What is the Minnesota Children’s Health Security Act?
The Minnesota Children’s Health Security Act is legislation that would ensure universal health care coverage for all children living in Minnesota by 2010 in a two-phase approach.  The legislation has been introduced in the Minnesota House (HF 132) and Senate (SF 20) and will be reintroduced during the 2007 legislative session. All children through age 18 as well as young adults under age 25 who are students and still dependents would be eligible for the program.  The first phase of the Act would place all children whose family income is below 300% of the Federal Poverty Guidelines ($60,000 for a family of four) into one purchasing pool by 2008.  Phase I would cover all children currently covered by public programs as well as some children covered by private insurance. In Phase II, the program would be open to all Minnesota children beginning in 2010.  Coverage through the children’s health pool would be voluntary.

Isn’t Minnesota doing just fine on children’s health coverage?
Minnesota is actually moving backward on children’s health coverage.  According to the most recent state data, there are 68,000 uninsured children in Minnesota.  This is an increase from 56,000 over a three-year period (2001-2004).  In addition, the number of uninsured children ages 0-5 spiked by 11,000 during the same period.  These are critical developmental years, yet uninsured children are less likely to receive immunizations and preventive care.

The high cost of premiums along with administrative burdens such as waiting periods and cumbersome renewal processes make coverage precarious for many other families.

Why the Children’s Health Security Act?
The Minnesota Children’s Health Security Act is good for children, families, employers and the health care system as a whole.  The Children’s Health Security Act will:

• Ensure all children have access to affordable, quality health care coverage, no matter where their parents work or how much they earn;
• Create systemic change that would simplify the current health care system, remove administrative and cost barriers and make children’s health a top priority;
• Ensure consistent, continuous care and promote preventive care for children;
• Produce savings for employers currently offering child dependent coverage; and
• Produce savings to the health care system in the long run by pooling children and eliminating the costs of uninsured children.

How much will the Children’s Health Security Act Cost?
According to a recent actuarial study which examined the cost of the Children’s Health Security Act, the annual cost of spending on children’s health coverage in Minnesota is $3.1 billion, including the public spending, commercial insurance and the cost of the uninsured.  Public spending under Phase I of the Children’s Health Security Act would increase by $590 million from $1.17 billion to $1.76 billion.  The increase includes covering an additional 301,000 children in what are now MinnesotaCare and Medical Assistance (Minnesota’s Medicaid program). 

Children’s Health Security Act advocates are in the process of seeking funds for an actuarial estimate for Phase II costs.

What Kind of Savings will the Act Produce?
The Children’s Health Security Act will produce savings to parents, employers and the overall health care system. Premiums paid by employers and employees will decrease by 22% in Phase I, resulting in $400 million in savings for employers and employees.  Eliminating out-of-pocket expenses for parents (e.g. co-payments and deductibles) will produce an additional $138 million in savings for low and middle income parents in Phase I. 

In addition, uncompensated care costs for children will be drastically reduced or eliminated.  According to the Minnesota Department of Health, uncompensated care costs were $74 million for children in 2004.

Finally, pooling children will streamline publicly funded health care programs, which will increase efficiency and ultimately reduce total spending on children’s health coverage. 

How will the Children’s Health Security Act be Funded?
The Children’s Health Security Act will be funded through a combination of state and federal dollars.  Minnesota will pursue federal match dollars for the eligibility increase in Phase I.  The state funding mechanism will be sustainable and broad-based, such as general fund dollars.

Why only children?
Universal coverage for children is attainable. We need to move toward universal coverage for all Minnesotans, but it is difficult to achieve universal coverage all at once. The Minnesota Citizens Forum on Health Care Costs, chaired by former U.S. Senator David Durenberger, recommended universal coverage as a key solution to addressing health care costs, “with a priority of covering all children.” Children are less costly to cover (about 60-70% of the cost of adults), making children a feasible starting point for universal coverage. In addition, more than 80% of the public supports universal coverage for all children in Minnesota.