The Effects of SCHIP on Children's Health Insurance Coverage

Early Evidence from the Community Tracking Study

December 2002
Medical Care Research and Review , Vol. 59, No. 4 (December 2002), 359-383
Peter J. Cunningham, Jack Hadley, James D. Reschovsky

The State Children’s Health Insurance Program (SCHIP) was designed to increase the number of children with health insurance coverage without resulting in large numbers of children substituting public coverage for private insurance. This study uses data from the Community Tracking Study collected before and after SCHIP implementation to examine the effects of increases in eligibility for public coverage on children’s health insurance coverage. Using a regression-based difference-in-differences approach, the authors find that increases in eligibility for public coverage did increase the likelihood of having Medicaid or other state coverage versus being uninsured for the primary SCHIP target population - children in families with incomes between 100 and 200 percent of the federal poverty level. However, eligibility increases also increased the likelihood of having public coverage versus private insurance for this income group, indicating that SCHIP expansions resulted in substitution of public for private insurance. In fact, simulation results indicate that the initial impact of SCHIP on private insurance coverage has been far greater than on uninsurance rates. These results reflect the early stages of SCHIP implementation, however, and are subject to change as the SHCIP programs mature.