A Race to the Top: Illinois’s All Kids Initiative - Report

kaiser commission on medicaid and the uninsured

A Race to the Top: Illinois's All Kids Initiative

Prepared by Teresa A. Coughlin and Mindy Cohen The Urban Institute

August 2007

kaiser commission medicaid and the uninsured

The Kaiser Commission on Medicaid and the Uninsured provides information and analysis on health care coverage and access for the low-income population, with a special focus on Medicaid's role and coverage of the uninsured. Begun in 1991 and based in the Kaiser Family Foundation's Washington, DC office, the Commission is the largest operating program of the Foundation. The Commission's work is conducted by Foundation staff under the guidance of a bipartisan group of national leaders and experts in health care and public policy.

James R. Tallon Chairman Diane Rowland, Sc.D. Executive Director

kaiser commission on medicaid and the uninsured

A Race to the Top: Illinois's All Kids Initiative

Prepared by Teresa A. Coughlin and Mindy Cohen The Urban Institute

August 2007

AKNOWLEDGEMENTS

The authors gratefully thank the many state officials and other study participants who gave generously of their time and insights. We could not have completed the study without them. We also thank Jennifer Tolbert and Barbara Lyons of the Kaiser Commission of Medicaid and the Uninsured at the Henry J. Kaiser Family Foundation for their support and guidance throughout the project.

Executive Summary

In the summer of 2006, Illinois joined several other states in advancing health care reform by launching the nation's first universal coverage program for children. Called "All Kids," the initiative builds on the state's Medicaid and State Children's Health Insurance Program (SCHIP) programs but is funded exclusively with state funds. The program offers coverage to all uninsured children, regardless of income, health status or citizenship. On a sliding income basis, families can purchase coverage under All Kids, and as of April 2007, nearly 50,000 children were enrolled in the program. The entire Medicaid, SCHIP and state only programs cover 1.3 million children under the umbrella of All Kids.

This brief reports on a case study of the All Kids initiative that was conducted in spring 2007. It provides some general background information on Illinois's public health programs, describes key features of All Kids, and discusses why the state designed the program the way it did. The report also highlights early program experiences.

With particularly strong leadership of Governor Rod Blagojevich (the principal architect of the initiative), along with widespread support from state advocacy groups, health care stakeholders and the legislature, All Kids was implemented in July 2006. In terms of enrollment, the program has met with great success and has surpassed state targets. Interviewees attribute some of that success to the state's considerable outreach effort that involved several innovative strategies including an application agent initiative in which community organizations, medical providers and insurance agents help individuals complete the All Kids application. Illinois's consumer friendly application is also noted as a being a major reason for the program's early enrollment success. Another important ingredient cited is the universality of All Kids--that is, the program is simply available to all children in the state, which makes it easy to market and easy for families to understand.

In putting the program together, Illinois officials had to deal with several programmatic matters. For example, because the program is available to children at all income levels, the state wanted to deter both employers from dropping dependent coverage and families from dropping private coverage to enroll their children in All Kids. So they opted to impose a 12-month uninsurance waiting period for children in families with income over 200 percent of the federal poverty line, though there are several exceptions to the rule such as children who lost coverage because a parent lost a job for any reason. Another challenge was how to set cost sharing to emphasize preventive care and to make it affordable for low-income families. At the same time, for higher-income families, who typically have other insurance options, officials wanted premiums to be sufficiently high to prevent All Kids from "crowding out" private coverage. Under All Kids, no cost sharing is imposed for preventive care (medical and dental) regardless of income, and cost-sharing is designed so that the program is "very affordable" for low-income families. For higher-income families, All Kids premiums are set to be comparable to those in the commercial market.

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