The effects of cost-shifting in the state children's heath insurance program

Many states are increasing the State Children's Health Insurance Program (SCHIP) cost-sharing requirements to induce reductions in enrollment. We examined the effect of increasing SCHIP premiums on both health care use and cost to the public.

The net cost to the public of increased cost sharing for SCHIP-insured children in a border community was estimated with multivariate methods. The majority (88%) of children were of Mexican origin.

We estimated that a $10 increase in monthly premiums would induce 10% of SCHIP children to disenroll, resulting in a 6% increase in public expenditures.

Families that disenroll from SCHIP and become uninsured typically turn to emergency departments for primary care, which increases total health care expenditures through the use of more expensive services.