Children's Health Insurance Patterns: A Review of the Literature. C. PARTICIPATION RATES IN OTHER PUBLIC ASSISTANCE PROGRAMS


In this section, we examine the participation rates in other public assistance programs as a point of comparison to the Medicaid participation rates presented above. Specifically, we present estimates of participation rates for the Aid to Families with Dependent Children (AFDC) program and the Food Stamp Program (FSP). Comparisons of AFDC and FSP participation rates are not exactly comparable to Medicaid participation rates because one can be participating in Medicaid without actually receiving services, where as participants in AFDC and the FSP all currently receive benefits.

Ruggles and Michel (1987) estimated AFDC household participation rates for 1973 through 1984 using CPS data and The Urban Institute's TRIM2 microsimulation model, which adjusts for underreporting of AFDC participation in the CPS. During those years, they found that the participation rate ranged from 75 percent to 83 percent.

Stavrianos (1997), using SIPP data and the MATH® SIPP microsimulation model, which adjusts for the underreporting of FSP participation in the SIPP, found that the household participation rate for the FSP declined from 59 percent to 56 percent between 1985 and 1988 and then rose to 69 percent in 1992 and 1994. Stavrianos noted that in order to understand participation rate trends, it is necessary to examine the trends in eligibility and participation -- the two component parts of the participation rate. For example, the decline in the participation rate from 1985 to 1988 was largely due to legislative changes authorized by the 1985 Food Security Act. Although the act substantially increased the number of eligible households, most of the newly eligible households did not participate initially. Therefore, even though the number of FSP participants remained steady from 1985 to 1988, the participation rate fell.

Most of the Medicaid participation rates cited above are lower than the estimated participation rates in the AFDC and Food Stamp programs. Devaney, Ellwood, and Love (1997) cite four reasons that Medicaid may have a low participation rate. First, they note that there is a general lack of awareness that children can now qualify for Medicaid even if both parents are present in the home or one parent is working full time. Second, the time-consuming, sometimes difficult application process is an obstacle to many people. Third, families may not apply for Medicaid because of its stigma as a welfare program. Fourth, because most children are healthy, their parents may not feel there is a compelling reason for them to apply for Medicaid.(6) One additional reason that Medicaid may have a low participation rate is that the uninsured may have access to free care, either from physicians who choose not to deal with the Medicaid program, or from free clinics.