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the Congress on Improper Enrollment and Reductions in Low-Income, 
Uninsured Children' which was released on March 9, 2006. 

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March 9, 2006: 

Congressional Committees: 

Subject: Children's Health Insurance: Recent HHS-OIG Reviews Inform the 
Congress on Improper Enrollment and Reductions in Low-Income, Uninsured 
Children: 

The Congress passed legislation creating the State Children's Health 
Insurance Program (SCHIP) in 1997 to reduce the number of uninsured 
children in families with incomes that are too high to qualify for 
Medicaid.[Footnote 1] For SCHIP, the Congress appropriated $40 billion 
over 10 years, with funds allotted annually to the 50 states, the 
District of Columbia,[Footnote 2] and the U.S. commonwealths and 
territories. States' participation in SCHIP is voluntary. States that 
do participate have three options in designing their SCHIP programs: 
expand the Medicaid program to include SCHIP-eligible children, develop 
a separate child health insurance program, or maintain a program that 
combines both of these options. Financed jointly by the states and the 
federal government, SCHIP offers a strong incentive for states to 
participate by offering a higher federal matching rate--that is, the 
federal government pays a larger proportion of program expenditures-- 
than the Medicaid program.[Footnote 3] While this incentive encourages 
efforts to reduce the number of uninsured children through state 
participation in SCHIP, there have been concerns that states might 
inappropriately enroll Medicaid-eligible children in SCHIP and thus 
obtain higher federal matching funds than allowed under Medicaid. In 
addition, there has been interest in assessing the progress states made 
to reduce the number of uninsured children, including the extent to 
which states met the objectives and goals established in their SCHIP 
programs.[Footnote 4] In particular, states must report their progress 
in reducing the number of low-income, uninsured children and may rely 
on certain national data sets, such as the Current Population Survey 
(CPS), or conduct their own surveys, to do so. 

In the Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 
1999 (BBRA), the Congress directed the Department of Health and Human 
Services (HHS) Office of Inspector General (OIG) to conduct a series of 
studies on two issues--determining the number of children who were 
enrolled in separate SCHIP programs but were eligible for Medicaid and 
assessing states' progress in reducing the number of low-income, 
uninsured children--every 3 years, beginning in fiscal year 
2000.[Footnote 5] This provision required the OIG to only include in 
its studies states with separate SCHIP programs. BBRA directed that we 
review and report on the OIG's work. The OIG issued its initial reports 
in February 2001, and our assessment of the OIG's work was published in 
March 2002.[Footnote 6] 

The OIG's most recent set of reports on these issues was published in 
2004 and 2005.[Footnote 7] This report reflects our evaluation of the 
OIG's recent reports. Specifically, we assessed the OIG's efforts to 
inform the Congress on (1) the number of Medicaid-eligible children 
enrolled in separate SCHIP programs and (2) states' progress in 
reducing the number of uninsured children, including the progress they 
have made in meeting the objectives and goals initially established in 
their SCHIP programs. 

To assess the OIG's work, we reviewed the OIG's methodologies and 
findings. We also interviewed the OIG officials who conducted these 
studies to clarify questions and to discuss their response to our prior 
recommendations.[Footnote 8] Finally, we examined the OIG's 
recommendations to the Centers for Medicare & Medicaid Services (CMS), 
which administers SCHIP. Our work was conducted from December 2005 
through March 2006 in accordance with generally accepted government 
auditing standards. 

Results in Brief: 

