Cuts to Texas CHIP in the All-Too-Recent-Past

            Eight years ago, in 2003, Texas experienced a budget crisis due to a shortfall of about $10 billion. Legislators targeted CHIP in an effort to make up for the deficit, by tightening eligibility requirements and raising premiums. The result? 130,000 children (25% of total state enrollment) were kicked out of the program. Texas Monthly reporter Jim Atkinson examines the impacts of dropping so many kids from CHIP in State of Emergency:

            Atkinson writes about his observations at the emergency room of the Children’s Medical Center Dallas – “the busiest pediatric emergency department in the country.” In speaking with one of the main doctors at the hospital, Dr. Thomas Abramo, Atkinson discovers that a direct result of the cuts to CHIP has been a significant increase in the number of patients who come to the hospital for nonemergencies, like upset stomachs, colds, and asthma attacks. Parents with uninsured children feel that they have nowhere else to turn when their kids are hurt or sick but the emergency room, which is legally obligated to treat them. At the time this article was written, in 2004, Children’s Medical Center in Dallas had experienced a 17 percent increase in the number of patients it treated since 2000 – from 90,000 to 105,000 per year. One nurse notes that waiting times can last up to twelve hours.

            After thousands of children were forced out of CHIP, the financial burden of medical care shifted from the program to the hospitals themselves. Children’s Medical Center estimates that “the amount that the hospital spends out of its own pocket on patients who have no insurance has more than doubled over the past decade.” Furthermore, it costs everyone more money when thousands of children and families skip the doctor’s visits (because they feel like they cannot afford them), and wait until their health deteriorates and requires urgent attention: “The shift from preventative care to emergency care is driving up the cost of health-care premiums statewide.”

            In perhaps the most poignant section of his story, Atkinson writes:

“Cases like these have created a sort of negative feedback loop: More and more uninsured children show up at the ER with minor problems, which drives up the cost of everybody else’s health care, which drives more children  out of the health-care system.”

This terrible cycle has a very negative effect on hospital finances, since they bear the burden that CHIP once did. Serving so many uninsured patients who cannot pay the hospital bills means a dip in revenue that the facility brings in. It is as unsustainable as it is humane.

            These examples of the negative consequences of forcing 130,000 Texas children out of the Children’s Health Insurance Program must be kept in mind as our legislators grapple with the difficult questions of what to cut in order to make up for our state’s now $27 billion dollar shortfall – nearly 3 times as much as it was back in 2003. The cuts to be made will be much deeper, and certainly have more far-reaching implications. May CHIP escape the worst of these cuts.

Source:  Atkinson, Jim. (2004). Texas Monthly. Retrieved from http://www.texasmonthly.com/2004-10-01/reporter2.php