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California could keep about $350 million in federal funds to subsidize low-cost health insurance for children, under a bill approved by Congress. 

The Child Health Insurance Program, known as the Healthy Families program in California, is a joint federal-state insurance program for the children of low-income families.  

States that hadn’t spent their full federal share will be able to keep about 60 percent of their 1998 funds, and can use it to provide low-cost health insurance for families that make too much to qualify for Medicaid, but not enough to pay for traditional health insurance. 

“This is an embarrassment of riches. It is imperative that we do a better job of signing up children and that we take advantage of all these dollars to cover the whole family,” said Anne Marie Flores of the Pacific Institute for Community Organization, an advocacy group for the uninsured. 

Healthy Families was created to provide medical care to children in families where the annual income is less than 2 1/2 times the federal poverty level. 

That means a family of three with an annual income of less than $35,000 a year would qualify. Families pay premiums of $4 to $27, depending on how many children are enrolled. 

The state is still waiting to hear if they can expand the program to cover the parents of those children. 

U.S. Sen. Dianne Feinstein, D-Calif., called the bill “an important first step” in addressing the problem of the uninsured. 

State and private experts believe there are about seven million Californians — including two million children — currently without health coverage. 

Allowing states to expand coverage to parents would help lower California’s rate of uninsured by about 600,000, Flores said. 

The state will have to come up with $128 million in matching funds if the program can be expanded to adults, she said. 

“This issue of having 7 million uninsured in California is horrible,” said Assembly Speaker Robert Hertzberg, D-Van Nuys. “If the money had gone back to Washington, it would have been nothing short of criminal.” 

Legislators will be watching efforts to streamline the application process over the next year, Hertzberg said. 

“We want to do everything we can do to simplify the process and make sure everyone is treated fairly,” he said. 

The bill allowing states to keep some of the federal money was approved by Congress Friday as part of a larger spending bill. 

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On The Net: 

http://www.healthyfamilies.ca.gov