1. Presentation to the House Appropriations Subcommittee on Health & Human Services Medicaid and CHIP Caseloads April 17, 2006

2. Page 2 Medicaid Caseload  Historical caseload from September 1977 to present  Caseload history by risk group and fiscal year  Recent caseload by risk group Children’s Health Insurance Program Caseload  Historical caseload from September 2003 Medicaid and CHIP Caseloads

3. Page 3 Medicaid Acute Care Historical Caseload: September 1977 – March 2006

4. Page 4 Medicaid Historical Caseload Medicaid caseloads have grown historically as a result of the expansion of eligibility groups, most notably Children’s groups Historical declines were seen in the Medicaid caseload overall after sustained growth from 1977 forward, beginning fiscal year 1997, following federal welfare reform  By the end of fiscal year 2000, caseloads had stabilized and were beginning to increase  Currently, caseloads have declined since November 2005, however not all risk groups are declining

5. Page 5 Medicaid Historical Caseload

6. Page 6 Medicaid Historical Caseload Total Medicaid caseload grew 54 percent from fiscal year 2000 to 2005, by close to 1 million clients In that same time, the non-disabled Children served by Medicaid grew by 80 percent, from slightly over 1 million Children to slightly less than 2 million.  Non-disabled Children currently comprise 70 percent of the Medicaid caseload  Adding CHIP Children to that picture brings the growth since fiscal year 2000 to 105 percent, with over 1.1 additional Children served by Medicaid or CHIP from 2000 to 2005.

7. Page 7 Medicaid Historical Caseload

8. Page 8 Medicaid Acute Care Caseload Medicaid caseload trends, which averaged approximately 8 percent in fiscal year 2004 after double-digit growth in both fiscal years 2002 and 2003, began to stabilize at approximately 4 percent overall beginning December 2004.  At that time, trends for the two largest Children’s Medicaid groups (non-TANF, non-disabled ages 1 to 18) dropped below 10 percent for the first time in many years.  From March 2005 through October 2005, the growth trend for this group of Children stabilized at 6 percent.  For comparison, from March 2004 through October 2004, the growth trend for this group of Children averaged 15 percent. The slowed growth beginning December 2004 may be a result of changes in the economy and outside forces impacting client behavior. However, the more recent declines may be driven by a number of interacting factors in the short-term.

9. Page 9 Medicaid Acute Care Caseload Medicaid caseload (overall) continued to increase until November 2005, at which point began the first sustained caseload decline since FY1999. Caseload growth or decline differs by risk group  Newborns and Disabled and Blind are increasing steadily  Aged and Medicare related are increasing at a rate of 1.5% (slightly lower than population)  Pregnant Women remain mostly stable, with some very recent growth  All other groups are declining

10. Page 10 Medicaid Caseload: October 2005 & March 2006

11. Page 11 CHIP Caseload 9,107 78.9%81.7%6.8% Mar-05 328,350 19,163 33,223 6,982 21,206 8,230 80.1%83.0%6.5% Apr-05 326,836 20,379 37,171 8,031 21,875 8,398 81.6%84.3%6.7% May-05 326,809 21,278 39,088 7,248 21,288 8,087 82.9%85.1%6.5% Jun-05 326,473 19,623 37,899 6,156 19,955 8,062 82.5%84.5%6.1% Jul-05 327,267 20,404 35,735 6,625 19,609 7,517 82.6%84.9%6.0% Aug-05 326,770 18,998 35,195 6,029 19,493 7,142 83.1%85.2%6.0% Sep-05 326,557 18,624 34,128 5,693 18,832 6,892 83.2%85.2%5.8% Oct-05 323,343 17,176 37,059 7,070 20,360 7,914 82.4%84.8%6.3% Nov-05 321,562 19,129 39,485 6,527 20,902 8,024 83.1%85.2%6.5% Dec-05 322,898 20,385 37,964 6,297 19,048 7,428 83.6%85.6%5.9% Jan-06 317,408 11,591 18,460 1,227 20,303 17,290 51.6%53.2%6.4% Feb-06 310,981 23,937 25,285 4,387 26,553 20,097 55.7%59.6%8.5% Mar-06 302,020 23,728 19,482 10,370 31,220 19,298 50.2%60.7%10.3% Apr-06 294,189 29,479 19,081 10,065 37,167 19,740 49.2%59.6%12.7%

12. Page 12 CHIP Caseload Total CHIP caseload began declining in October 2003 as a result of policy changes, after having stabilized for most of fiscal year 2003 at approximately 507,000. CHIP caseload stabilized to approximately 326,500 from April – September 2005 (within 500 of the average each month), with a decline of 3,000 holding steady through December 2005  Beginning January 2006, CHIP caseload declined by almost 6,000 to 317,408, with similar declines in the following months.  Currently, CHIP caseload is 294,189 for April 2006.

13. Page 13 CHIP Caseload Beginning November 28, 2005, the eligibility for the CHIP program changed from Affiliated Computer Services (ACS) to Texas Access Alliance (TAA). The first clients processed by TAA were seen in the January 2006 caseload.  March 2006 is the first month that new enrollment fees were to be paid by clients.  In addition to changing vendors, new business rules were implemented, including requiring verification of income status upon renewal for CHIP, rather than only a statement that income had not changed. The decline in the CHIP caseload, like the decline in the Medicaid caseload, may be driven by a number of factors.