Adequacy of Health Insurance

While most children had health insurance coverage at the time of the survey, insurance coverage may not always be adequate to meet their needs. Parents whose children were currently insured were asked three questions regarding the services and costs associated with their child’s health insurance: whether the out-of-pocket costs were reasonable, whether the plan offered benefits or covered services that meet their child’s needs, and whether the plan allowed them to see the health care providers they needed. Children were considered to have inadequate health insurance coverage if their parents did not answer “usually” or “always” to all three questions. Overall, 23.5 percent of children who were currently insured had inadequate insurance; this percentage varied slightly by location with children in small rural areas less likely to have inadequate insurance compared to their urban peers (21.9 versus 23.7 percent, respectively).

The percentage of children whose insurance was inadequate was highest among children with household incomes above 100 percent of the Federal Poverty Level (FPL). Approximately one-quarter of insured children in households with incomes of 100–399 percent of the FPL in urban and large rural areas had inadequate insurance, compared to one-fifth or fewer children with household incomes below 100 percent of poverty. With regard to location, rates of inadequate insurance did not differ significantly for children in each income category.

With regard to the three specific criteria for insurance adequacy, parents most often reported that out-of-pocket costs were never or sometimes reasonable (18.0 percent; data not shown). This percentage was slightly higher in urban areas (18.3 percent) than small rural areas (16.4 percent). The parents of a smaller percentage of children reported that their child’s insurance never or sometimes covered the services their child needed (7.5 percent) or allowed their child to see the providers they needed (5.1 percent; data not shown). These rates did not vary by location.

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