For two years newspapers, lawmakers and promoters of government spending have relentlessly criticized the state budget and policy decisions passed last session that were made to balance a state budget without increasing taxes.
Critics point to two policies, in particular, in the Children’s Health Insurance Program that stepped up the state’s enforcement of eligibility guidelines and misleadingly allege that these policies keep eligible children out of the program.
The two policies make sense: the use of an assets test to check eligibility, and the requirement that families re-enroll every six months – both measures ensure the state directs funds to Texans most in need, and reduces fraud. These policies did not change eligibility; they merely enforced the eligibility guidelines already in place.
With the state budget headed to negotiation between the House and the Senate, the criticisms continue as newspaper columnists, liberal activists and left-leaning lawmakers call for wasting millions by undoing these important policies.
Last session the legislature asked Medicaid and CHIP recipients to prove that they remain eligible for the programs every six months, rather than once a year. More frequent verification helps to ensure that anyone receiving taxpayer-funded health insurance is truly eligible for the program. After all, the programs are intended to be a short term safety net, and much can change in a year that would impact eligibility: people have children, children have birthdays, people get jobs, lose jobs, and income and assets change.
While critics have painted the re-enrollment process as a hardship and a hassle that drives eligible people away, a survey of families disenrolled from the CHIP program found that 93 percent of the families agreed that “CHIP has made the renewal forms easy to fill out.” The same survey also found the most frequently reported reason that a family did not complete the renewal process was that they “forgot or did not get around to the paperwork.” This requires a reasonable measure of personal responsibility, asking recipients of a rich and virtually free benefit to complete an easy re-enrollment process.
In addition, the last legislature implemented an assets test for CHIP to ensure that the program is truly a safety net and not simply a taxpayer-funded alternative to private insurance. The assets test is hardly draconian, if you are footing the bill.
So who has the assets test kept out of the program? According to a report released last December, the assets test denied families, such as: – a single parent and one child with three vehicles totaling $50,000 in value after the allowable deductions,- a family of four with a monthly income of more than $5,000 and 3 IRA accounts totaling around $158,713.00, though they initially reported their monthly income at $1,550. –
The assets test also denied families who falsely reported a lower monthly income, just to appear to be eligible for CHIP, as well as re-enrollment to families owning vehicles like a 2003 or 2004 Lexus, a 2004 Cadillac and other new SUVs and pickup trucks. These families have the resources to help themselves but would instead defraud the state and its taxpayers in order to receive CHIP benefits.
While opponents have described the assets test as mean, the truth is that the policies simply protect the program from being used by those who are not eligible.
Ironically, even lawmakers advocating for relaxed eligibility determination expressed concern that the state might need to institute a waiting list for CHIP services if funds for the program run out. There is no better way to ensure eligible children receive CHIP benefits than to prevent ineligible children from taking their place to begin with.
The state can play an important role as a safety net for the truly needy while responsibly managing tax dollars. Lawmakers should be applauded for resisting pressure to reverse these policies and spend wastefully in a futile attempt to make critics happy.
Mary Katherine Stout is the health care policy analyst for the Texas Public Policy Foundation, an Austin-based research institute.