The OIG's most recent set of reports on improper SCHIP enrollment and 
states' progress in reducing the number of low-income, uninsured 
children informed the Congress about these issues and included 
improvements from its initial studies. For example, in evaluating the 
number of children who were enrolled in separate SCHIP programs but 
were eligible for Medicaid, the OIG broadened the scope of its initial 
study to include a random sample of children's case files from the 34 
separate SCHIP programs with available data. In its initial study 
responding to the BBRA mandate, the OIG only examined case files from 5 
separate SCHIP programs. In its most recent report, the OIG estimated 
that only 1 percent of children were improperly enrolled in separate 
SCHIP programs. The confidence interval the OIG calculated for its 
enrollment error rate, which provides an estimated range of values that 
is likely to include the true error rate, was 0.3 to 2.6 percent. We 
believe that this confidence interval is relatively wide for such an 
analysis and is likely the result of the small sample of case files 
reviewed by the OIG. However, we recognize that even at its upper 
bound, the enrollment error rate for the population would be 2.6 
percent. In addition, 7 percent of separate SCHIP case files did not 
include enough information to support enrollment decisions, but the OIG 
did not find any evidence in these case files to indicate that the 
enrollment decisions were inappropriate. In part to respond to our 
earlier recommendation that the OIG expand its scope beyond the 
separate SCHIP programs, the OIG further informed the Congress about 
improper SCHIP enrollment by conducting an additional study in 29 
states with Medicaid expansion programs. This study, which also 
evaluated the enrollment decisions in a random sample of case files, 
identified 7 percent of sampled children as not meeting the state 
eligibility criteria for Medicaid expansion and 10 percent of case 
files as having missing documentation. 

Similarly, for its most recent review of states' progress in reducing 
the number of low-income, uninsured children, the OIG expanded its 
scope to include the 46 states that submitted SCHIP annual reports for 
fiscal year 2002. In its initial study responding to the BBRA mandate, 
the OIG only examined the annual reports of 5 states with separate 
SCHIP programs. The OIG also supplemented its most recent review by 
examining several national data sources on the uninsured. The OIG noted 
that states continue to face challenges in their efforts to measure the 
change in the number of low-income, uninsured children, and only 22 of 
the 46 states that submitted reports directly measured their progress 
in this area. One of the biggest challenges in measuring progress is 
the limitation in data sources--including the often-used CPS, which for 
various reasons, such as small sample sizes, has not produced reliable 
state-level estimates in the past. In light of these obstacles, the OIG 
recommended that CMS continue to work with states to address concerns 
about data sources used to measure such progress. We concur with this 
recommendation. In addition, absent state submission of data directly 
measuring changes in low-income, uninsurance rates through their SCHIP 
annual reports, the OIG suggested, and we concur, that CMS could itself 
measure such reductions by completing its own analysis of available CPS 
data, which now include the results of broader state samples. 

In commenting on a draft of this report, the OIG did not comment on our 
findings. The OIG provided technical comments, which we incorporated as 
appropriate. 

Background: 

Medicaid and SCHIP, joint federal-state programs to finance health care 
coverage for certain categories of low-income individuals, represent 
the primary source of health insurance coverage for low-income, 
uninsured children. Although Medicaid has provided coverage to children 
since 1965, SCHIP is a relatively new program, established in 1997. As 
of January 2006, 11 states had expanded their Medicaid programs to 
include children eligible for SCHIP, 19 states had separate SCHIP 
programs, and 20 states had combination programs.[Footnote 9],[Footnote 
10] (See fig. 1.) 

Figure 1: States' Design Choices under SCHIP, January 2006: 

[See PDF for image] 

[End of figure] 

Medicaid program expenditures are shared between states and the federal 
government, and the share is determined using a formula that is based 
on a state's per capita income in relation to the national average. 
Federal matching rates for SCHIP are "enhanced"--they are established 
under a formula that takes 70 percent of a state's Medicaid matching 
rate and adds 30 percentage points, with an overall federal share that 
may not exceed 85 percent.[Footnote 11] In fiscal year 2006, the 
enhanced federal match rates for SCHIP ranged from 65 to about 83 
percent while the federal match rates for Medicaid programs ranged from 
50 to about 76 percent. 

Under SCHIP, each state is required to submit a SCHIP plan and an 
annual report, which must include a description of the state's progress 
in reducing the number of low-income, uninsured children. States may 
rely on the CPS, which is a monthly survey of a sample of American 
households conducted by the Census Bureau and collects information on 
characteristics of the labor force, to report progress in reducing the 
number of low-income, uninsured children.[Footnote 12] In particular 
months, the Census Bureau supplements its survey by incorporating 
additional questions. For example, the March Supplement historically 
asks respondents about their health insurance status and provides the 
only nationwide source of information on uninsured children by state. 

