Affordable Care Act Foster Care Regulation a Win for Kids, Concerns With Rule’s Scope Could Limit Health Gains for Youth

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Ed Walz
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Washington — The bipartisan children’s advocacy organization First Focus reacted today to the foster care provisions of draft regulations released Monday by the federal Centers for Medicare and Medicaid Services (CMS) implementing the Affordable Care Act (ACA). If concerns about the rule’s scope are addressed, the final rule has the potential to cover nearly 200,000 uninsured young adults formerly in foster care, providing true parity for former foster children with children raised by their own parents.

“One of the most popular parts of health reform is coverage for kids up to age 26 on their parents’ insurance. This rule has the potential to provide equal treatment in cases where the state steps in to care for kids removed from home as a result of abuse or neglect,” said First Focus president Bruce Lesley.

The regulation’s most significant provision for foster children requires states to provide Medicaid coverage for young adults under age 26 who aged out of foster care and were covered by Medicaid while in foster care.

Children in foster care are automatically eligible for Medicaid. More than 20,000 American children “age out” of foster care every year. While federal law allows states to extend Medicaid coverage to former foster children ages 18 to 21, few states did so. Most states discontinued Medicaid coverage at age 18, subjecting young adults leaving foster care to increased health and financial risks. The ACA requirement was intended to create parity for children leaving foster care with children leaving their parents’ homes to begin adult lives.

The First Focus analysis includes one significant potential problem concerning the regulation’s foster care provision. It could be read to make Medicaid coverage up to age 26 optional in states where a child was in foster care in a state different from the state in which he or she applied for Medicaid coverage as a young adult. First Focus is submitting comments to CMS urging that the final regulation align with Congress’ intent in creating this provision of the ACA to provide health care parity for foster children with kids leaving family homes.

“That just doesn’t make sense,” said Lesley. “Consider the DC metro area – a kid leaves foster care in Maryland and moves across the river into Virginia a month after his 18th birthday – that shouldn’t make him uninsured.”