Are they frustrated? Overwhelmed? No. They just don’t need coverage

As the State Children’s Health Insurance Program (CHIP) matures, many states are turning their attention from recruitment to retention, looking for ways to ease the paperwork burden for consumers and remove barriers to enrollment and renewal.

Then along comes the National Academy for State Health Policy (NASHP) in Portland, ME, with news that many people who don’t re-enroll in CHIP drop out because they no longer need the coverage, not because they are frustrated or overwhelmed.

Using data from a telephone survey of 3,780 parents in Alabama, Arizona, California, Georgia, Iowa, New Jersey, and Utah, NASHP found that more than two-thirds of parents interviewed had discontinued their families’ participation in CHIP because they no longer were eligible for the coverage. Most of those parents said they had found private insurance coverage or thought their children no longer were eligible.

NASHP executive director Trish Riley tells State Health Watch the finding contradicts state records indicating the majority of children with lapsed coverage are the result of failure to complete renewal forms or pay premiums.

An overwhelming majority of the parents surveyed rated CHIP as an excellent or very good program that they valued because it is affordable, comprehensive, and provides high quality. More than 80% of lapsed families said they would want their children back in the program.

"CHIP is a program that works," Ms. Riley says. "Children who would otherwise be uninsured are receiving needed health care services, and parents appreciate the security that CHIP provides for their families."

Ms. Riley says the study is the first and most comprehensive look at disenrollment factors and the conventional wisdom about where people go and why.

"What we’re seeing is that CHIP is a transition program, a bridge to private coverage, and that’s a good thing," she says. "It’s not something people will stay on for years and years. Most of those who leave the program are doing so for appropriate reasons — because they have obtained private coverage, because the child has gotten too old for coverage, or because they have moved to a new location."

Focusing resources

Using this information, Ms. Riley says, states will be able to focus their resources on the small subset of parents who leave for reasons that are not appropriate from a public policy standpoint, the ones who fail to pay their premiums or fail to complete necessary paperwork.

"People don’t tell the states why they leave the program," she says. "But now that subset that is having problems can be identified."

The survey results indicate that 84% of current enrollees and 68% of lapsed families perceive the CHIP annual renewal process to be about "as easy as possible." Only 15% of current enrollees said the process was much more or somewhat more difficult than it needed to be. However, about twice as many lapsed families (31%) rated the renewal process as much more or somewhat more difficult than necessary.

For example, most parents said renewal forms were fairly simple, but a few found them problematic. A common concern about renewal was that the required background information could be difficult to obtain. The study’s focus groups suggested that parents in atypical work situations have more trouble with CHIP’s income-verification requirements. Income verification is especially challenging for people who change jobs frequently or are self-employed. Farmers and seasonal workers in the focus groups said they had a hard time providing income information because they do not receive a regular paycheck and their income varies widely from month to month.

Another problem: Some parents say they were not told they needed to renew their coverage. About 70% of current enrollees were more likely to say that they were told about renewal, while only 50% of lapsed parents said they were told. NASHP says that while information about renewal often is in the program materials parents receive when their children are enrolled, it is unclear if parents pay attention to the requirement at that time.

A strong majority of both current enrollees (90%) and lapsed families (83%) said they felt the CHIP premium amounts were reasonable. Even among lapsed families with premiums higher than $20 per month, 75% felt their premium payment was reasonable. A majority of current enrollees and lapsed families said that paying the premium was worth it for the peace of mind they received by having coverage. There also was widespread agreement that the premium amount was justified by the care and coverage available through CHIP.

But some focus group parents said that while paying the monthly premium usually was not a problem, it could become overwhelming if they had unexpected expenses. This was particularly true of lapsed families. In the survey results, 17% had trouble paying their children’s premium at least every couple of months, and 38% experienced some problems paying premiums. Lapsed families that paid more than $20 per month in premium were more likely to have trouble than those who paid $20 or less.