The OIG's Assessment of Improper Enrollment Identified Few Errors: 

By broadening the scope of its initial study, the OIG's most recent set 
of reports on the number of children who were enrolled in separate 
SCHIP programs but were eligible for Medicaid more fully informed the 
Congress on this issue. In contrast to its initial study in which the 
OIG reviewed case files for five separate SCHIP programs, the OIG's 
most recent work included a review of a sample of case files from all 
separate SCHIP programs for which data were available. Similar to its 
initial study, the OIG identified only 1 percent of children as being 
improperly enrolled in separate SCHIP programs. The confidence interval 
the OIG calculated for its enrollment error rate is relatively wide; 
however, even at its upper bound, the error rate would be 2.6 percent 
for the population. The OIG augmented this work by also evaluating 
enrollment decisions in a random sample of case files from 29 Medicaid 
expansion states. 

The OIG's Assessment of Improper Enrollment Broadened to Include Nearly 
All SCHIP Programs: 

The OIG broadened the scope of its initial study from a review of 5 
separate SCHIP programs to a review of the 34 separate SCHIP programs 
for which data were available.[Footnote 13] From these programs, the 
OIG selected a random sample of 400 case files to assess enrollment 
decisions. After eliminating cases that did not fit study criteria, the 
OIG ultimately reviewed 386 case files. The OIG reviewed documentation 
within the case files, including the SCHIP application or the most 
recent eligibility redetermination; supporting income documentation; 
and calculation sheets states used to determine family income. The OIG 
did not verify the accuracy and completeness of the state case files; 
rather, it focused on whether the information in each file supported 
the eligibility determination reached by the state. If case files were 
missing documentation, the OIG determined if the files included any 
information that indicated enrollment decisions were inappropriate. 
Using the same methodology, the OIG also reviewed a random sample of 
case files in 29 Medicaid expansion programs with available 
data.[Footnote 14] Of the 400 case files randomly selected for this 
study, 357 met study criteria and were reviewed. This additional work 
was undertaken in part to respond to our earlier recommendation that 
the OIG expand its review to include Medicaid expansion programs. The 
OIG's review of enrollment decisions in both separate SCHIP and 
Medicaid expansion programs went beyond the BBRA mandate and more fully 
informed the Congress on this issue. 

The OIG's sample of case files was drawn from over 80 percent of all 
separate SCHIP and Medicaid expansion programs with available data. 
Nevertheless, our assessment is that this sample was small compared to 
the total SCHIP population, as it represented 0.01 percent of total 
separate SCHIP enrollees and 0.04 percent of Medicaid expansion 
enrollees. The small sample size resulted in a less precise estimate of 
the number of cases of inappropriate SCHIP enrollment. In discussing 
our assessment of the sample size, the OIG emphasized the increased 
work associated with broadening its scope from 5 to 34 separate SCHIP 
programs and reviewing the additional 29 Medicaid expansion programs. 
The OIG also explained that the size of its sample was influenced, in 
part, by available resources and competing priorities. 

The OIG's Reviews Identified Few Examples of Inappropriate Enrollment: 

The OIG's findings regarding the number of children improperly enrolled 
in separate SCHIP programs paralleled its earlier study on this topic, 
with only 1 percent of children (4 of 386 cases) identified as being 
inappropriately enrolled. In each of these 4 cases, the children were 
eligible for the respective state's Medicaid program. In its Medicaid 
expansion study, the OIG identified 7 percent of sampled children (24 
of 357 cases) as not meeting the state eligibility criteria for 
Medicaid expansion. Of these cases, 21 had family incomes that were too 
low to qualify for Medicaid expansion, and the remaining 3 had family 
incomes that were too high to qualify. For both separate and expansion 
programs, enrollment errors were due to a variety of reasons, including 
caseworkers misinterpreting income information, multiplying daily wages 
by the wrong number of days, or basing a family's income on weekly as 
opposed to biweekly pay. 

