The Kids Are All Right -- For Now 

One side-effect of the intense national debate about repealing the ACA is that Americans have been getting a real-time tutorial in how the parts of our complex healthcare system interconnect.

As a pediatrician, I can shed some light on how children would be affected by the deep funding cuts to Medicaid and the Children’s Health Insurance Program (CHIP) that GOP Senate leaders have proposed.  Employer health plan sponsors who assume these cuts would have limited effect on their covered populations may be overlooking the systemic dependencies that exist in funding pediatric care for many families.

For one thing, a significant and growing number of parents in low- and middle-income families are choosing to enroll their children in Medicaid or CHIP.  An article in Health Affairs reported that 15% of children in working families at 100 to 400% of the poverty level were covered in public programs in 2013, despite having parents with access to employer coverage.  The authors suggested the increase might be linked to the rise of high-deductible health plans, which can strain the finances of lower-income families. What would it mean for employers and these employees if funding for public health programs were cut? While this will depend on how states design options to manage the shortfall, it is conceivable that there will be fewer benefits, sparser access, or that these children will return to the employer-based system.

But even children enrolled in employer-sponsored plans could be impacted by Medicaid shortfalls. Children of every economic stratum, particularly those with complex illness or traumatic injuries, rely on and benefit from services at centers that are largely dependent on Medicaid payments. (1) Serious illness and trauma are rare in children and the expertise, equipment, and facilities required to treat serious pediatric illness are different than for adult patients. The health delivery system has concentrated this expertise into designated referral facilities that attract the volume from catchment areas, thus allowing the centers to fund and maintain specialized services for children.

All children have potentially benefited from this system as accelerated research and refined protocols have improved outcomes for pediatric conditions such as cystic fibrosis and pediatric cancers. Medicaid is a significant payer for care at these centers.

In a recent conversation, Dr. Paul Wise, the Richard E. Behrman Professor of Child Health and Society and Professor of Pediatrics at Stanford University School of Medicine, eloquently articulated the impact of cuts on the system: “What gets lost in the debate is that all kids are impacted as the best specialty care for employer-sponsored insured children is the same as the children on Medicaid. Seriously ill children funnel into the same system and the vast majority of these sites are dependent on Medicaid.”

Public awareness of Pediatric specialty services was escalated when Late Night host Jimmy Kimmel’s infant was born with a complex cardiac defect and received care at such a referral site. The expertise of surgeons, nursing staff, imaging teams, and other support personnel who treated the child of the affluent Mr. Kimmel developed, refined, and sustained their skills at a pediatric center where 71% percent of payment comes from Medicaid.  There is no two-tier system for high-risk pediatric care. There is, thankfully, outstanding care. Thus, caps in the system impact both existing access and the progress in pediatric specialty care for both employer-based and Medicaid recipients, now and into the future.  Dr. Wise summarizes that, “Medicaid is not a perfect system and waiver programs to the state might help drive innovation, but cuts to Medicaid funding will ripple across the epidemiology of childhood.”

This is something to ponder for employers, parents and, I would say, all of us. Whatever the fate of the current GOP Senate health reform bill, the specter of Medicaid cuts has been raised and is likely to remain part of the debate for the foreseeable future.

1. Dreyful et al: Comparison of Pediatric Motor Vehicle Collision Injury Outcomes at Level I Trauma Centers/j.jpedsurg.2016.04.005

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