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Millions in child health funds go unspent


WASHINGTON - Forty states will soon lose hundreds of millions of dollars of federal money that was supposed to provide health insurance to children in low-income families, federal and state officials say.

The money - 45 percent of the $4.2 billion provided by Congress - remains unspent by the states after three years. It will be given to the 10 states that used their full allotments of federal money under the Children's Health Insurance Program, which was created by Congress, with much enthusiasm and fanfare, in 1997.

"We would like to be able to keep that money and use it to provide health care to children," said Helene Robinson, director of the state program in Louisiana, which expects to lose $63.7 million, or 63 percent of its federal allotment of $101.7 million.

California and Texas account for more than half of the unspent money - $590 million and $446.3 million, respectively. Together they have 29 percent of the nation's 11 million uninsured children.

Health care for children has become a major issue in the presidential campaign. Vice President Al Gore, the Democratic nominee, says Gov. George W. Bush, the Republican candidate, has a dismal record of providing health insurance to children in Texas.

Bush rejects the criticism. Texas officials say 100,000 children have enrolled in the new program since the state began taking applications in April.

Dan Bartlett, a spokesman for the Bush campaign, said Gore "should address the problems on his own watch." Bartlett said that the number of uninsured children nationwide had increased since the Clinton administration took office, and Census Bureau reports show that the 11 million figure is up from 9.6 million in 1993.

States have until Sept. 30 to spend the money they were allotted. In interviews with the New York Times, officials in 20 states gave these reasons for failing to use their full allotments:

Some states took a year or more to start enrolling children.

Some were reluctant to put up the state money they had to spend to obtain the full amount of federal money available.

Some states said they could not find enough eligible uninsured children to use all their federal money.

Some states inadvertently deterred enrollment by using complex application forms and procedures.

Some states complained that the federal government had administered the program in a rigid, inflexible way that prevented them from spending the money for children who might have benefited.

The states that have used all of their 1998 allotments are Alaska, Indiana, Kentucky, Maine, Massachusetts, Missouri, New York, North Carolina, Pennsylvania and South Carolina. Those states will have one year to spend the extra money, which reverts to the Treasury after Sept. 30, 2001.

The Children's Defense Fund, an advocacy group, celebrated creation of the program as a landmark in social policy. But Gregg Haifley, deputy director of the fund's health division, said the group was now telling states: "Get off the dime. Spend this money on what it's intended for. Don't let it just pile up or trickle through your hands."

The Children's Health Insurance Program is meant to help children in families with too much income to qualify for Medicaid and too little to afford private insurance. State officials said the program had done immense good, by providing care to over 2 million children while also stimulating improvements in Medicaid.

But spending has trailed expectations. Donna Shalala, the secretary of health and human services, said, "A significant portion of the allotments will be unspent."

Congress provided a total of $40 billion over 10 years. States had three years - from Oct. 1, 1997, to Sept. 30, 2000 - to use the first year's installment of $4.2 billion. State and federal officials said that $1.9 billion of that amount would be unspent at the end of this month.

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