One issue that states will have to continue to address is helping parents understand the value of insurance and the value of purchasing it when it doesn’t appear to be needed. A few parents in the focus groups questioned whether it was worthwhile to be enrolled in CHIP since their children are healthy. That feeling also was expressed in the survey, with 10% saying they sometimes feel that paying the premium is a waste of money. Lapsed families were more likely to feel that way (21%), which could help explain why they allowed CHIP enrollment to lapse.

Forgetting to renew

In another finding, families that lapsed because they did not complete the renewal process are most likely to say they forgot or did not get around to it. Some parents also identified communications problems with CHIP as reasons why they did not renew. The survey gives evidence of problems and frustrations experienced by some parents, particularly in lapsed families, when interacting with CHIP. Some 18% of current enrollees said they had to wait weeks or months to hear back from CHIP about enrollment or some other issue. That number jumps to 32% in lapsed families. Similarly, 12% of current enrollees had trouble getting questions answered, but 22% of lapsed families reported this problem. Lapsed families also are likely to perceive that they have been given incorrect information about CHIP or to have had their children removed from the program without being told why.

NASHP says the survey findings offer insights for all states that want to improve retention in CHIP and reduce the number of lapsed families. Recommendations include:

• Follow up with lapsed families by giving parents a convenient way such as a postage-paid postcard to report changes in status. Another way is to follow up with telephone calls to discover why people have left the program and to determine if they are still eligible for CHIP or other programs.

• Educate families about the renewal process. Families either are not being told about the process or are ignoring what they are told. Better and more strategic kinds of information to explain the renewal process would likely help retain eligible families.

• Enhance communication pathways between CHIP and enrolled families. Parents, particularly in lapsed families, point out a number of communication problems with CHIP, and the findings suggest that quicker and clearer responses from CHIP and fuller explanations to families about why they are experiencing problems could help families stay enrolled.

• Make allowances for families’ fluid economic and personal lives. The researchers say that in most cases, CHIP already is flexible enough to accommodate many shifts in families’ personal and financial lives, such as adjusting premiums to reflect a lower income, but families aren’t aware of their options. In other cases, they say, there may not be enough program flexibility to allow families to miss a couple of premium payments but remain enrolled.

• Provide additional training and support for CHIP staff. Additional training could help the staff’s ability to troubleshoot and keep eligible families who are enrolled in the program.

In Iowa, according to Anita Smith, chief of the Bureau of Insurance in the Department of Human Services in Des Moines, a change in program contractors led to data problems that hampered analysis.

"We were pleased to find that a higher percentage of families than we thought were leaving for good reasons and not because of administrative problems," Ms. Smith tells State Health Watch. "We see that we need to rethink the nature of CHIP. It may be that families are not going to be on it long term."

Ms. Smith says the agency is addressing preventable reasons that were identified for families lapsing in coverage. "We’re trying to remind people in several different ways that if their income decreases, they may no longer have to pay a premium. That information is being included in correspondence and on the premium payment coupons." In addition, Iowa puts a message on the Month 10 payment coupon to remind the family to submit a renewal form.

She says they are redesigning their notices to make them more attractive and readable for families and are stressing the availability of a customer service center that can respond to telephoned questions.

Chad Westover, Utah’s director of CHIP in Salt Lake City, tells SHW that during the study period, Utah did not charge a premium. But now that the state has had to institute a premium because of financial pressures, it is learning from experiences of other states in the study and trying to avoid their problems.

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"We realize that as people drop from the program for nonpayment of premium it is not sufficient to assume that they either don’t have the money or don’t want to pay," he says. "We’ve started surveying disenrollees to find out why, to get underneath the initial layer of data. The study also is helping us understand why people sometimes don’t want to pay their premium. We’re trying to be more accurate in our data because it’s the data that drive policy decisions."

Mr. Westover says the agency is sending additional notices for payments, past-due payments, and warnings that coverage is about to end. There also are telephone follow-ups. "Making the contacts takes time and effort and resources," he says, "but the study demonstrates the value of doing the work."

[Contact Ms. Riley at (207) 874-6524, Ms. Smith at (515) 281-8791, and Mr. Westover at (801) 538-6982.]