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Letter to the Honorable Max Baucus 1 (July 2007)

handle is hein.congrec/cbo9304 and id is 1 raw text is: CONGRESSIONAL BUDGET OFFICE Peter R. Orszag, Director U.S. Congress Washington, DC 20515 July 24, 2007 The Honorable Max Baucus Chairman Committee on Finance United States Senate Washington, DC 20510 Dear Mr. Chairman: In response to your letter of July 10, the Congressional Budget Office (CBO) has examined available estimates of the number of children who lack health insurance but are eligible for Medicaid or the State Children's Health Insurance program (SCHIP). Some empirical studies have found that there are between 5 million and 6 million such children. In contrast to those studies, the Administration recently estimated that a much smaller number, 1.1 million children, lack health insurance but are eligible for Medicaid or SCHIP. A major reason that the Administration's figure is much lower than other estimates is that they address different questions. In particular, the Administration's estimate addresses how many children are uninsured for an entire year and are eligible for Medicaid or SCHIP. That estimate does not include all uninsured children who are eligible for the programs, however, because substantial numbers of children are uninsured for part of the year and are eligible for public coverage during that period. Consequently, the Administration's estimate understates the number of uninsured children who might participate in Medicaid or SCHIP under policies aimed at expanding enrollment. The other estimates from the research literature are instead based on the number of children who are uninsured and eligible for Medicaid or SCHIP at a particular point in time. That concept provides a more appropriate measure of the number of children who are uninsured and eligible for public coverage on average over the course of the year, which is the more relevant concept for both policy judgments and budget scoring. (For example, consider two children, one of whom is uninsured for the first six months of the year and the second of whom is uninsured for the second six months of the year. The Administration's estimates would not count either child as uninsured, because neither was uninsured for the entire year. In any month, however, one of them would be uninsured and potentially eligible for coverage under a public program.) www.cbo.gov

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