The Impact of the Los Angeles Healthy Kids program on County Indigent Care Programs

THE IMPACT OF THE LOS ANGELES HEALTHY KIDS PROGRAM ON COUNTY INDIGENT CARE PROGRAMS Submitted to Prepared by Michael R. Cousineau Albert J. Farias 1000 South Fremont Avenue, Building A4, Room 7411 Alhambra, California 91803 November, 2008 1 As the debate for insuring the uninsured continues at the federal and state level, policy makers explore the options for dealing with the uninsured. There are two options for covering the medical services for uninsured, low income children. The first is to enroll eligible children into a comprehensive coverage insurance program, the managed care model. In Los Angeles County such programs have traditionally been limited to federal and state funded programs, chiefly Medi-Cal and Healthy Families. In 2003, the Los Angeles Healthy Kids program was launched to expand coverage for children who do not qualify for Medi-Cal or Healthy Families and whose family income is below 300% the federal poverty level (FPL). The second option for covering medical services for uninsured low income children is through indigent care services provided by safety net clinics that provide care to all people regardless of their ability to pay or through county-operated facilities. The implications for expanding coverage through comprehensive insurance programs is significant for indigent care offered by safety net providers and county facilities because funding is quite complex and vulnerable to political and economic factors. Funding for uncompensated care for the indigent uninsured is partially supported by direct institutional grants and contracts, government subsidies and philanthropic contributions. In Los Angeles, health services for uninsured adults and children are offered as part of an indigent care program and are based on the income of the uninsured. These services are provided through two related programs. The first is the indigent care program operated by the Los Angeles County Department of Health Services (DHS). DHS operates six comprehensive ambulatory care health centers, four 2 hospitals and an array of smaller clinics and health centers. Patients must meet an eligibility requirement based on income, and fees are determined using a sliding scale. In addition to the directly-operated programs, DHS also contracts with private clinics and physicians’ offices under its Public Private Partnership (PPP) program, which reimburses providers with a flat fee for services to individuals who are uninsured and indigent. Eligible providers are reimbursed at a per-visit rate which covers medical visit, lab and X-ray, pharmacy and support services. Currently, DHS has 55 contracts with clinics and health centers to provide care for qualifying PPP patients. Individuals of all ages whose self-reported net family income is at or below 133-1/3% of the Federal Poverty Level (FPL) and who do not qualify for Medi-Cal or other government or third-party assistance programs are eligible to receive primary, specialty, and dental care services. While the program is available to all eligible individuals, funds allocated to each facility are capped, limiting the number of patients they serve or the services they provide. In both the DHS and PPP programs, patients are not enrolled in a licensed health insurance program. Instead, services for eligible patients are paid using net county funds on a per visit basis for as long as funding is available. Children receiving care through the indigent care program offered by Los Angeles County tends to be more episodic in nature and care management and coordination of services is often limited. In July 2003 the Healthy Kids Program was launched in an effort to expanding comprehensive insurance to uninsured children in Los Angeles County. The local program offers health insurance coverage to uninsured children ages 0-18 living in Los Angeles County who are ineligible for Medi-Cal or Healthy Families due to immigration 3 status and are living in families with incomes at or below 300 percent of the federal poverty level (FPL). Funding for coverage of children ages 0-5 comes from First 5 LA, which also supports outreach and enrollment activities. Funding for 6-18 year old children was raised by the Children’s Health Initiative of Greater Los Angeles from a large number of private foundations and corporations. As of September of 2008, the Healthy Kids program has grown to a membership of 31,947 children (5,699 children ages 0 to 5; 26,248 children ages 6-18), making it the largest local Children’s Health Initiative program in California. Under the H