance alone (7%) (Figure 6). 43%* 30% ACCESS TO CARE 24%* 20%* 18% 13% 12% 7%* Despite their greater needs, Medicaid/CHIP- Currently has a special education plan Missed 11 or more days of school in past 12 only children with special health care needs months due to illness or injury (ages 6-17) NOTES: Includes non-institutionalized children ages 0-17. are significantly more likely than those with *Indicates statistically significant difference from the Medicaid/Other Public Only population at the p < 0.05 level. SOURCE: Kaiser Family Foundation analysis of the 2016 National Survey of Children’s Health, Topical File. private insurance alone to report that their coverage meets their needs. For example, Figure 7 Medicaid/CHIP-only children with special health care Insurance adequacy among children with special health care needs by coverage status, 2016. needs (87%) are significantly more likely than those with private insurance only (56%) to report that their Private Insurance Only Medicaid/CHIP Only Medicaid/CHIP and Private Insurance Share of children reporting: coverage is adequate. Two-thirds (66%) of children 87% with both Medicaid/CHIP and private insurance 71%* 77% 66%* 68%* 64% report that their coverage is adequate, perhaps due to 56%* 50%* this group’s greater health needs. Medicaid/CHIP- 41%* only children with special health care needs also are significantly more likely to report that their insurance always allows them to see all needed health care Current insurance is adequate Current insurance always Current insurance always allows child to see needed meets child's mental or providers, compare to those with private insurance NOTES: Includes non-institutionalized children ages 0-17. health providers behavioral needs *Indicates statistically significant difference from the Medicaid/CHIP Only population at the p < 0.05 level. alone (77% vs. 71%). While access to mental health SOURCE: Kaiser Family Foundation analysis of the 2016 National Survey of Children’s Health, Topical File. services can be challenging across payers due to Figure 8 provider shortages, Medicaid/CHIP-only children Access to care children with special health care needs by with special health care needs (64%) are significantly coverage status, 2016. more likely to report that their insurance always Private Insurance Only Medicaid/CHIP Only Medicaid/CHIP and Private Insurance Uninsured Share of children reporting: meets their mental or behavioral needs compared to 97%* 92% 96%* 94%* 89%* 91%* 86% those with private insurance alone (41%) (Figure 7). 78% 80% 77%* 75%* 67%* Medicaid/CHIP children with special health care needs have high rates of access to care; their access is not as high as those with private insurance alone but significantly Usual source of care when sick Usual source of preventive At least one preventive visit in better than those who are uninsured. Nearly care the last 12 months NOTES: Includes non-institutionalized children with special health care needs ages 0-17. Emergency room is excluded from usual source of care. four in five (78%) Medicaid/CHIP-only children with *Indicates statistically significant difference from the Medicaid/Other Public Only population at the p < 0.05 level. SOURCE: Kaiser Family Foundation analysis of the 2016 National Survey of Children’s Health, Topical File. special health care needs report a usual source of care when sick compared to 89% of those with private insurance alone. The rates for access to a usual source of preventive care (92% for Medicaid/CHIP-only vs. 97% for private insurance only) and for at least one preventive visit in the last year (86% for Medicaid/CHIP-only vs. 91% for private insurance only) are high for How Do Medicaid/CHIP Children with Special Health Care Needs Differ from Those with Private Insurance? 5 both groups. Medicaid/CHIP children with special health care needs also experience significantly better access to care on these measures compared with those who are uninsured (Figure 8). AFFORDABILITY Medicaid/CHIP children with special health care needs are significantly more likely to report that their coverage is affordable compared to Figure 9 Affordability for children with special health care needs by coverage those with private insurance alone. status, 2016. Medicaid/CHIP-only children with special health care Private Insurance Only Medicaid/CHIP Only Medicaid/CHIP and Private Insurance needs (82%) are more than four times as likely to Share of children reporting: 82% report that their out-of-pocket health care costs are always reasonable compared to those with private 53% insurance alone (19%). Over four in 10 (43%) of those 43%* 36%* 36%* with both Medicaid/CHIP and private insurance 19%* 20%* 14%* report that their out-of-pocket costs are always 3% reasonable. Medicaid/CHIP-only children are more Out-of-pocket costs are always Families paid $1000 or more in Somewhat or very often find it reasonable out-of-pocket medical expenses hard to cover basic needs since than 12 times less likely (3%) to incur annual out-of- child born pocket costs of $1,000 or more, compared to those NOTES: Includes non-institutionalized children with special health care needs ages 0-17. *Indicates statistically significant difference from the Medicaid/Other Public Only population at the p < 0.05 level. SOURCE: Kaiser Family Foundation analysis of the 2016 National Survey of Children’s Health, Topical File. with private insurance alone (36%) (Figure 9). Insurance affordability may be a particular concern for families of Medicaid/CHIP children with special health care needs because they are significantly more likely to have difficulty covering basic household needs compared to those with private insurance only. Families of Medicaid/CHIP-only children with special health care needs are more than two and a half times as likely (53%) to find it somewhat or very often hard to cover basic needs like housing or food since their child’s birth compared to those with private insurance alone (20%) (Figure 9). For an example of how Medicaid helps make private coverage affordable for children with special health care needs, see Gabriel’s story in Box 2 below. How Do Medicaid/CHIP Children with Special Health Care Needs Differ from Those with Private Insurance? 