Jewish Museum/Prague

Many poor children receive medical care because of the Medicaid program, created in 1965 as part of President Lyndon Johnson's Great Society.

On paper, Medicaid looks like a dream program. Services eligible for coverage are extensive: well child care, immunizations, and all medically necessary treatment. In Illinois most doctors and medical institutions have registered with the program. Finally, far in advance of most other health care plans, Medicaid applicants and recipients have the right to appeal, receive hearings, and sue to challenge both the denial of coverage and the denial of services and care.

Detractors observe that what's on paper does not provide an accurate description of how the program operates on the ground. Many eligible children are denied coverage because of the program's bureaucracy, and many others cannot find doctors to treat them.

While Medicaid has been criticized as too extensive and too expensive by some, the fact is that it is the only program that pays for basic health care for poor children. In Illinois, over 700,000 children are enrolled in Medicaid and depend on it for access to health care. In Cook County, over 70% of the families with incomes below 133% of the federal poverty level have at least one family member enrolled.

Medicaid is a joint federal-state program. In return for federal financing—50 cents out of each dollar spent—Illinois agrees to operate the state program under broad federal parameters. However, states are given great latitude.

Most parents in Illinois who seek Medicaid coverage for their children apply by going to the local Illinois Department of Human Services office. If the Department's case workers find that the children are eligible for coverage, the parents receive a medical card. Presented at the doctor's office, clinic, or hospital when medical treatment is sought, the card serves as a payment voucher. Although the program is required to reimburse providers for all necessary medical services needed by children, the irony is that many doctors will not accept children as patients who are on Medicaid. Medicaid reimbursement rates lag far behind what is paid for children's services by private insurers. And, when Illinois tax collections lagged in the past, doctors often waited months to be paid.

The children's Medicaid program rests on three legs: eligibility for services, services covered, and available providers. Each is crucial in the delivery of health care services to children.

Children qualify for Medicaid in two different ways. Some are in families receiving cash benefits from Illinois under the Temporary Assistance for Needy Families (TANF) program. Children in families with incomes up to 185% of the federal poverty level also qualify. In 2000 an Illinois family of four can qualify for Medicaid coverage for their children if family income is less than $2629 a month.

However, in assessing family income, no consideration is given to health care expenses. A family of four with monthly income of $2600 will qualify for coverage for their two children, while a family of four with monthly income of $2700 will not. A child with a chronic health condition that requires frequent medical care generally will not qualify for Medicaid—regardless of the total cost of medical expenses—if family income is too high. As a result, many families in Illinois who do not have access to health insurance through other avenues, such as employment, must limit family monthly income to ensure that their children can continue to qualify for Medicaid coverage.

Some children do not receive benefits as a result of problems within the bureaucracy. For example, welfare computers automatically terminated Medicaid for children in families ending TANF even though they continued to be eligible. Other families were improperly denied coverage.

In other areas, however, Illinois acted wisely. Despite federal cutbacks for immigrants, Illinois agreed to provide Medicaid to many immigrant children who would otherwise be ineligible. And Illinois has moved forcefully in the past few months to identify and enroll children in families whose incomes make them eligible. Other agencies, including the Chicago Board of Education help to identify children who may be eligible for coverage. The goal is to locate and enroll all children who are eligible, ensuring that no child goes without health care because of a family's inability to pay.

Medicaid is unique in that it is required, in the words of the Illinois authorizing statute, to cover all medically necessary care and treatment for children.

Federal Medicaid rules have long required states to reimburse medical providers for preventive care and immunizations. Under the Early and Periodic Screening, Diagnosis, and Treatment program, Illinois is responsible for providing medical check-ups, vision, hearing, and dental services as well as necessary diagnostic and treatment services to all Medicaid-eligible children from birth through age twenty.

But the data shows that Illinois, like most states, has not done well in ensuring that children enrolled in Medicaid receive preventive health care. State Medicaid data, provided in pending litigation, suggests that less than half the eligible children from birth to two years of age received the screening examinations found essential by the American Academy of Pediatrics. Data for immunizations likewise shows that many children do not receive necessary immunizations until they enter school at age five.

The great unknown in the Medicaid program is whether there is a sufficient number of providers to meet the health care needs of children in Illinois. Health care providers who treat these children are varied, from doctors in their own offices to hospitals and neighborhood health clinics. For the most part these medical providers may choose whether or not to serve a child on Medicaid. While most pediatricians and family practitioners in Illinois treat some children enrolled in Medicaid, the majority of these patients of are treated by a relatively small number of doctors.

While doctors are not required to accept patients enrolled in the program , Illinois is required to ensure that children on Medicaid have adequate access to health care. The federal statute provides that states must reimburse at rates sufficient to ensure that the number of health care providers available to children on Medicaid is the same as available to the population in general. There is no reliable data that tracks whether this requirement is being met, but Medicaid reimbursement rates are much lower than those paid by private insurers.

At present, Medicaid is the only viable system in place to provide health care financing for low-income children in Illinois. However, much remains to be done to ensure that these children receive adequate preventive care and treatment.

The state must work to ensure that children whose families lose cash assistance under TANF continue to receive Medicaid. And it must investigate imaginative ways to provide Medicaid services to families who have medical costs that drive their income below 185% of the federal poverty level.

Illinois also faces great challenges in ensuring that children enrolled in Medicaid receive the preventive services and immunizations they need—and in a timely fashion. Finally, Illinois must address the issue of medical provider access squarely. Recent expansions in eligibility will be of little consequence if these children, once enrolled, cannot find doctors to treat them.

Thomas Yates is an attorney at the SSI Coalition for a Responsible Safety Net, a nonprofit agency that works to protect and improve programs that assist low-income elderly and persons with disabilities.