Financial Literacy - Families and Finance
Keep kids covered -- with health insurance

Kids need and deserve a few essentials to make sure they get the best start possible: food, clothing, shelter and a good education, of course. But they also need dental and medical care to ensure that they grow into healthy, productive adults.

Unfortunately, millions of children have no health insurance coverage and as a result don't get the kind of health care they need.

In 2007, according to the Census Bureau, some 8.1 million children had no insurance in the United States.

Though free or low-cost health insurance is available to kids in the poorest families, it's more difficult for parents with higher earnings to get coverage for their kids.

There are insurance options for ...
  1. Low-income families.
  2. Higher earners.
  3. Newly jobless.

Low-income families

Most free or subsidized help is available to children whose parents earn slightly above the poverty level.

A program called the State Children's Health Insurance Plan was created in 1997 to offer health insurance coverage for the children of low-income families. According to the Center on Budget and Policy Priorities, SCHIP was originally created as an adjunct to Medicaid.

In February, the Children's Health Insurance Program Reauthorization Act of 2009 was signed into law. CHIPRA expanded eligibility and increased funding for the State Children's Health Insurance Plan.

According to the Department of Health and Human Services and the CHIP statistical enrollment data system, in 2008 about 7.4 million kids were enrolled, up from around 7 million the previous year.

With the signing of the reauthorization act, regulators hope to enroll another 4 million kids in the program. Most of them are already eligible for the program but just haven't signed up.

Eligibility varies from state to state but "most states cover people up to the range of 200 (percent) to 250 percent of the poverty level, which in 2009 is about $36,620 to $45,775 for a family of three," says Sarah Lueck, policy analyst with the Center on Budget and Policy Priorities.

"But some states cover kids that are at less than that and some states go beyond 250 percent of poverty level," she says.

Parents who have no health insurance for their kids should contact their state health insurance program to find out more about the eligibility requirements in their state.

Higher earners

For parents who earn too much to qualify for the free or low-cost state programs but still struggle to insure their children, finding a job with health insurance coverage is the ideal solution -- but that's not always an option. Many employers, particularly smaller ones, don't offer health benefits.

In that event, the only other option is to buy an individual or family policy, at least until Congress comes up with a universal plan.

At the very least, children should have a major medical policy so that there is coverage in the event of a major illness or injury. And that goes for parents as well, says Certified Financial Planner Tracey Baker, author of "Navigating Your Health Benefits for Dummies."


A policy that covers only major illness or injury won't cover yearly checkups, but can serve as a safety net in the face of a calamity. Because they don't cover ongoing wellness issues, these policies are generally much cheaper than full coverage, but can be a lifesaver in the event of an emergency.

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