Dive Brief:

• The number and percentage of uninsured children in the U.S. increased for the first time in more than a decade in 2017, according to a new Georgetown University Health Policy Institute report.

• About 276,000 fewer children had health insurance in 2017 compared to the previous year. The percent of uninsured children increased from 4.7% to 5% over the year.

• Most of the children who lost health coverage live in states that didn't expand Medicaid, including Texas. The Lone Star State has the largest percentage of uninsured children.

Dive Insight:

Policymakers generally agree that children need health insurance. Covered children have better access to care, including preventive services and wellness checkups. Having insurance can lead to better health status and outcomes and lower overall health costs. 

A decade ago, 7.6 million American children were uninsured. Since then, the number has dropped, thanks in large part to the Affordable Care Act. The ACA allowed states to expand Medicaid, disallowed payers from using someone's preexisting conditions to deny coverage or jack up rates, implemented an individual mandate and created exchanges that made it easier for people to find individual and nongroup plans.

All of those actions helped improve the number of insured. Medicaid expansion was the major driver. More than 15 million additional Americans are covered through expansion.

However, Georgetown University Health Policy Institute found that in 2017 the number of uninsured children increased to 3.9 million from 3.6 million in 2016. Nine states saw "significant" increases in the rate of uninsured children (South Dakota, Utah, Texas, Georgia, South Carolina, Florida, Ohio, Tennessee and Massachusetts).

South Dakota had the biggest jump from 4.7% to 6.2%. Massachusetts, which is a Medicaid expansion state, saw its rate increase from 1% to 1.5%. Expansion state uninsured rates increased from 3.5% to 3.7% between 2016 and 2017. Non-expansion states had a bigger increase (6.4% to 7%).

Uninsured children issues are worse in particular states, especially Texas, Florida, California and Georgia. Those four states make up more than two-fifths of uninsured children in the U.S. Texas tops the list with 10.7 million children without health insurance.

Rosie Valadez McStay, assistant vice president of government relations and community benefits at Texas Children's Hospital in Houston, told Healthcare Dive on Thursday that the hospital has experienced a drop in the number of children covered by Medicaid. She said the state has "stringent Medicaid qualifying requirements," including a low poverty level line to qualify. Overall, the hospital has seen a slight decrease in the number of children covered by a health plan. 

Valadez McStay said fewer covered children means costs are shifted or absorbed by other payers, including commercial insurers and local taxpayers.

"Commercial rates help offset some of the costs of an uninsured patient we treat; local taxpayers are assessed a fee to cover indigent care. In the case of local taxpayers, this means property owners pay the assessed tax to the tune of $2 billion a year," she said. "The more uninsured children treated, the more costs are shifted to these resources rather than to the programs created to cover and pay for health services. It should be pointed out the majority of children are healthy, so to cover them is very inexpensive and cost-effective.”

In its report, Georgetown University Health Policy Institute warned the uninsured increase could be the start of a trend unless states take action. Two possible solutions are the 14 non-expansion states expanding the program and states improving health insurance enrollment and retention efforts.

The report found that 56.8% of uninsured children are actually eligible for Medicaid or a Children's Health Insurance Program (CHIP) plan. Valadez McStay suggested more Medicaid and CHIP advertising could make more families aware of the options. Plus, she suggested re-enrollment via mobile phone apps and the web could help retain Medicaid members.

"Too many families only seek to get on Medicaid when their child is sick, and then when the coverage expires, they wait to reapply until they need it again. While the state did get rid of the asset test for those eligible for a regular Medicaid program, there is still room to improve on this front," she said.

Despite the higher uninsured numbers, there is a reason for optimism. Voters in three states (Utah, Nebraska and Idaho) recently approved Medicaid expansion. Virginia plans to expand its program in 2019. Maine will also likely expand Medicaid next year once Gov. Paul LePage, a Republican, leaves office. LePage has been delaying implementation since voters backed the measure in 2016.

Those five new Medicaid expansion states should help lower the percentage of uninsured Americans in 2019.