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Effective Date:

Approval Date:

Updated and amended effective August 24, 2001

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the persons insured by employer based coverage. The continued stability of the rate of employer based coverage supports the hypothesis that no serious degree of “crowd out” has or is occurring as the result of expansion of publicly funded health care programs.

4.4.4.2. Coverage provided to children in families over 200% and up to 250% FPL: describe how substitution is monitored and identify specific strategies to limit substitution if levels become unacceptable.

Monitoring: Pennsylvania will continue to monitor the rate of employer based coverage for changes. In addition to using information obtained from the applications, Pennsylvania is implementing a cross match through a Third Party Liability contract to determine current and recent health insurance status. This match will assist in the determination that the applicant is currently uninsured and has met the required period of uninsurance. This match will also provide us a source of data, other than applicant provided information, on the number of individuals who applied for CHIP and had private insurance within the previous six months prior to application. With the addition of this data, we will be able to more accurately determine the possibility of substitution among these individuals.

Strategy to limit substitution – children over the age of two: Pennsylvania is implementing an uninsured period of six months. Children, over the age of two with a net income of over 200% of FPL, who were covered by a health insurance plan, a self-insurance plan or a self funded plan, are not eligible to enroll in CHIP for a period of six months following the end date of the private insurance except if the child’s parent is eligible to receive unemployment compensation or is no longer employed and is ineligible for unemployment compensation, or the child is transferring from one government subsidized health care program to another.

Another disincentive for dropping private coverage is the addition of cost sharing (premiums and copayments) in the CHIP benefit package for families with net incomes greater than 200% of FPL.