For the separate SCHIP study, the OIG projected its error rate estimate 
to the population, and a 95 percent confidence interval was estimated 
as 0.3 to 2.6 percent.[Footnote 15] The confidence interval, which we 
consider to be relatively wide in light of the enrollment error rate of 
1 percent, is likely a result of the small sample size.[Footnote 16] 
However, even at its upper bound, the error rate would be 2.6 percent 
for the population. The OIG did not project to the population for 
Medicaid expansion programs because of problems identified with 
population data provided by certain states, such as data that 
mistakenly included children who were enrolled in states' traditional 
Medicaid programs. 

In addition to the definitive cases of inappropriate enrollment 
identified above, the OIG noted that some case files--approximately 7 
percent of the 386 separate SCHIP and 10 percent of the 357 Medicaid 
expansion case files--did not include complete documentation to support 
enrollment determinations. However, the OIG reviewed the documentation 
included in these case files and did not identify any information that 
indicated enrollment decisions were inappropriate. Further, the OIG 
explained that for the case files with missing documentation, income 
levels were toward the middle of the SCHIP eligibility range, as 
opposed to near the lower bound of the range closer to Medicaid 
eligibility levels. Therefore, errors in documentation or calculations 
of resources would have needed to be extensive for the children to be 
eligible for traditional Medicaid as opposed to SCHIP. We concurred 
with the OIG's reasoning. 

The OIG Identified Challenges States Face in Determining the Number of 
Uninsured and Opportunities for CMS Assistance: 

To assess states' progress in reducing the number of low-income, 
uninsured children, the OIG also broadened the scope of its mandated 
review to include all states that submitted SCHIP annual reports for 
fiscal year 2002 by June 1, 2003. The OIG's review of these annual 
reports indicated that states continue to experience challenges when 
determining their progress in reducing the number of low-income, 
uninsured children, primarily with data sources. We agree with the 
OIG's recommendation that CMS continue to work with states to address 
concerns about data sources used to measure their progress in reducing 
the number of low-income, uninsured children. 

The OIG's Review Indicated States' Efforts to Report Progress in 
Reducing Uninsured Children Are Hindered by Data Limitations: 

Similar to its most recent work on inappropriate enrollment in SCHIP 
programs, the OIG expanded its review of state efforts to measure 
changes in the number of low-income, uninsured children. The OIG 
reviewed the fiscal year 2002 SCHIP annual reports of the 46 states 
that submitted them by June 1, 2003. In its initial report, the OIG 
reviewed reports from 5 states' separate SCHIP programs.[Footnote 17] 
The OIG reviewed the annual reports to determine states' progress in 
meeting the strategic objective of reducing the number of uninsured 
children. While 22 states used CPS or state survey data to demonstrate 
changes in the uninsured population of children, the remaining 24 
states did not respond directly to the objective.[Footnote 18] Instead, 
19 of these 24 states used SCHIP enrollment data as a proxy for 
demonstrating their progress in reducing the number of uninsured 
children. Of the remaining states, 3 provided responses that did not 
measure insurance coverage or enrollment, and 2 did not respond. 
Further, the OIG augmented its assessment of state efforts by also 
reviewing national data on the uninsured--including data from the CPS, 
the National Health Interview Survey, and the Urban Institute. These 
sources were consistent with the majority of states' annual reports 
that indicated a reduction in the number of uninsured children. By 
expanding its scope, the OIG went beyond BBRA's requirements to inform 
the Congress on states' progress in reducing the population of 
uninsured children. 

