Testimony on SB 2364 - Including Unborn Children in Children's Health Insurance Program

To: Senate Human Services Committee
From: Christopher Dodson, Executive Director
Subject: SB 2364 -- Including Unborn Children in the Children’s Health Insurance Program
Date: February 3, 2003

The North Dakota Catholic Conference supports Senate Bill 2364, to include eligible unborn children in North Dakota’s State Children’s Health Insurance Program (SCHIP.)

On November 1, 2002, the Department of Health and Human Services implemented new regulations for SCHIP. The rule summarizes the changes as follows:

In order to provide prenatal care and other health services, this final rule revises the definition of ‘‘child’’ under the State Children’s Health Insurance Program (SCHIP) to clarify that an unborn child may be considered a ‘‘targeted low-income child’’ by the State and therefore eligible for SCHIP if other applicable State eligibility requirements are met. Under this definition, the State may elect to extend eligibility to unborn children for health benefits coverage, including prenatal care and delivery, consistent with SCHIP requirements.

This summary answers some of the basic questions about the new regulations. The changes to the federal regulations are quite simple and few. States now have the option of including children from conception to birth under the definition of “child” in the state’s SCHIP program. Assuming the unborn child met the eligibility requirements for inclusion in the program, the child could receive health benefits coverage, such as coverage for prenatal care. Senate Bill 2364 directs the state to exercise that option.
Although the idea is simple, we realize it raises a number of questions. Before addressing some of those questions, it behooves us to look at the purpose of the bill and the revised federal regulations.

The purpose of the SCHIP program is to help the children of families that earn enough to not qualify for medicaid, but cannot afford health insurance. Unfortunately, until the federal revision, children at the earliest -- and often most developmentally crucial -- stages of life could not receive that help. Extending the coverage to those stages is consistent with state law and policy and makes sense from a health care and budgetary perspective.

The North Dakota legislature recognized the importance of care during these stages when it expressly required prenatal coverage for pregnant minors on SCHIP. (N.D.C.C. § 50-29-04.) . Indeed, it would seem inconsistent to say that the unborn child of the teenage mother on SCHIP is entitled to coverage, but the child of a working mother who cannot afford health insurance is not. When it comes to their need, the is little or no difference. Nor would does make much sense to not provide prenatal services to a child that will necessarily be enrolled in SCHIP after birth, especially if that prenatal care will increase the likelihood that the child will be healthy.

In short, the Department of Health and Human Services has given us a unique opportunity to provide health coverage in a manner consistent with good health care, state policy, and fairness. Senate Bill 2364 provides the vehicle for taking advantage of that opportunity.

What makes this opportunity even more attractive is the ease at which it is exercised and its extremely low cost. To take advantage of the new eligibility option, the state only needs to amend the state plan. The other requirements are only modifications of existing eligibility and screening practices.

To understand the low financial cost of the proposal, it helps to keep in mind a few points:

• Changing the definition of “child” to include unborn children does not add new lives to the program, it only extends services to an earlier period of time for persons who otherwise would not be on the program until after birth.

• Although the child would not be eligible for medicaid, the mother might. If the mother is medicaid eligible, the unborn child would not be covered under SCHIP.

• The covered person is the unborn child, not the mother. The proposed change in SB 2364 does not place pregnant women under the definition of “child” so that they would be eligible for all covered services. The bill only places eligible unborn children within the definition of “child.” Therefore, only services for which there is a connection between the “benefits provided and the health of the unborn child” would be covered. (Federal Register, Vol. 67, No. 191, p. 61968.)

• Since the child is unborn, the range of services potentially utilized before birth is limited. Essentially, the services amount to prenatal care.

• About 23 children a year would be eligible for the earlier coverage. (In 2002, 30 infants eligible for CHIPS were born that same year. Of those 30, seven had mothers who were on medicaid during the month of the birth.)

• The estimated cost of prenatal services is $1,000.

Keeping these facts in mind, we can estimate the fiscal impact of the bill multiplying the cost of prenatal services by the number of expected eligible unborn children a biennium. The state’s share of that additional cost is 22.1%. Therefore, the estimated state cost of adding services for unborn children is about $10,000 for the entire biennium. (23 children x $1000 x 2 years = $43,000; $43,000 x .221 = $10,166.) Since the SCHIP appropriation request is already slightly over the estimated cost of the monthly premiums, the additional cost to the appropriation request is about $6,000.

Senate Bill 2364, therefore, seizes a rare opportunity. Through this bill, the state can provide essential health care coverage for persons who otherwise would not be covered, benefit both mother and child by promoting the continuity of important medical care, decrease likelihood of having unhealthy children on SCHIP, potentially decrease public expenditures over the child’s lifetime, and reflect the state’s policy of respecting and assisting unborn children -- all for what essentially fits into the “wiggle room” already built into the state’s budget request.

We strongly urge a Do Pass recommendation on Senate Bill 2364.