Examining Substitution: State Strategies to Limit "Crowd Out" in the Era of Children's Health Insurance Expansions. Colorado Children's Health Plan



The Colorado Child Health Plan (CCHP) was established in 1992 as a community-based health care reimbursement program for low-income children. CCHP operates as a health maintenance organization that is administered by the University of Colorado Health Sciences Center. The program initially targeted rural counties with a low number of safety net providers, and built its own network of physicians. Recent legislation established the Children’s Basic Health Plan (CBHP), a program which will expand eligibility under CCHP up to age 18 and extend the network into every county in the state. CBHP will be a full benefit program administered by private HMOs. The CBHP will be funded in part by the Title XXI block grant. The Colorado Child Health Plan will provide the basic infrastructure for the establishment of the Children’s Basic Health Plan which will be implemented in March 1998. The Colorado Child Health Plan will sunset on June 30, 1998.


The target population of CCHP is children age 18 and under with incomes up to 185% of the poverty level who are not eligible for Medicaid. Enrollment in FY1996 was 4,893 children. In FY1997 the target is 6,217 children, and in FY1998 the target enrollment in the CCHP/CBHP is estimated to be 14,000 children.


The benefit package was modeled after the Blue Cross/Blue Shield Caring Programs. Benefits include most preventive services such as well child care, immunizations, laboratory tests, visits for illness and injury, chronic care and outpatient surgery; but do not include inpatient hospital care, eyeglasses, hearing aids or dental care. There is a maximum annual benefit of $10,000 per child. The program expansion will include inpatient and mental health care.


CCHP is administered by the state of Colorado through the University of Colorado Health Sciences Center. The program has a statewide network of pediatric physicians. Primary care physicians are reimbursed on a capitated basis and bear risk. Medical specialists are reimbursed on a fee-for-service basis.


Funding is obtained for CCHP through a combination of state appropriations and private donations. Funding comes from several sources: General Fund; intergovernmental transfer cash reserves and interest paid on those reserves; private donations; and enrollment fees. The enrollment fee is a $25 per child yearly payment in lieu of premium contributions. Co-payments are required on doctor visits, health screenings, and prescriptions. Blue Cross/Blue Shield HMO donates all claims processing services