| The Balanced Budget Act of 1997 created the State Children's Health Insurance Program (S-CHIP), which enables the states to increase health insurance coverage to uninsured children. States are eligible to receive approximately {dollar}4.3 billion this year. Consequently, there is an urgent need for policymakers to predict the cost to the states of insuring their uninsured children.; Until now, we knew little about how uninsured children's utilization might change after obtaining insurance. My dissertation provides an empirical estimate of the incremental economic cost of insuring previously uninsured children based on the experience of New York State's Child Health Plus program (CHPlus). The legislation that created CHPlus in NY requires a comprehensive evaluation of the program, which gives me a unique opportunity to measure this change in utilization. I use data that was collected for the evaluation to perform an analysis of the program. My analysis has three basic parts. The first is an estimate of the cost model of CHPlus. The model predicts how each type of utilization contributes to total costs. In the second part, I estimate the CHPlus-effect on utilization. This tells me how utilization of medical services changes because of CHPlus. Finally, I estimate the cost to insure all eligible uninsured children in the U.S. in a CHPlus-type program. I apply my cost model and estimates of the CHPlus-effects to my estimates of the number of eligible, uninsured children nationwide.; My final cost estimate represents the change in dollars spent on health care services by the eligible population once they become enrolled in S-CHIP. I conclude that the incremental economic cost of CHPlus in the first year is {dollar}439 million. This {dollar}439 million represents 32.6 percent of the expected outlay of {dollar}1.35 billion in the first year to insure the nation's uninsured children. The other 67.4 percent represents a pure economic redistribution of costs to taxpayers, much of which taxpayers pay anyway through government charity care, immunization programs and programs to cover medical bad debt. They also pay as members of the insured population through higher insurance premiums that, in part, cover expenses associated with the uninsured. |
