serving uninsured and low-income Americans, but this is a period of major transition (Baxter and Mechanic, 1997; Fishman and Bentley, 1997; Lipson and Naierman, 1996).

About a year ago we made a decision to close down five church-based immunization clinics because of funding cuts. Consequently, we had people come to the health department for immunizations for their children. We have subsequently seen a sharp decline in the immunization rates because transportation is a major problem, and we are unable to provide that service at this point in time.

Ross Marine

Jackson County Health Department, Kansas City, MO

Public Workshop, June 2, 1997

In addition to market forces, recent national legislation also can be expected to have a significant impact on the delivery and financing of health care for low-income Americans, and children may be particularly affected. The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 ("welfare reform"), which was required to be in effect in all states by July 1, 1998, eliminates the automatic connection between welfare and Medicaid eligibility. In combination with other changes in Medicaid, this could dramatically change the flow of funding for safety net providers over the coming years.

In August of 1997, the Balanced Budget Act of 1997 (BBA) authorized $20.3 billion for a new State Children's Health Insurance Program (SCHIP) and $3.6 billion for Medicaid improvements (see Box 1. 1). The SCHIP program was designed to help states cover uninsured children with family incomes that are too high for Medicaid but too low to afford private coverage. As of October 1, 1997, the SCHIP program will provide federal matching funds to states for new children's health care initiatives based on private insurance coverage, Medicaid expansions, and combinations of approaches.

In New York, we have had a long process of moving an entire AFDC [Aid to Families with Dependent Children] population into managed care programs. We are already experiencing a great deal of anxiety at the community level as the community health centers and a number of the essential community providers see themselves getting caught in a squeeze in terms of dollars. They are looking at their survivability, and unfortunately, if these folks can't be viable in the new health care landscape, then we're going to see a deficit of providers in poor communities. We are going to see a real loss for the residents of those communities as there will be no one rushing in to fill the vacuum. We have to be careful that in a rush to allow the market to work its magic, that as a by-product we don't end up losing some of the best providers we have for medically needy populations.

Dennis Johnson

Children's Health Fund, New York City

Public Workshop, June 2, 1997

Medicaid managed care in combination with new SCHIP programs could help to bolster the safety net, or could begin to replace it. Unless states specifically require safety net providers to be included in



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