The OIG emphasized, and we acknowledge, that efforts to measure 
progress in reducing the number of low-income, uninsured children in 
states continue to be hindered by multiple factors, such as limitations 
in data sources and the often prohibitive cost of conducting state 
surveys. For example, CPS data used by many states have well- 
established shortcomings--particularly with regard to state-level 
estimates--which can be unreliable and exhibit volatility from year to 
year because of small sample sizes. This is particularly true in states 
with smaller populations. Also, children who are enrolled in Medicaid 
are often undercounted in CPS data and may be mistakenly counted as 
uninsured. Finally, as noted in the OIG's recent report, the manner in 
which the Census Bureau asks respondents about their health insurance 
coverage during the past year may lead to respondents incorrectly 
answering the question. As a result, CPS data may overestimate the 
number of uninsured children.[Footnote 19] 

In addition to data source problems, the OIG noted that some states use 
changes in SCHIP enrollment to demonstrate progress in meeting this 
objective. However, we agree with the OIG that increases in SCHIP 
enrollment are not a valid measure of reductions in the number of low- 
income, uninsured children. For example, an increase in SCHIP 
enrollment can be the result of children moving from private health 
insurance coverage to public insurance under SCHIP. In addition, 
declines in the economy and increased unemployment can lead to some 
children losing their private health insurance coverage and enrolling 
in SCHIP, and others becoming uninsured because they are ineligible for 
SCHIP. 

The OIG Suggested CMS Assist States in Future Efforts to Estimate 
Uninsured Children: 

In its most recent report, the OIG recommended, and we agree, that CMS 
should continue to work with states to determine whether ongoing CPS 
sample size improvements have alleviated concerns about limitations in 
the CPS data. In 1999, the Congress appropriated $10 million annually 
for the Census Bureau for fiscal year 2000 and subsequent fiscal years 
to improve the reliability of CPS data for estimating the uninsured 
population of low-income children. Specifically, in response to 
concerns about the reliability of state-level estimates, the Census 
Bureau increased the survey sample size for each state, which may 
improve the accuracy of CPS estimates of low-income, uninsured 
children.[Footnote 20] Although these improved data were available in 
March 2002, not all states used these data in their fiscal year 2002 
SCHIP annual reports. Of the 12 states that used CPS data to determine 
their progress in reducing the number of low-income, uninsured 
children, only 4 used the March 2002 data in their reports. The 
remaining 8 states relied on data from prior years. The OIG did not 
explore the reasons why these 8 states did not incorporate the March 
2002 data in their reports. 

Further, CPS data are easily accessible and are available at no cost. 
Therefore, absent state submission of data measuring changes in low- 
income, uninsurance rates through their SCHIP annual reports, the OIG 
officials suggested, and we concur, that CMS could itself measure such 
reductions by completing its own analysis of CPS data. 

Agency Comments: 

We received comments on a draft of this report from the HHS-OIG (see 
the enclosure). In commenting on a draft of this report, the OIG did 
not comment on our findings, but the OIG did provide technical 
comments, which we incorporated as appropriate. 

We are sending a copy of this report to the Inspector General of HHS 
and other interested parties. In addition, the report is also available 
at no charge on GAO's Web site at http://www.gao.gov. 

If you or your staffs have questions about this report, please contact 
me at (312) 220-7600 or aronovitzl@gao.gov. Contact points for our 
Offices of Congressional Relations and Public Affairs may be found on 
the last page of this report. Susan Anthony, Assistant Director; Kevin 
Milne; Dae Park; and Sari B. Shuman made key contributions to this 
report. 

Leslie G. Aronovitz: 
Director, Health Care: 

Enclosure: 

List of Committees: 

The Honorable Arlen Specter: 
Chairman: 
The Honorable Tom Harkin: 
Ranking Minority Member: 
Subcommittee on Labor, Health and Human Services, Education, and 
Related Agencies: 
Committee on Appropriations: 
United States Senate: 

The Honorable Charles E. Grassley: 
Chairman: 
The Honorable Max Baucus: 
Ranking Minority Member: 
Committee on Finance: 
United States Senate: 

The Honorable Ralph Regula: 
Chairman: 
The Honorable David R. Obey: 
Ranking Minority Member: 
Subcommittee on Labor, Health and Human Services, Education, and 
Related Agencies: 
Committee on Appropriations: 
House of Representatives: 

The Honorable Joe Barton: 
Chairman: 
The Honorable John D. Dingell: 
Ranking Minority Member: 
Committee on Energy and Commerce: 
House of Representatives: 

Comments from the Department of Health and Human Services: 

DEPARTMENT OF HEALTH & HUMAN SERVICES: 
Office of Inspector General: 
Washington, D.C. 20201: 

