This paper describes the experiences of nine states that developed health insurance programs to serve children without insurance coverage, prior to passage of Title XXI (See Table 1). It is based on qualitative data collected from representatives of the following states: California, Colorado, Florida, Massachusetts, Minnesota, New York, Pennsylvania, Tennessee, and Washington. Criteria used to select the programs examined for this report include: program type (e.g., Medicaid expansion, state-sponsored, or foundation-sponsored), geographic location, length of program existence, and scope of the program. State representatives, including children's health program directors, Maternal and Child Health department directors, and Medicaid program staff from all nine states were interviewed on their experiences in determining benefit packages and implementing cost-sharing requirements.
The collection of information on state benefit packages and cost-sharing arrangements was guided by the following questions:
- What services are included in the benefit package?
- How was the benefit package determined?
- Has the benefit package changed over time? Why?
- How does the benefit package compare to that offered by Medicaid or by private insurance?
- What was the basis for instituting cost-sharing arrangements?
- What are the cost-sharing arrangements in your program?
- Are copayments used for any services? Which services? Other cost-sharing arrangements?
- Are copayments set by income, or do all participants pay the same amount?
- What was the role of copayments in determining whether certain benefits would be?
- How did you set premiums for this program?
- Has the cost-sharing level (i.e., family contribution towards the premium) changed for any income group since the program began? Why?
- If cost-sharing has changed over time, how has this affected participation among the various income groups?
- Is any information available on the cost-sharing levels needed to reach certain participation levels within particular income groups?
The nine states interviewed for this study are divided into two broad categories: Medicaid expansion programs and stand-alone insurance programs. This section provides an overview of these programs followed by a more detailed discussion of the states experiences in designing benefits and cost sharing arrangements for their programs. The information collected through interviews and a review of written materials and data provided by the nine selected states is presented as follows. Section I provides a brief overview of the nine state programs. Section II examines the issues states considered in designing a benefit package, including: defining their objectives; benefits that were debated by the states; considerations related to narrowing the scope of the benefit package as a means of limiting substitution; and the impact of benefit package design on children with special health care needs. Section III examines state experiences with cost-sharing, including: the rationale for setting premiums and copayments; issues related to price sensitivity; decisions regarding use of flat or a sliding-scale premiums; other decisions related to premiums and copayments; and administrative concerns. Section IV summarizes the major issues the nine states faced when designing benefits and cost-sharing and identifies gaps in available data