6 Box 2: Gabriel, age 4, Louisiana Gabriel was born prematurely at 27 weeks and spent a little over his first year of life in the hospital. When he was ready for discharge, his parents were told that he would have to go to a nursing home because the services that he needed to be safely cared for at home were not offered by his private insurance through his father’s job as a tugboat pilot. Medicaid covers these services, and because Gabriel qualified based on the extent of his health care needs, he was able to come home. Although Gabriel has significant developmental delays and chronic lung diseases, his mother, Jessica, says he is “thriving at home.” Jessica attributes Gabriel’s progress to the Medicaid services he receives to care for his tracheotomy and gastrostomy tube and monitor his oxygen supply and ventilator. Gabriel requires close attention because he can decompensate quickly, and Jessica credits his Medicaid home nursing services with helping him stay as healthy as possible – he has only been hospitalized for illness once since his discharge. He plays outside with the support of his direct care workers, and Medicaid provided a generator that enabled him to remain at home during recent flooding and power outages instead of going to a shelter or hospital. Jessica says the private insurance copayments for all of Gabriel’s care would be “outrageous” without Medicaid. Medicaid helps with medical supplies, prescriptions, visits with seven specialists and a pediatrician, and eight outpatient occupational and speech therapy sessions per month. Medicaid also supplements Gabriel’s special education services, which, for example, do not address feeding issues. Jessica studied social work in college and says she was used to helping connect others with resources but never thought that she would be “on the other end of needing support” herself. She believes that Medicaid helps Gabriel to “reach his maximum potential” and maintain his quality of life. Insurance affordability also is important because the demands of caring for children with special health care needs can impede their families’ ability to work, an outcome that is significantly more likely among Medicaid/CHIP children with special health care needs compared to those with private insurance only. Medicaid/CHIP-only children with special health care needs are nearly twice as likely (18%) to live in families who had to reduce their work hours or stop working due to their child’s health needs, compared to those with private insurance alone (10%). Over one-quarter (27%) of those with both Medicaid/CHIP and private insurance live in families who had to reduce their work hours or stop working due to their child’s health needs (Figure 10). How Do Medicaid/CHIP Children with Special Health Care Needs Differ from Those with Private Insurance? 7 Families of Medicaid/CHIP children with special health care needs may be less able to work because they are significantly more likely to devote time to meeting their child’s health needs compared to those with private insurance Figure 10 only. They are three times as likely (12%) to have Impact on family’s ability to work among children with special health care needs by coverage status, 2016. family members who spend five or more hours per week providing their health care at home, and those Private Insurance Medicaid/CHIP Only Medicaid/CHIP and Private Insurance Uninsured with both Medicaid/CHIP and private insurance are Share of children reporting: over four times as likely, compared to those with private insurance alone (4%). Medicaid/CHIP-only children with special health care needs are three 27%* times as likely (3%) to have family members devoting 10%* 18% 12% 18% N/A 4%* N/A 1%* 3% 5% N/A five or more hours per week coordinating their health Reduce work hours or stop Spend 5 or more hours/week Spend 5 or more hours/week care, and those with both Medicaid/CHIP and private working due to child's health providing child's health care at home coordinating child's health care insurance are five times as likely, compared to those NOTES: Includes non-institutionalized children with special health care needs ages 0-17. N/A: Estimates do not meet minimum standards for reliability. *Indicates statistically significant difference from the Medicaid/Other Public Only population at the p < 0.05 level. with private insurance alone (1%) (Figure 10). SOURCE: Kaiser Family Foundation analysis of the 2016 National Survey of Children’s Health, Topical File. Conclusion Medicaid/CHIP children with special health care needs experience greater health needs, comparable access to care, and greater affordability compared to those with private insurance alone. Their families are more likely to have to limit their work hours or stop working as a result of their health and more likely to devote time providing or coordinating their health care. In addition to filling gaps in private insurance and making coverage affordable, Medicaid is the sole source of coverage for many children with special health care needs in low and middle income families. Medicaid also fills in the gaps in private insurance and makes coverage affordable for children with some of the greatest health care needs. Medicaid/CHIP children with special health care needs experience significantly better access to care on these measures compared with those who are uninsured. Proposals to cap and reduce federal Medicaid funding may pose a particular risk to children with special health care needs because these children use services more intensively, and often incur greater costs, compared to other children. While Congress did not pass such legislation in 2017, these proposals may resurface in 2018, and the Trump Administration’s FY 2019 proposed budget continues to advance these proposals. Families of children with special health care needs, their providers, states, and other stakeholders may want to consider the implications of these proposals, given the important role that Medicaid plays for children with special health care needs. How Do Medicaid/CHIP Children with Special Health Care Needs Differ from Those with Private Insurance? 8 Endnotes 1 An estimated 14.2 million children, or 19% of all children in the U.S., have special health care needs, as of 2016. Kaiser Family Foundation analysis of the 2016 National Survey of Children’s Health, Topical File. 2 U.S. Dep’t of Health & Human Services, Health Resources & Services Administration, Maternal & Child Health, Children with Special Health Care Needs (Dec. 2016), https://mchb.hrsa.gov/maternal-child-health-topics/children-and-youth-special-health-needs#ref1. The Henry J. Kaiser Family Foundation Headquarters: 2400 Sand Hill Road, Menlo Park, CA 94025 | Phone 650-854-9400 Washington Offices and Barbara Jordan Conference Center: 1330 G Street, NW, Washington, DC 20005 | Phone 202-347-5270 www.kff.org | Email Alerts: kff.org/email | facebook.com/KaiserFamilyFoundation | twitter.com/KaiserFamFound Filling the need for trusted information on national health issues, the Kaiser Family Foundation is a nonprofit organization based in Menlo Park, California.