MAR 3 2006: 

Ms. Leslie G. Aronovitz: 
Director, Health Care: 
U.S. Government Accountability Office: 
Washington, DC 20548: 

Dear Ms. Aronovitz: 

Enclosed are the Department's comments on the U.S. Government 
Accountability Office's (GAO) draft report entitled, "CHILDREN'S HEALTH 
INSURANCE: Recent HHS-OIG Reviews Inform the Congress on Inappropriate 
Enrollment and Reductions in Low-Income, Uninsured Children" (GAO-06- 
457R). These comments represent the tentative position of the 
Department and are subject to reevaluation when the final version of 
this report is received. 

The Department provided several technical comments directly to your 
staff. 

The Department appreciates the opportunity to comment on this draft 
report before its publication. 

Sincerely, 

Signed by: 

Daniel R. Levinson: 
Inspector General: 

Enclosure: 

The Office of Inspector General (OIG) is transmitting the Department's 
response to this draft report in our capacity as the Department's 
designated focal point and coordinator for U.S. Government 
Accountability Office reports. OIG has not conducted an independent 
assessment of these comments and therefore expresses no opinion on 
them. 

COMMENTS OF THE DEPARTMENT OF HEALTH AND HUMAN SERVICES ON THE U.S. 
GOVERNMENT ACCOUNTABILITY OFFICE'S DRAFT REPORT ENTITLED, "CHILDREN'S 
HEALTH INSURANCE: RECENT HHS-OIG REVIEWS INFORM THE CONGRESS ON 
INAPPROPRIATE ENROLLMENT AND REDUCTIONS IN LOW-INCOME, UNINSURED 
CHILDREN" (GAO-06-457RI: 

The Department of Health and Human Services (HHS) appreciates the 
opportunity to comment on the draft report. The Medicare, Medicaid, and 
SCHIP Balanced Budget Refinement Act of 1999 (BBRA) mandates that every 
3 years the Office of Inspector General (OIG) determine the number of 
separate SCHIP enrollees, if any, who are eligible for Medicaid and the 
reduction in the number of low-income, uninsured children. Your report 
carries out the additional BBRA mandate that GAO review these two OIG 
studies. Our comments follow. 

In the first paragraph on page 2, GAO indicates that Congress asked OIG 
to study two issues-inappropriate enrollment and the reduction in the 
number of low-income, uninsured children. In regard to the first issue, 
BBRA asks OIG to determine the number of children, if any, who are 
enrolled in separate SCHIP but are eligible for Medicaid (rather than 
inappropriate enrollment.) Congress's concern, as expressed through the 
mandate, is that children eligible for Medicaid would instead be 
enrolled in SCHIP, thus allowing a State to claim a higher match rate. 
This clarification should be noted throughout when it describes the 
purpose of this study. 

In the second paragraph on page 8, when discussing Medicaid expansion, 
GAO's presentation implies that OIG projected its findings to the 
universe of children enrolled in Medicaid expansion programs. OIG did 
not. We suggest deletion of the sentence that discusses OIG not 
calculating a confidence interval because a discussion of confidence 
intervals is not warranted when no projection has occurred. If GAO 
chooses not to delete this sentence, we suggest that GAO replace the 
current language, "The OIG did not calculate a confidence interval for 
the error rate estimate for the Medicaid expansion programs.." with the 
following language, "The OIG did not project to the universe for 
Medicaid expansion programs.." 

[End of section] 

(290512): 

FOOTNOTES 

[1] Medicaid is a federal-state program that provides health care 
coverage to certain categories of low-income adults and children. SCHIP 
was established as title XXI of the Social Security Act by the Balanced 
Budget Act of 1997, Pub. L. No. 105-33,  4901, 111 Stat. 251, 552, and 
is codified at 42 U.S.C.  1397aa, et seq. 

[2] The District of Columbia is included among our discussion of states 
for purposes of this report. 

[3] Federal funds are allotted to states for SCHIP programs up to a 
specified amount each year. See 42 U.S.C.  1397dd. 

