July 6, 2009: A Healthcare Solution for Families in Need, By Jeanne Ryer, Program Director for Reducing Economic Barriers to Health at the Endowment for Health

For more than a decade, the Children۪s Health Insurance Program has helped states bring children under the umbrella of health insurance coverage, assuring their families that health care would not strain a household budget with choices between food or medicine, a preventive visit or part of the rent money.

Earlier this year, after a prolonged legislative battle, the Children۪s Health Insurance Program was reauthorized. The health system that protects kids and helps provide economic stability for families in need was assured for several more years.

Advocates for kids and families breathed a collective sigh of relief, but have little time to rest on their laurels. The CHIP Reauthorization challenges us to fulfill and build on the original promise to create a system that protects everyone in our families from the economic disruption that even a small episode of ill health can create.

Without health coverage, an asthma attack in the middle of night or a broken arm from a fall off a bike can push a poor or working family۪s budget past the breaking point. Assuring children۪s health coverage has become especially important as job loss, reduced hours and insurance cuts eliminate the option of employer health insurance for many families.

Now, the original CHIP will continue intact with added elements that challenge states to smooth the processes for families to apply to and remain in the program. States can also elect to cover pregnant women a cost-effective way to protect the health of the newest generation and to cover legal immigrant children and pregnant women. Including mental health parity and requiring oral health care has helped assure that CHIP covers the whole child.

In each of these provisions, states must maintain consistent coverage for kids and thus assure economic stability for their families. By improving retention, extending coverage and growing enrollments to cover more eligible kids, states that meet the new CHIP challenges will see larger payments from the federal government.

But the biggest payoff for states is in healthier kids, ready to learn and with parents who can work and manage their family budgets without sudden, financially destabilizing expenses. However, the benefits of health coverage are not just a one-way street. Research in California shows financial savings from preventable hospitalizations alone might offset the costs of children۪s health insurance by as much as nine percent.

The health system works better when everyone is covered for consistent and preventive carenot just parachuting in for emergencies or chronic conditions gone out of control. We all benefit from reductions in costs by cutting down on unnecessary care or preventable conditions.

There is an even greater challenge implicit in the CHIP reauthorization: if we can cover kids, if we know it works and we know why we should, then can۪t we get everyone covered? Everyone in the family not just the kids needs affordable health coverage that assures needed care. Medical bills are devastating impoverished families and are now contributing to more than 60% of family bankruptcies, even for those with insuranceplunging families who had assets into financial instability. Loss of job-related health insurance has left families struggling to pay medical costs, and even the insured are seeing stagnant wages and painful increases in their cost sharing.

The facts are clear: kids and their families do better in so many ways when they have health coverage. Good health is linked to economic stability and vice versa. The health system itself works better when it is a system that covers the whole person, the whole child, and covers everyone consistently.

CHIP has shown us that good health coverage for kids pays off in better health, more stability for families and reduced costs to the system. And CHIP has shown us that, as a country, we know how to make something like this work, and we can.

Jeanne Ryer is Program Director for Reducing Economic Barriers to Health at the Endowment for Health, a statewide health foundation in Concord, New Hampshire.