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Response to health insurance by previously uninsured rural children
J M Tilford1, J M Robbins, S J Shema
1Center for Applied Research and Evaluation (CARE), Department of Pediatrics, University of Arkansas for Medical Sciences/Arkansas Children's Hospital, Little Rock 72205, USA.
Insights
This study found no evidence of pent-up demand for healthcare among previously uninsured rural children. Providing limited insurance benefits proved cost-effective, suggesting lower premiums are possible for programs like the State Children's Health Insurance Program.
Area of Science:
- Health Services Research
- Public Health Policy
- Pediatric Healthcare
Background:
- Many rural children lack health insurance, impacting their access to care.
- Understanding healthcare utilization patterns is crucial for designing effective insurance programs.
- The Mississippi Delta region has a significant population of uninsured children.
Purpose of the Study:
- To analyze healthcare utilization and associated costs for previously uninsured children in a rural setting.
- To assess the impact of a school-based health insurance program on service use.
- To determine if a 'pent-up demand' for services exists in this population.
Main Methods:
- Analysis of four-year claims data from a school-based insurance program in the Mississippi Delta.
- Comparison of service utilization with the 1987 National Medical Expenditure Survey (NMES).
- Application of mixed-model logistic and linear regressions to evaluate insurance response.
Main Results:
- Healthcare service utilization increased over time, approaching NMES levels.
- Conditional medical expenditures also rose, though actual claims costs were lower than actuarial estimates.
- A limited benefit package cost approximately $20-$24 per member per month.
Conclusions:
- The study did not find evidence of significant pent-up demand for medical services among these children.
- Limited insurance benefits were cost-effective, with actual costs below projections.
- Data on previously uninsured children can help lower premium costs for state insurance programs.
Objective:
To examine the healthcare utilization and costs of previously uninsured rural children.
Data Sources/Study Setting:
Four years of claims data from a school-based health insurance program located in the Mississippi Delta. All children who were not Medicaid-eligible or were uninsured, were eligible for limited benefits under the program. The 1987 National Medical Expenditure Survey (NMES) was used to compare utilization of services.
Study Design:
The study represents a natural experiment in the provision of insurance benefits to a previously uninsured population. Premiums for the claims cost were set with little or no information on expected use of services. Claims from the insurer were used to form a panel data set. Mixed model logistic and linear regressions were estimated to determine the response to insurance for several categories of health services.
Principal Findings:
The use of services increased over time and approached the level of utilization in the NMES. Conditional medical expenditures also increased over time. Actuarial estimates of claims cost greatly exceeded actual claims cost. The provision of a limited medical, dental, and optical benefit package cost approximately $20-$24 per member per month in claims paid.
Conclusions:
An important uncertainty in providing health insurance to previously uninsured populations is whether a pent-up demand exists for health services. Evidence of a pent-up demand for medical services was not supported in this study of rural school-age children. States considering partnerships with private insurers to implement the State Children's Health Insurance Program could lower premium costs by assembling basic data on previously uninsured children.