[4] The SCHIP statute includes a provision requiring states, in 
establishing their programs, to specify strategic objectives and 
performance goals for providing child health assistance. See 42 U.S.C. 
 1397gg. 

[5] Pub. L. No. 106-113, App. F.,  703, 113 Stat. 1501A-321, 1501A- 
401-402. 

[6] GAO, Children's Health Insurance: Inspector General Reviews Should 
Be Expanded to Further Inform the Congress, GAO-02-512 (Washington, 
D.C.: Mar. 20, 2002). 

[7] Department of Health and Human Services Office of Inspector 
General, SCHIP: States' Progress in Reducing the Number of Uninsured 
Children (Washington, D.C.: August 2004); Determining if Children 
Enrolled in Separate SCHIPs Were Eligible for Medicaid (Washington, 
D.C.: June 2005); and Determining if Children Classified as SCHIP 
Medicaid Expansion Meet Eligibility Criteria (Washington, D.C.: October 
2005). 

[8] See GAO-02-512. In that report, we noted that the OIG's findings 
could not be generalized to all SCHIP programs because sample cases 
were limited to five states' separate SCHIP programs. Therefore, we 
recommended that the OIG (1) expand its scope when conducting 
subsequent mandated studies and (2) review enrollment practices in 
states with Medicaid expansion programs, in addition to separate SCHIP 
programs, to further inform the Congress about the appropriateness of 
enrollment. Because state evaluations of reductions in the uninsured 
had limitations, we also suggested that the OIG review other available 
literature on changes in the uninsured population for its next study. 

[9] Prior to September 30, 2002, Tennessee had a Medicaid expansion 
program under SCHIP, which covered children born before October 1, 
1983, and who were under age 19 with family incomes up to 100 percent 
of the federal poverty level. After September 2002, Tennessee 
discontinued its SCHIP program because all enrolled children had aged 
out of the program. 

[10] At the time of the OIG's review, New York had a combination SCHIP 
program. New York's program changed to a separate SCHIP program as of 
April 1, 2005, when all of the children enrolled in the state's 
Medicaid expansion aged out of the program. 

[11] For example, a state with a 50 percent Medicaid match receives a 
65 percent match under SCHIP. 

[12] The CPS is the primary source of information on the labor force 
characteristics of the U.S. population, and estimates obtained from the 
CPS include employment, unemployment, earnings, and hours of work. 

[13] Two separate SCHIP programs--Michigan and Rhode Island--were 
unable to provide necessary data to the OIG. 

[14] Michigan's Medicaid expansion program was unable to provide 
necessary data to the OIG. 

[15] The OIG did not report confidence intervals for its initial review 
of inappropriate SCHIP enrollment. 

[16] A confidence interval provides an estimated range of values, 
within which the true error rate for the population will likely fall. 
For this study, the OIG calculated that the true enrollment error rate 
could be from 0.3 to 2.6 percent, which is 70 percent below and 160 
percent above the estimated error rate. 

[17] Four of the five states excluded from the most recent OIG review-
-Connecticut, Hawaii, Minnesota, and Nevada--were excluded because they 
did not submit their SCHIP annual reports by June 1, 2003. The 
remaining state, Tennessee, was not required to submit an annual report 
because there was no one enrolled in its SCHIP program. 

[18] Of the 22 states that directly demonstrated changes in the 
uninsured population of children, 12 states used CPS data and 10 states 
used state survey data. 

[19] Although the CPS asks respondents if they had health insurance 
coverage within the past year, the question is asked at a specific 
point in time and may result in respondents answering incorrectly. For 
example, those who had health insurance at some time during the year, 
but who are uninsured at the time of the survey, may mistakenly answer 
the question with their current uninsured status, which can lead to an 
overestimate of the uninsurance rate. 

[20] When reporting uninsurance rates, the Census Bureau reports 3-year 
averages. Therefore, at least 4 years of data will need to be collected 
to measure the full impact of the expanded sample. The 4 years of data 
will allow for a comparison of the change in the rate of low-income, 
uninsured children from two consecutive 3-year averages.